January 23, 2002

Michigan Retailers eye chilly 1st Quarter Sales

LANSING - Most Michigan retailers are projecting slow sales for the first three months of the year, following a holiday season that registered mixed results.

Only 37 percent expect sales to increase over last year’s 1st Quarter, while 29 percent project sales will decline and 34 percent anticipate no change, according to the Michigan Retail Index.

The Index is a joint project of the Michigan Retailers Association (MRA) and the Federal Reserve Bank of Chicago and is based on a monthly survey of MRA members.

The 1st Quarter projections follow a holiday season in which Michigan retailers’ sales climbed an average 3.3 percent, with 45 percent of stores posting increases, according to the Index. Although that was less than the 6-percent rise they had projected, and the 49 percent who expected sales growth, it was better than many economists were predicting.

"In Christmas 2000, many retailers were caught by surprise when the robust sales of the previous few years didn’t materialize. This year, their expectations were lower and many of them feel good about a small increase over the previous year," said Larry Meyer, MRA chairman and CEO.

"And even though some stores rang up respectable growth during the holidays, most remain cautious about the start of 2002."

The Index found that gift stores and furniture and appliance retailers posted the best holidays sales; apparel retailers fared the worst.

The Michigan Retailers Association is the unified voice of retailing in Michigan and the nation’s largest state trade association of general merchandise retailers. MRA’s more than 5,500 retail business members operate more than 12,000 stores across the state.

Note: William Strauss, Senior Economist and Economic Advisor with the Federal Reserve Bank of Chicago, can be reached at 312.322.8151.

Michigan Retail Index
December 2001 results

December Activity
(numbers in parentheses indicate November results)

Expectations for Next 3 Months
(numbers in parentheses indicate November results)

December Sales Activity & Expectations for Next Three Months, by Region
(numbers in parentheses indicate expectations for next three months)