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Retailers expect upturn despite sluggish sales Michigan retailers’ short-term sales
forecasts are picking up, although actual sales remain sluggish, according
to the monthly Michigan Retail Index, a joint project of the Michigan
Retailers Association (MRA) and Federal Reserve Bank of Chicago. The January Index found that 60 percent of
retailers believe their sales will increase for February–April over
the same period last year, while 27 percent project as-good sales and
13 percent predict sales will decline. The results create a seasonally
adjusted outlook index of 69.1, up from 62.0 in December. At the same time, only 34 percent of retailers
increased sales over January ’04, while 15 percent reported as-good
sales and 51 percent recorded declines. The results create a seasonally
adjusted performance index of 44.4, down from 48.3 in December and far
short of the 50 level that would indicate an increase in positive activity
for the industry. “Even the so-called ‘January effect,’
in which the month’s sales are boosted by redemptions of holiday
gift cards sold in November and December, couldn’t get the Index
above the 50 mark,” said Larry Meyer, MRA chairman and CEO. “However,
more retailers are looking for sales to pick up in late winter and early
spring—which is a hopeful sign.” January’s lackluster numbers follow
a slower-than-anticipated holiday shopping season. They also strongly
suggest that retail sales in Michigan trailed those across the nation. Nationally, both the International Council
of Shopping Centers and the National Retail Federation said gift cards,
clearance sales and fresh spring merchandise helped many retailers ring
up “solid” sales during January. Sales tax collections totaled $558 million
in January, up 13.5 percent from last year; using a three-month smoothing
average to account for monthly volatility, collections were still up a
strong 8.0 percent. Motor vehicle sales, which continue to decline,
depressed this figure; sales tax receipts from all other retail sales
increased by a strong 18 percent. Complete results of this month’s Michigan Retail Index—including data on sales, inventory, prices, promotions and hiring—are available at www.retailers.com/news/retailindex.html. The website includes figures dating back to July 1994
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