State's retailers project modest holiday gains

Michigan retailers are projecting holiday sales gains averaging 5 percent, in line with national forecasts for the overall rise in spending during the season.

The monthly Michigan Retail Index survey by the Michigan Retailers Association (MRA) and Federal Reserve Bank of Chicago shows that 74 percent are predicting holiday sales that are as good or better than last year. The average projected sales change among all retailers is +5.0 percent.

“Given the sluggishness of Mich-igan’s economy and recent lackluster holiday seasons, a 5-percent gain for the holidays would be welcomed by most retailers,” said MRA Chairman and CEO Larry Meyer.

The National Retail Federation projects total holiday retail sales will climb a “moderate” 5 percent this year across the U.S. The International Council of Shopping Centers predicts same-store sales gains of up to 3.5 percent.

The Michigan Retail Index survey also found that 32 percent of retailers increased sales in September over the same month last year while 56 percent recorded declines and 12 percent saw no change. The results create a seasonally adjusted performance index of 39.6, down from 46.6 in August. It was the 11th consecutive month the Index was below 50, indicating that most of the state’s retailers posted lower year-to-year sales.

In addition, 51 percent believe their sales will increase for October-December, while 26 percent forecast declines and 23 percent project no change. The results create a seasonally adjusted outlook index of 64.5, down only slightly from 64.8 in August.

Sales tax collections totaled $571 million in September, which was up 3.2 percent from the year-ago level. Sales tax collections from motor vehicle transactions fell 23.9 percent from a year ago, due mostly to the ending of special sales incentives and a lean supply of vehicles.

Sales tax collections from all other taxable retail sales were up a strong 7.9 percent in September, due in part to high gasoline prices, which were up almost one dollar per gallon, or 50 percent, from the year-ago level.

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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