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Retailers approach holiday season cautiouslyAlthough most Michigan retailers are ordering the same amount of holiday merchandise as last year, nearly a third are cutting back in anticipation of a slower season. The monthly Michigan Retail Index survey by the Michigan Retailers Association (MRA) and Federal Reserve Bank of Chicago shows that 54.7 percent of retailers are not changing their ordering plans from last year, while 29.5 percent are reducing orders and 15.8 percent are increasing them. “The data suggest that the overwhelming majority of retailers are being cautious about the upcoming holiday season,” said MRA Chairman and CEO Larry Meyer. “Next month’s survey will ask retailers for their specific holiday sales projections, but the indication from their ordering plans is that most are preparing for only small gains.” The August survey found that more retailers improved sales from a year ago, but the industry continued to struggle and the short-term outlook slipped. The Index found that 38 percent of retailers increased sales in August over the same month last year while 48 percent recorded declines and 14 percent saw no change. The results create a seasonally adjusted performance index of 46.6, up from 43.1 in July. However, it was the 10th consecutive month the Index was below 50, indicating that most of the state’s retailers posted lower year-to-year sales. In addition, 56 percent believe their sales will increase for September–November, while 23 percent forecast declines and 21 percent project no change. The results create a seasonally adjusted outlook index of 64.8, down from 66.0 in July and 67.7 in June. No region of the state was immune. Sales tax collections totaled $623.2 million in August, up 2.6 percent from the year-ago level. Sales tax collections from motor vehicle transactions were up 1.1 percent. Sales tax collections from all other taxable retail transactions were up 2.9 percent to $537.4 million, which was due in part to the run-up in gasoline prices. On a fiscal year-to-date basis, sales tax collections are up 3.4 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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