Thursday, March 13, 2008

Lies, Damn Lies...

Retail sales plunged .6% say the headlines today. Sales plunged. They nose dived, they toppled, they tumbled. That sounds horrible! How can retailers survive? The big question is what number are retail sales plunging from? These guys are using the wrong numbers. The press is comparing month to month numbers. Retail sales plunged .6% from January. Never mind that this is mostly about cars and restaurants, the big problem is you don't compare month to month.

January tanked compared to December, because of Christmas. You would look like a fool if you made that comparison, but there are hundreds of articles that do this for February compared to January. Everyone in retail knows you compare numbers from the same period a year before, adjusted for holidays that fall on variable days. Even then, if February 2007 had record sales, and February 2008 dropped by .6%, then you're still doing pretty darn good. If you 're an "A" student and you bring home an A-minus, you're still getting supper.

Retail sales for February 2008 compared to February 2007 were up 2.4%. That's really good! Black Diamond Games sales were up 74%, but I've stopped comparing due to the differences between the two store; still, it's fun to say it! The only place I could find that explain these statistics is the census bureau website. These guys appreciate numbers and their meaning. Also not mentioned by the press, that .6% number has a margin of error of plus or minus .7%. So they got nothin'. Here's a good summary from the census bureau folks:

Retail trade sales were down 0.6 percent (±0.7%)* from January 2008, but were 2.4 percent (±0.8%) above last year. Gasoline station sales were up 20.2 percent (±1.0%) from February 2007 and sales of sporting goods, hobby, book, and music stores were up 6.3 percent (±2.8%) from last year.

1 comment:

  1. The mainstream press sucks. I decided not to go into journalism because I realized that the effort/reward ratio wasn't favorable enough. In other words, it was too much work for too little pay. The older I get the more I realize that just about everyone else in journalism made the same decision, only instead of switching careers they just decided not to put in the effort.