Slightly more Michigan retailers expect improved 3rd Quarter sales, following a small slip in sales during June. Page 3
Protect Data Like Cash
You should protect access to credit card data as carefully as you control access to cash in your business. Page 5
Key to Success
Smart retailers understand that customers and staff are the most important groups of people who affect success. Page 7
® August 2011 Vol. 36 No. 4
Annual meetings to elect directors, focus on tourism
Main St. Fairness support growing Dan Marshall voices a complaint common among Michigan’s “Main Street” retailers. “We’ve become a showroom for Internet retailers,” said Marshall, an
MRA board member and president and CEO of family-owned Marshall Music, which operates seven stores throughout Michigan. Marshall says shoppers browse his
34 more students earn scholarships from MRA 2011
Annual meetings for Michigan Retailers Association and Retailers Mutual Insurance Company will be held on Tuesday, August 23, at the Lexington Hotel in Lansing. The short business meetings of the MRA membership and RMIC policyholders will follow a noon luncheon that includes a presentation by George Zimmermann, vice president of Travel Michigan, on the importance of tourism to retail and the state’s economy, as well as the effectiveness of the “Pure Michigan” advertising campaign. In addition, new Michigan Centennial Retailers and MRA scholarship recipients will be recognized at the luncheon. The chief item on each meeting agenda is the election of nominees to the board of directors. The meetings are expected to start at 1:30 p.m. Seeking re-election to three-year terms on the MRA board are James Walsh, retired CFO of Meijer and an adjunct professor of finance at Grand Valley State University, and Dan Marshall, president of Marshall Music in Lansing. In addition, Becky Beauchine, owner of Becky Beauchine Kulka Diamonds and Fine Jewelry in Okemos and a member of the Michigan Retailers Services, Inc., board, is seeking a three-year term on the MRA board. Seeking re-election to three-year terms on the Retailers Mutual board are Thomas Ungrodt, president and CEO of Ideation in Ann Arbor; Peter Sobelton, owner and partner in several downtown Birmingham retail property companies; and Rod Phillips, owner of Country Casuals, Petoskey. Notices of the meetings and proxy ballots were mailed to members and policyholders in late July.
The official publication of the Michigan Retailers Association
Thirty-four students will head to college this fall with a total of $34,000 in financial assistance from the Michigan Retailers Association. Each scholarship is funded by the Michigan Retailers Foundation, a nonprofit educational organization established by MRA to benefit MRA members and their employees and families. All 34 students will receive $1,000 for one year at a public or private college or university. In the scholarship program’s 13year history, $298,000 has been awarded in 320 scholarships to students who are employees or the
children of owners or employees of MRA-member businesses. “The success of our scholarship program is a direct result of our board of directors’ strong commitment to the scholarship program,” said MRA President and CEO James P. Hallan. “The scholarships help dozens of students and their families afford a college education while providing an opportunity for contributors to give something back to their industry and add to their legacy of good works. It’s a valuable, additional benefit of membership in MRA.” MRA’s scholarship program is managed by International Scholarship and Tuition Services, Inc., in Nashville, Tennessee. A panel of educators selects the recipients based on above-average academic achievement and extracurricular involvement. Financial need is not a consideration. See special insert
stores, trying out merchandise and then ordering it online from out-of-state sellers to avoid the 6 percent sales tax they would have paid in the store. “A 6 percent savings on a $1,500 or $2,000 item is plenty incentive to go outside of Michigan,” Marshall said in a recent story run on the mlive.com Internet news site. The issue is a serious and familiar one for MRA, which has been urging public officials to level the playing field for Michigan retail stores. Retail businesses with a physical presence in the state are required to collect the state’s 6 percent sales tax. Although shoppers are required by law to pay 6 percent tax on goods they buy from out-of-state retailers, the sellers aren’t required to collect the tax on shoppers’ behalf. That loophole means most consumers aren’t aware of their tax obligation and don’t pay it. MRA has argued since at least the 1980s, when the problem first started to become serious with catalog and drop-ship furniture orders, that all sales should be treated the same regardless of where a sale takes place. “A sale is a sale is a sale,” said MRA President and CEO James P. Hallan. “With the proliferation of e-commerce Continued on page 6
Two state retailers make ‘top 100’ lists One Michigan headquartered retailer, Grand Rapids-based Meijer, made the 2011 list of the nation’s Top 100 Retailers. The National Retail Federation’s Stores magazine ranked Meijer 25th largest based on U.S. retail sales in 2010. Topping the list was Wal-Mart, followed by Kroger, Target, Walgreen and The Home Depot in the top five. All held the same spots on the 2010 list. Meijer was joined by Ada-based Amway on the magazine’s 2011 list of fastest growing retail chains. Amway ranked 83rd and Meijer 100th. Ascena Retail Group, whose major businesses are the Dress Barn, Maurices and Justice apparel chains, was named fastest growing.
Pure Michigan right in our backyard by James P. Hallan, MRA President and Chief Executive Officer A few weeks ago I had the honor of attending a “Pure Michigan” event, and I’m still feeling absolutely great about it. No, it wasn’t viewing the taping of one of the state’s highly successful tourism commercials promoting our wonderful natural resources. Rather, this was a Pure Michigan retail event hosted by Tom Ungrodt, president of Ideation, for his business customers. Ideation, based in Ann Arbor and a long-time member of Michigan Retailers, operates several Michiganbased gift stores and has developed a unique niche providing merchandise and catalogs for hundreds of gift stores and gift departments located throughout the country. To enable gift retailers to see and buy new merchandise and the direct-mail catalogs promoting it, Ideation holds buying shows throughout the year, including its recent big summer meeting that I attended. The summer show was fascinating
because it included state-of-the-art buying technology interspersed with good-old-fashioned, face-to-face sales. Normally, the shows are held out of state, usually at some attractive, popular destination. But this year was a little different. Tom and his Ideation staff decided to host their Summer Buying Meeting right here at home in Michigan and show off our state. They held it next door at Ypsilanti’s Eagle Crest Resort and capitalized on the Pure Michigan campaign by obtaining permission from Travel Michigan to co-brand their employees and guests with Pure Michigan/Ideation shirts, fans and other merchandise. In other words, they weren’t just selling Ideation, they were showcasing Michigan! It’s amazing how many people comment on the Pure Michigan ads. They are powerful and people connect with them. For example, I was in Washington,
Willis Walter ‘Bill’ Marshall The founder of the Lansing-based Marshall Music chain, who helped put music and music instruction into the lives of countless Michigan school children and assisted untold thousands of accomplished musicians throughout their careers, has died. Willis Walter “Bill” Marshall, of Okemos, passed away on June 9 at the age of 92. Following the end of World War II, Mr. Marshall and his wife, Mary, used his U.S. Army bonus to buy a small music store in Lansing. They built their business into a seven-store Michigan enterprise, now run by their son, Dan Marshall, long active in MRA Retail By Norm Feuti
and a current board member. Born in Nevada, Mr. Marshall was a member of the Army Air Corps and served as a much-decorated bomber pilot in the Asiatic Pacific Theater. He flew 62 missions and was awarded two Distinguished Flying Crosses, five air medals and a Purple Heart. He also was credited with logging the most single-engine time for any B-25 pilot in the Pacific. Mr. Marshall is survived by his three children and was preceded in death by his wife. His family requests that any memorials be made to the music or arts program of the contributor’s choice.
D . C . re c e n t l y w i t h m y re t a i l association counterparts from other states and our dinner conversation turned to the power of the Pure Michigan ads. It seemed as if everyone at the table had seen or heard the ads and was familiar with the imagery and content. For the first time in several years, my colleagues were talking about the positive Michigan brand rather than a negative image. Good stuff. Back to Ypsilanti. The night I was there, Ideation held an extraordinarily nice event in the Firehouse Museum located in the downtown’s historic district. Now, I do a lot traveling throughout the state, but I hadn’t been to the historic district in quite some time, and never to the Firehouse Museum. It contains vintage fire trucks, photographs, helmets and fire equipment from the days when Michigan was in its infancy. On my drive home, it got me to thinking about how many small museums and out-of-the way historic spots there are in Michigan. All of us should make a point to visit more of what makes Michigan so “pure.” Sometimes we look too far for an adventure, when there are treasures right in our backyard for us to enjoy. My point in all this is simple and straightforward. There’s more that each of us can do to promote as well as appreciate Pure Michigan. For inspiration we can look at a relatively small company in Ann Arbor that brought its customers to Michigan, branded its event with Michigan, served Michigan beer and wine, showcased our historic treasures and had a very successful show, right in its backyard. Nicely done!
Michigan Retailers Association Board of Directors: Barb Stein
Chair Great Northern Trading Co., Rockford
James P. Hallan
President and CEO Michigan Retailers Association
Vice Chair Ideation, Ann Arbor
Peter R. Sobelton Treasurer Birmingham
Secretary Michigan Retailers Association
Joe Swanson Past Chair Target Corp.
Marshall Music Company, Lansing
Orin Mazzoni, Jr.
Orin Jewelers, Garden City
Joseph McCurry Dovetail Alliance
Brandon Tire & Battery, Ortonville
R.D. (Dan) Musser III
Grand Hotel, Mackinac Island
D. Larry Sherman
Sherman Investments, Birmingham
John Smythe Lansing
Meijer, Inc., Grand Rapids
Michigan Retailers Services, Inc. Board of Directors: Becky Beauchine Becky Beauchine Kulka Diamonds and Fine Jewelry, Okemos
Brian Ducharme AT&T
James P. Hallan Thomas B. Scott Publisher
Publication Office: 603 South Washington Avenue Lansing, MI 48933 517.372.5656 or 800.366.3699 Fax: 517.372.1303 www.retailers.com www.mallofmichigan.com
Michigan Retailer (USPS 345-780, ISSN 0889-0439) is published in February, April, June, August, October and December for $20 per year by Michigan Retailers Association, 603 South Washington Ave., Lansing, MI 48933. Subscription fees are automatically included in the Michigan Retailers Asociation membership dues. Periodical postage paid at Lansing, Michigan. POSTMASTER: Send address changes to 603 South Washington Ave., Lansing, MI 48933. The Michigan Retailer may be recycled with other white office paper.
Little change in retail sales, but optimism rises last year, while 34 percent recorded declines and 24 percent saw no change. The results create a seasonally adjusted performance index of 52.1, down from 53.5 in May and 53.1 in April. Index values above 50 generally indicate an increase in overall retail activity. Looking forward, 45 percent of retailers expect sales during July–
September to increase over the same period last year, while 18 percent project a decrease and 37 percent no change. That puts the seasonally adjusted outlook index at 63.7, up from 60.5 in May and 60.9 in April. State sales tax receipts totaled $597.0 million in June, down 0.6 percent from a year ago. However, year-to-date sales tax collections remain 7.2 percent above last year’s
level, largely as a result of high levels of economic activity, particularly during February and March, in the motor vehicle manufacturing sector. 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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Slightly more Michigan retailers expect improved 3rd Quarter sales, following a small slip in sales performance during June, according to the latest Michigan Retail Index survey conducted by Michigan Retailers Association (MRA) and the Federal Reserve Bank of Chicago. The future-outlook portion of the Index rose by three points while the current-performance gauge dropped by nearly a point and a half during June. “We don’t see either change as very significant,” explained James P. Hallan, MRA president and chief executive officer. “Our Index numbers have been roughly the same for the past three months.” Hallan pointed to the state’s stubborn unemployment rate as a reason that sales haven’t shown much improvement this year. June’s 10.5 percent jobless rate was 0.2 points higher than May’s and the highest since 10.7 in January. “We can’t expect to see significant improvement in retail sales until the unemployment rate starts moving below double digits.” The Michigan Retail Index for June found that 42 percent of retailers increased sales over the same month
Seasonally adjusted diffusion index, calculated by adding the percent of respondents indicating increased sales and half the percent indicating no change, and then seasonally adjusting the result using the U.S. Census Bureau’s X-11 Seasonal Adjustment procedure. Index values above 50 generally indicate an increase in activity, while values below 50 indicate a decrease.
Be sure to complete your online survey each month!
NEW MEMBERS Get the Scoop, Allendale Cramer & Minock PLC, Ann Arbor Morty’s Garden Center, Ann Arbor Ervin Leasing, Ann Arbor Home Appliance Mart Inc., Ann Arbor Dragonfly Depot, Ann Arbor Sharon K, Ann Arbor State Theatre Exhibitions LLC, Ann Arbor Catherine Paxton Austin Air, Ann Arbor Everist Genomics Inc., Ann Arbor Armada Agricultural Society, Armada PetSmart, AZ Roland’s Paint & More LLC, Bad Axe Michigan Coalition of Essential Schools, Battle Creek First Presbyterian Church of Bay City, Bay City Bay City Country Club, Bay City Duncan’s Outdoor Shop Inc., Bay City Mojo’s Delicatessen, Bay City Hairworks Plus, Bellaire Pet Stop Shop, Belmont D & D Equipment & Repair LLC, Big Rapids Center Management, Birmingham Schubot Jewelers Inc., Birmingham Market Square Stores, Birmingham Blissful Living, Blissfield Bloomfield Sports Shop, Bloomfield Hills
Creative Edge Floral Design Studio, Brooklyn Johnny’s Hardware, Burton Byron Center Historical Society, Byron Center Shizzle LLC, Byron Center Pete’s Grill & Tavern, Byron Center Grand Rapids Edge, Byron Center New Hope Shelter, Cadillac Stagg Machine Products Inc., Cadillac Vogue Cleaners, Cadillac Broadway Acres Golf Course Inc., Charlotte ZDT Networks LLC, Clarkston Al’s Service Center Inc., Clio Bronco Video, Coopersville Abbas Co. LLC, Dearborn King Cole Foods Inc., Detroit Saint Stanislaus Catholic School, Dorr Hungry Village Tours, Douglas Sunes Restaurant & Bar Inc., Drummond Island Earthly Elements, East China Turke Equipment Co., East China Dollybrook Family Resort, Fennville Natural Food Patch, Ferndale Custom Sheet Metal & Heating, Free Soil 2 West Greenhouses LLC, Fruitport Dipzinski’s General Store, Gladwin Moo Cow LLC, Goodrich Smokin Mad Love, Grand Haven Lick-ity Split, Grand Ledge
Mac Tools AM Distributing, Grand Ledge Elder & Sage LLC, Grand Rapids Light Up and Live Inc., Grand Rapids Wind Waves Wheels Inc., Grand Rapids Peters Family Dentistry, Grand Rapids Schuler Books Inc., Grand Rapids Association for Human Resource Management, Grand Rapids Signcomp, Grand Rapids Vitreo-Retinal Associates PC, Grand Rapids Bella Versai Hair Studio LLC, Grand Rapids F D Lake Company, Grand Rapids James L. Wieland DDS PLC, Grand Rapids David Layne Designs, Grand Rapids Shippert Photography LLC, Grand Rapids Diamond Concrete Sawing, Grand Rapids MIOA Grand Rapids, Grand Rapids Pediatric Surgeons of West Michigan PC, Grand Rapids Boutique Emmanuel, Grand Rapids Castle Motorsports LLC, Grandville Advanced Inspection Technologies LLC, Grandville Stafford Media-Solutions Inc., Greenville LJL Nail Spa, Hamilton Gold Creations II, Harper Woods Fizzah Inc., Harrison Township Paul’s Auto & Tire, Hart American Host Inn, Hart Bussie’s Truck & Auto Inc., Holland Holland Log & Cedar Homes, Holland Holland Cakery & Sweets LLC, Holland Action Heating & Cooling Inc., Holland Compaan Door & Operator Co., Holland The Shipping Dept, Holland Great Lakes Inn, Holland Michigan Ballet Academy, Holland Caela Scott Bridal, Holland East End Radiator Service Inc., Holland Streamline Designs.com LLC, Holland Ice Cream Forest & Restaurant, Holland Copper Country Chiropractic PLLC, Houghton Michigan Tech University, Houghton Lakeshore Vinyl Products, Hudsonville Hooked on Ewe, Ionia Rick’s Shamrock Bar, Jackson Charlie’s Pub & Grill Inc., Jackson Fabri-Tech Inc., Jenison Suzanne’s Organic Salon & Boutique, Kalamazoo Kalamazoo Bach Festival, Kalamazoo The Candy Lady, Kalamazoo Seoul Garden Restaurant, Kentwood Maki Chiropractic Inc., Kingsford Capitol Communication Systems Inc., Lansing First Christian Church Lansing, Lansing DeHaven Real Estate Co., Lansing InterCarrier Networks LLC, Lansing Silver Service Catering LLC, Lansing
Mancino’s, Lansing The Town Shoppe, Lexington Sattar Inc., Lincoln Park Weldcraft Inc., Livonia Motor City Quick Lube Corp., Livonia Tinklenberg Consulting Group LLC, Lowell Kent County Youth Agricultural Association, Lowell Chuck Wagon Pizza, Ludington Benevolent & Protective Order of Elks, Ludington Lakeshore Whole Health, Ludington Yada Yada Resale, Ludington Decked Out, Mackinac Island Action WDI Specialists Inc., Manistee Douglas Valley, Manistee NAPA of Manistee, Manistee Marquette Breakfast Rotary, Marquette Superior Window Treatments LLC, Marquette Marquette Fence Co., Marquette Quicktrophy LLC, Marquette Marquette Board of Light & Power, Marquette Vacation Villas of Orlando LLC, Mason Westview Farm, Mattawan Cook’s Lakeside Marine Repair & Service, Mears Val Du Lakes Promotions & Entertainment, Mears Foran Interior Design LLC, Metamora Rehabilitation Associates of Mid-Michigan, Midland Holiday Companies, MN Evolved Art Forms, Mount Pleasant Heron Kwe Massage Therapy, Mount Pleasant The Mole Hole, Mount Pleasant Free Spirit Construction Inc., Muskegon KJ’s Restaurant, National City Shellys Floral Boutique, Negaunee Negaunee Public Schools, Negaunee Polly’s Place Niles Inc., Niles Omena Natural Foods, Northport Point Place Ace Hardware, OH Perkins Family Diner, Perkins Westlake Drugs Inc., Portage Modern Art Jewelers, Rochester Williams Creek LLC, Rochester Silver Lake Country Club, Rockford Higgins Lake Cafe, Roscommon Tip Top Liquor & Wine Shoppe, Royal Oak Billings Lawn Equipment, Royal Oak Presbytery of Lake Huron, Saginaw Voyageur Trading Post, Saint Ignace Hospice of the Eastern UP, Sault Sainte Marie Woods To Be Trees, Sawyer Skandia Truss, Skandia AJ’s Place, South Haven Superior International Wholesale LLC, Sparta Sparta Farmers Market, Sparta On The Rocks Inc., Traverse City OTEC Management Inc., Traverse City A Tanner & Sons Roofing, Walkerville Emergency Fleet Service, Warren Hopman’s Beer &Wine Making Supply, Waterford Schmidt Outfitters, Wellston Artex Label, Zeeland
RETAIL TECHNOLOGY NEWS
Guard your customer data against inside threats, too John Mayleben, MRA’s senior vice president, technology and product development, writes a regular column on retail technology. Contact firstname.lastname@example.org. While waiting in line at a local fast food restaurant recently, I noticed a sign that you would normally only see in the breakroom or on an employee bulletin board out of sight from the customers. It was titled (in the giant-sized headline usually reserved for major news events) “Credit Card Fraud is a Federal Crime” and went on to advise the employees of this chain of restaurants that capturing, or “skimming,” a card number from a customer’s card is a crime, even if you don’t use the card number to purchase something. The simple act of skimming the card number with the intent to sell or give it to a bad guy can result in a 10-year sentence at the federal level, plus other state laws may also apply. This notice reminded me that, much like shoplifting, you can’t just work on protecting your company from outside bad guys. The sorry fact is that you also need to look inward to make sure you have appropriate procedures in place for staff. As with theft of merchandise, the inside job will probably result in a higher loss and go on for a lot longer. If you have not already done so, you should take a minute and watch what happens to a credit card transaction within your business and see if you can determine weak points in the process. You should be watching for points where card data are left “alone” with just one person. Does the employ-
ee take the consumer’s card (or the card information in a non face-to-face transaction) and have time to secretly record this data? While most transactions in a faceto-face environment occur in front of the consumer, and in theory the consumer is watching the card during the transaction, some don’t. These include a drive-through shopping experience or a sit-down restaurant. Some businesses offer shopping experiences where there may be a time that the customer is not near
In terms of security, think of card data as cash.
Looking for the best way to reach retailers in Michigan?
the credit card terminal during the transaction. If your business model has these types of situations, you should be even more alert to behaviors of staff members and to calls from cardholders indicating anomalies with their cards after purchasing something from your store. In one recent case, a retailer hired a staff member who was fluent in a second language to handle calls from customers who did not speak English. Knowing he was the only employee who spoke the other language, the employee decided to steal card data only from customers who spoke that language. He knew that any complaints would be routed through him for translation, and he could control the situation. Think of card data as cash. You have systems and procedures in place to control access to cash, and you should be doing the same thing with card data!
Advertise in the Michigan Retailer. Rates as low as $35 per issue.
Call 800.366.3699 for more information.
6 Summary Annual Report for the Michigan Retailers Association Multiple Employer Welfare Arrangement Dental Plan and Trust This is a summary of the annual report of the Michigan Retailers Association Multiple Employer Welfare Arrangement Dental Plan and Trust for the 12 months ended December 31, 2010. The annual report has been filed with the Internal Revenue Service, as required under the Employee Retirement Income Security Act of 1974 (ERISA), Tax ID #38-3090275. Michigan Retailers Association MEWA has committed itself to pay all dental claims incurred under the terms of the plan. Insurance Information The plan has contracted with Delta Dental Plan of Michigan to pay claims incurred under the terms of the plan. The total premiums paid for the plan year ending December 31, 2010, were $724,231. Because it is a socalled “experience-rated” contract, the premium costs are affected by, among other things, the number and size of claims. Basic Financial Statement The value of plan assets, after subtracting liabilities of the plan, was $743,286 as of December 31, 2010, compared to $707,575 as of the beginning of the plan year. During the plan year the plan experienced an increase in its net assets of $35,711. This increase includes unrealized appreciation and depreciation in the value of plan assets; that is, the difference between the value of the plan’s assets at the end of the year and the value of the assets at the beginning of the year or the cost of assets acquired during the year. During the plan year, the plan had total income of $733,117, including employer and employee contributions of $724,231 and earnings from investments of $8,886. Plan expenses were $697,406. These expenses included $50,925 in administrative expenses, $567,893 in benefits paid to participants and beneficiaries, and $78,588 in other expenses. Your Rights to Additional Information You have the right to receive a copy of the full annual report, or any part thereof, on request. The items listed below are included in that report: 1. An accountant’s report; 2. Assets held for investment; 3. Fiduciary information, including transactions between the plan and parties-in-interest (that is, persons who have certain relationships with the plan); 4. Loans or other obligations in default; 5. Leases in default; 6. Transactions in excess of 3 percent of plan assets. To obtain a copy of the full annual report, or any part thereof, write or call the office of Michigan Retailers Services, Inc., 603 South Washington Avenue, Lansing, Michigan 48933 (517.372.5656). The charge to cover copying costs will be $5.00 for the full annual report, or $.40 per page for any part thereof. You also have the right to receive from the plan administrator, on request and at no charge, a statement of the assets and liabilities of the plan and accompanying notes, or both. If you request a copy of the full annual report from the plan administrator, these two statements and accompanying notes will be included as part of that report. The charge to cover copying costs given above does not include a charge for the copying of these portions of the report because these portions are furnished without charge. You also have the legally protected right to examine the annual report at the main office of the plan: Michigan Retailers Association, 603 South Washington Avenue, Lansing, Michigan 48933, and at the U.S. Department of Labor in Washington, D.C., or to obtain a copy from the U.S. Department of Labor upon payment of copying costs. Requests to the Department should be addressed to Public Disclosure Room, N4677, Pension and Welfare Benefit Programs, U.S. Department of Labor, 200 Constitution Avenue NW, Washington, DC 20216.
Summary Annual Report for the Michigan Retailers Association Multiple Employer Welfare Arrangement Dental Plan and Trust This is a summary of the annual report of the Michigan Retailers Association Multiple Employer Welfare Arrangement Dental Plan and Trust for the 12 months ended December 31, 2009. The annual report has been filed with the Internal Revenue Service, as required under the Employee Retirement Income Security Act of 1974 (ERISA), Tax ID #38-3090275. Michigan Retailers Association MEWA has committed itself to pay all dental claims incurred under the terms of the plan. Insurance Information The plan has contracted with Delta Dental Plan of Michigan to pay claims incurred under the terms of the plan. The total premiums paid for the plan year ending December 31, 2009, were $761,286. Because it is a socalled “experience-rated” contract, the premium costs are affected by, among other things, the number and size of claims. Basic Financial Statement The value of plan assets, after subtracting liabilities of the plan, was $707,575 as of December 31, 2009, compared to $678,619 as of the beginning of the plan year. During the plan year the plan experienced an increase in its net assets of $28,956. This increase includes unrealized appreciation and depreciation in the value of plan assets; that is, the difference between the value of the plan’s assets at the end of the year and the value of the assets at the beginning of the year or the cost of assets acquired during the year. During the plan year, the plan had total income of $777,142, including employer and employee contributions of $761,286 and earnings from investments of $15,856. Plan expenses were $748,816. These expenses included $55,031 in administrative expenses, $608,068 in benefits paid to participants and beneficiaries, and $85,087 in other expenses. Your Rights to Additional Information You have the right to receive a copy of the full annual report, or any part thereof, on request. The items listed below are included in that report: 1. An accountant’s report; 2. Assets held for investment; 3. Fiduciary information, including transactions between the plan and parties-in-interest (that is, persons who have certain relationships with the plan); 4. Loans or other obligations in default; 5. Leases in default; 6. Transactions in excess of 3 percent of plan assets. To obtain a copy of the full annual report, or any part thereof, write or call the office of Michigan Retailers Services, Inc., 603 South Washington Avenue, Lansing, Michigan 48933 (517.372.5656). The charge to cover copying costs will be $5.00 for the full annual report, or $.40 per page for any part thereof. You also have the right to receive from the plan administrator, on request and at no charge, a statement of the assets and liabilities of the plan and accompanying notes, or both. If you request a copy of the full annual report from the plan administrator, these two statements and accompanying notes will be included as part of that report. The charge to cover copying costs given above does not include a charge for the copying of these portions of the report because these portions are furnished without charge. You also have the legally protected right to examine the annual report at the main office of the plan: Michigan Retailers Association, 603 South Washington Avenue, Lansing, Michigan 48933, and at the U.S. Department of Labor in Washington, D.C., or to obtain a copy from the U.S. Department of Labor upon payment of copying costs. Requests to the Department should be addressed to Public Disclosure Room, N4677, Pension and Welfare Benefit Programs, U.S. Department of Labor, 200 Constitution Avenue NW, Washington, DC 20216.
50/50 Raffle comes back by M. Scott Bowen, Commissioner
The Lottery is bringing back the popular Ultimate 50/50 Raffle, and this time there are more chances to win. Tickets will be available for purchase from August 15 through September 28. One raffle winner will walk away with a huge prize! The Lottery’s Ultimate 50/50 Raffle will operate like a standard 50/50 raffle you might see at a local sporting event: the jackpot grows with every ticket sold and the winner receives half of the take. Single wagers are $5 each, and the more tickets you buy, the more you save: five wagers cost $20; 15 wagers cost $50; and 40 wagers cost $100. Like other raffles, unique seven-digit numbers will be printed on players’ tickets starting with 0000001 until sales end on September 28. On September 29, a drawing will be conducted to select one winning raffle number. The size of the jackpot depends on how many tickets are purchased, and the jackpot grows with every ticket sold. For every dollar wagered, $0.50 goes into the jackpot. The jackpot will be updated on a regular basis each day on Club Keno monitors and Altura displays. Players will also be able to get jackpot updates at the Michigan Lottery website, www.michiganlottery.com. Unlike other 50/50 raffles, this time the Ultimate 50/50 Raffle offers a twist. Five bonus drawings will be
conducted to give players additional opportunities to win $25,000. 50/50 Raffle tickets will be automatically entered into the bonus drawings as soon as they are purchased. The bonus prize-winning raffle numbers will be posted on the website. Bonus prize winners are still eligible for the final raffle drawing in September. Make sure you tell your customers to hold onto their tickets; they will have to present the original raffle ticket to the Lottery office to claim any prize. Raffle tickets will be available at all Michigan Lottery retailers, and the retailer that sells the winning raffle ticket will receive a $5,000 bonus commission, regardless of the jackpot size. Remember, time is limited to purchase tickets, so be sure to let your customers know they have to act fast in order to be part of the raffle action. New Instants New instant tickets scheduled to go on sale on August 8 included Cash Vault™ ($1), Sapphire Blue Wild Time™ ($2), Lucky Red 7s™ ($2), and Sky’s The Limit™ ($5). Fat $50’s™ ($1), Bonus Number Bingo™ ($2), Kings & Queens™ ($2), and $1,000,000 Diamonds™ ($20) are scheduled to go on sale on August 29. Over 94 cents of every dollar spent on Lottery tickets is returned to the state in the form of contributions to the state School Aid Fund, prizes to players and commissions to retailers. In fiscal year 2010, the contribution to schools was $701.3 million. Since its inception in 1972, the Lottery has contributed more than $15 billion to education in Michigan.
Main St. Fairness support growing Continued from page 1
retailers, the problem has become significant,” he told the mlive.com reporter. More stories about the unfairness of the current system and the burden it causes Michigan-based retailers — Marshall estimates he loses about 15 percent of potential sales to online competitors — have been showing up in the news media in recent months as MRA builds support for a legislative solution to the problem. Building a coalition of businesses is picking up speed. Some 300 small businesses have joined the coalition so far and more are added every week, said Hallan. Businesses can learn more about the issue, listen to other small business owners discuss the impact of this loophole on their business, and join the coalition by visiting www. standwithmainstreet.com/michigan.
At the same time as Michigan and other states attempt to find state solutions to the problem, federal legislation has been introduced to enact a nationwide remedy. U.S. Rep. John Conyers, a Detroit Democrat, recently introduced the Main Street Fairness Act to give states such as Michigan that have streamlined sales tax rules the ability to collect sales tax from all online retailers. U.S. Sen. Dick Durbin, an Illinois Democrat, introduced a similar bill in the Senate. “A federal solution would be the simplest remedy,” said Hallan. “However, we also know the difficulty of getting anything through Congress, so we will continue to pursue a solution at the state level. That’s our quickest and best remedy for the foreseeable future.”
‘We sell more because…Delores works here’ Tenth and last in a series on “Managed Common Sense” by Steve Flaster Our series on “managed common sense” ends the way it started…by asserting and reasserting that retailing is a business about people. Have you ever noticed that you tend to favor and frequent only certain branches of a store or restaurant chain? While this is not what corporate management wants, it’s the way things often wind up. Corporate chains want to create a standardized format and experience so that you always choose the business with their name on the door. But this standardized approach often fails, because you can’t standardize one critical variable…people. We favor one branch over another because of the people who staff it. Joe DePinto, CEO of 7-Eleven, was featured recently on a fascinating television program called Undercover Boss, in which heads of large retail and other companies go “undercover” to learn what’s really happening in the field. In the case of 7-Eleven, its board wanted to know why one particular branch sold an inordinately large amount of brewed coffee. So the “boss” took a job as stock help at that branch and then watched and learned. Ever y morning he would see people swarm to the store and be warmly greeted and hugged by a staff member named Delores. She was like a good-luck charm for starting the customer’s day. She remembered names and family situations and would never let her “friends” serve themselves. Make or break Mr. DePinto reported back to his board: “We don’t sell more coffee because we have better coffee…we sell more because we have Delores.” Sorry Joe, but even if you are now a television star, customers are more likely to remember Delores and others like her who take care of them. And that is the way it should be. The people who work in each 7-Eleven, and in all of our stores, are the people customers see as the face, the heroes or villains, and the “make or break” forces in our businesses. We should appreciate, properly train, motivate and reward our staff so they are and remain heroes to our customers. We should also understand — and tell staff — that they have the power to differentiate their particular branch through
individual effort and outstanding customer ser vice...and, yes, be rewarded accordingly for doing so. More and more, we hear about large corporations that are trying to create an entrepreneurial spirit within their walls. They are trying to walk the fine line between structure and freedom. This is a worthy goal but no easy task. Top management needs to create a culture of situational flexibility so that staff don’t destroy the company through blind adherence to policies. In Fifty Powerful Ideas You Can Use to Keep Your Customers, Paul Timm talks about the supermarket employee who foolishly refused to take back a $1.19 head of lettuce. While he upheld policy, he lost several thousand dollars in future business and customer loyalty. Such staff are heroes neither to store nor customer. They don’t understand what counts and, unfortunately, may have their own personal agendas. As we said in a previous column, locally owned smaller retailers traditionally have the upper hand in people relations. They should maximize this strength to effectively compete with larger
stores and chains. Creative merchants Many think that bookstores are a dying breed and will be completely replaced by e-commerce. Fortunately, there are still creative merchants who see how bookstores can be saved and can thrive through exciting store experiences involving people. The Kindle is a wonderful innovation, but it can’t take the place of meeting an author over champagne and having him sign your copy in the intimate setting of a bookstore. Buying a book on the web just doesn’t have that warm and fuzzy experience you get in a store with staff sharing their favorite selections…at least not yet. In today’s competitive soci ety, customers are paying for experiences and not just physical products. Experiences are created by people called staff, and it is not just the bookstore that can differentiate itself based on customer experience. Wine merchants, to name just one example, can have events that show us how to have a fabulous cocktail party. And don’t forget, all good retailing
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experiences include the opportunity and inspiration to buy merchandise. In the end, smart retailers understand that customers and staff are the most important groups of people who affect retail success. Smart retailers use technology as a tool and a means for improving the ability of staff to service customers. As retailers, we all increase our chances for success when we remember that people are both our best investment and greatest asset. Note: My wife and I are embarking on an extended trip to America’s great West Coast. Starting with a “pilgrimage” to the first Starbucks in Seattle and ending with visits to the retailing palaces of Las Vegas, we hope to discover many lesser known but successful retailing ideas and formats along the way. We’ll report what we find. Steve Flaster is a retailer, instructor of retailing and marketing at Michigan State University, speaker and consultant. To reach him at Yes for Success Retail Consulting, call 517.655.6979 or email email@example.com.
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