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INTRODUCTION 

The U.S. Census Bureau produces the Annual Revision of Monthly Retail and 

Food Services to provide revised national estimates by kind of business of 

monthly sales for establishments classified in the retail trade and food services 

industries. Revised estimates of end-of-month inventories and inventory-tosales ratios are also provided, but only for retail trade. 

 

We develop the estimates in this report using data from the Advance Monthly 

Retail Trade and Food Services Survey (MARTS), Monthly Retail Trade 

Survey (MRTS), Annual Retail Trade Survey (ARTS), and administrative 

data. For each survey, questionnaires are mailed to a probability sample of 

firms located in the United States and having paid employees. The samples 

are updated regularly and periodically reselected. These samples include 

firms of all sizes. Firms without paid employees (nonemployers) are included 

in the ARTS estimates through administrative data provided by other Federal 

agencies and through imputation. Nonemployers are represented in the 

monthly retail estimates via the procedure used to benchmark the monthly 

estimates using ARTS results. 

Additional information on MARTS, MRTS, and ARTS can be found on the 

Census Bureau Web site at <http://www.census.gov/retail>. 

 

COVERAGE 

The estimates in this publication are summarized by industry classification 

based on the 2007 North American Industry Classification System (NAICS). 

NAICS groups establishments into industries based on the activities in which 

they are primarily engaged. This system, developed jointly by the statistical 

agencies of Canada, Mexico, and the United States, allows for comparisons of 

business activity across North America. 

 

Retail trade, as defined by NAICS sectors 44-45, includes establishments 

engaged in selling merchandise in small quantities to the general public, 

without transformation, and rendering services incidental to the sale of 

merchandise. Two principal types of establishments classified in retail trade 

are distinguished: 

 

1. Store retailers operate fixed point-of-sale locations, located and designed 

to attract a high volume of walk-in customers. They have extensive displays of 

merchandise, use mass-media advertising to attract customers and typically sell 

merchandise to the general public for personal or household use. Some store 

retailers also provide after-sales services, such as repair and installation; for 

example, new automobile dealers. 

2. Nonstore retailers also serve the general public, but their retailing methods 

differ. Such methods include paper and electronic catalogs, door-to-door 

solicitation, in-home demonstration, ‘‘infomercials,’’ selling from portable stalls 

or through vending machines. 
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Food services, as defined by NAICS subsector 722, include establishments 

that prepare meals, snacks, and beverages to customer order for immediate onpremises and off-premises consumption. 

 

A summary of changes from the prior report and the procedures for producing 

the revised estimates are described below. 

REVISIONS TO PREVIOUSLY PUBLISHED ESTIMATES 

 

Not Adjusted Estimates 

Not adjusted estimates of monthly sales are revised for January 1992 through 

February or March 20121

 (if an advance sales estimate is computed), as well 

as end-of-month inventory estimates for January 1992 through February 2012. 

We revised the not adjusted estimates to: 

• Reflect corrections to data for the current MARTS, MRTS, and ARTS 

samples. Corrections are made to replace previously reported data with more 

accurate data received at a later date, or to replace imputed data with reported 

data obtained from the company. 

• Introduce results from the 2010 ARTS, which have been benchmarked using 

the final results of the 2007 Economic Census. 

• Incorporate revisions to the annual nonemployer estimates for 2009 and all 

previous years to reflect improvements in the coverage of nonemployer 

businesses (i.e., businesses with no paid employees) that were implemented 

with the release of the 2009 Nonemployer Statistics. For additional 

information on these improvements and their effect on the nonemployer totals, 

see the Nonemployer Statistics home page at 

http://www.census.gov/econ/nonemployer/index.html. For information on 

how these revisions were incorporated into the Annual Retail Trade Survey 

estimates, please see the “Non-employers” section at 

http://www.census.gov/retail/arts/how_surveys_are_collected.html. 

• Link the previously published estimates from the prior MRTS sample to 

estimates from the current MRTS sample. 

 

Estimates of Monthly Sales 

For select detailed NAICS codes, corrections are applied to the monthly retail 

and food service sales estimates for August 2006 through February 2012. 

Then, for each detailed NAICS code, the monthly retail and food service sales 

estimates for January 1992 (the beginning of the series) through August 2006 

are linked to the estimates derived from the current sample. The linkage is 
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performed at each detailed NAICS level by multiplying the sample-based 

estimates prior to September 2006 by a geometric mean. The geometric mean 

is computed as the square root of the product of two ratios. The numerators of 

the ratios are the Horvitz-Thompson sales estimates for August and September 

2006 from the current sample. The denominators of the ratios are the HorvitzThompson estimates for August and September 2006 from the prior sample. 

After performing the above linkage, the resulting sales estimates for January 

1992 through February 2012 are input to the benchmarking program. The 

estimates for a given detailed NAICS code are revised in a manner that— 

• For 1992 through 2010, constrains the sum of the 12 monthly sales estimates 

to equal the corresponding annual sales estimate from ARTS. 

• Minimizes the sum of the squared differences between the month-to-month 

changes of the input and revised estimates for January 1992 through February 

2012. 

If a March 2012 advance sales estimate is computed for an industry, the 

estimate may also be revised based on historical corrections made to data for 

February or March 2012. For more information on how advance estimates are 

computed, see the Census Bureau Web site at 

<http://www.census.gov/retail/marts/how_surveys_are_collected.html>. 

A mathematical result of the benchmarking methodology is that, for a given 

NAICS code, all published monthly sales estimates after December 2010 are 

derived by multiplying the Horvitz-Thompson estimates by the ratio of the 

benchmarked-to-input estimate for December 2010. This ratio, which is called 

a carry-forward factor, remains the same and is used to derive published 

monthly sales estimates until the next benchmarking operation. 

Revised estimates for aggregate industry levels are computed by summing the 

revised estimates for the appropriate detailed industries comprising the 

aggregate. 

 

Estimates of End-of-Month Inventories 

For select detailed NAICS codes, corrections are applied to the retail end-ofmonth inventory estimates for August 2006 through February 2012. Then, for 

each detailed NAICS code, the end-of-month inventory estimates for January 

1992 (the beginning of the series) through August 2006 are linked to the 

estimates derived from the current sample. The linkage is performed using a 

procedure similar to the one used for sales, except the geometric mean is 

based on end-of-month inventory. 

After performing the above linkage, the resulting end-of-month inventory 

estimates for January 1992 through February 2012 are input to the 

benchmarking program. The estimates for a given detailed NAICS code are 
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revised in a manner that— 

• For 1992 through 2010, constrains the December end-of-month inventory 

estimates from MRTS to equal the end-of-year inventory estimates derived 

from ARTS. 

• Minimizes the sum of squared differences between the month-to-month 

changes of the input and revised estimates for January 1992 through February 

2012. 

 

For a given detailed NAICS code, end-of-month inventory estimates 

subsequent to December 2010 are derived by multiplying the input estimates 

by the ratio of the benchmarked-to-input estimate for December 2010. This 

ratio is the carry-forward factor for inventory, and it remains the same until 

the next benchmarking operation. 

Revised estimates for aggregate industry levels are computed by summing the 

revised estimates for the appropriate detailed industries comprising the 

aggregate. 

Seasonally Adjusted Estimates 

New seasonal, trading-day, and holiday factors are computed and used to adjust sales for 

January 1992 through February or March 2012 (if an advance sales estimate is 

computed). For inventories, new seasonal factors are computed and used to adjust 

inventories for January 1992 through February 2012. For both sales and inventories, the 

new seasonal factors are computed using the revised not adjusted estimates as input to the 

seasonal adjustment program. For both sales and inventories, the new seasonal factors are 

computed using the revised unadjusted estimates as input to the Census Bureau’s X13ARIMA-SEATS software. 

The X-13ARIMA-SEATS software improves upon the X-12-ARIMA seasonal 

adjustment software by providing enhanced diagnostics as well as incorporating an 

enhanced version of the Bank of Spain’s SEATS (Signal Extraction in ARIMA Time 

Series) software, which uses an ARIMA model-based procedure instead of the X-11 

filter-based approach to estimate seasonal factors. The X-13ARIMA-SEATS and X-12-

ARIMA software produce identical results when using X-13ARIMA-SEATS with the X11 filter-based adjustments. The X-13ARIMA-SEATS software will be available from 

the Census Bureau’s Internet site in the coming months. 

Note that the retail estimates continue to be adjusted using the X-11 filter-based 

adjustment procedure. 

REVISIONS OF SALES AND INVENTORIES 

The following table shows a comparison of the revised sales and inventories 

to the previously published estimates for 2011: 
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2011 Retail and Food Services Sales and Retail Inventories Comparison of the 

Revised Estimates to the Previously Published Estimates

Reasons for Revisions 

There are several reasons for revisions. The main contributors to the revision 

from the previously published estimates are: 

 

 Timing. The respondents have more time to prepare their annual and 

census reports than they do for their monthly reports. The annual and census 

responses are requested at a time when many firms have already compiled audited 

book figures for their own use. The timing of the annual survey is such that we 

are also able to obtain independent verification of the reported data from such 

sources as a company’s annual report. On the other hand, respondents to the 

monthly survey have just a few weeks to provide reports of their sales and end-ofmonth inventories. Sometimes these reports are based on incomplete or unaudited 

records and may include estimates made by respondents to represent their 

understanding of their business. 

 Sampling. As described in more detail in the Technical Documentation, 

the estimates derived from the annual survey are based on a sample that is much 

larger than the samples used to produce the monthly sales or inventory estimates. 

 Response. The annual estimates are based on more reported data than 

are the monthly estimates. The response to the ARTS is required by law, while the 

MRTS is voluntary. This requirement results in a total quantity response rate 

(TQRR) of 93 percent for sales and 93 percent for inventories and a rate of 

approximately 72 percent for sales and 69 percent for inventories for MRTS. An 

imputation process accounts for the sales and inventories data that fail edits or are 

missing because of nonresponse. For MRTS, this process assumes that 

nonresponding firms have similar month-to-month changes to the responding 

firms of a similar size in the same industry. However, the ARTS imputation 

process relies heavily on administrative data and relationships of these data for 

each individual form, which could result in different data being tabulated for the 

MRTS and ARTS for nonresponding firms. 

DEFINITION OF TERMS 

Dollar Values 

All dollar values presented are expressed in current dollars; that is, the 

estimates are not adjusted to a constant dollar series. Consequently, when 

comparing estimates to prior years, users also should consider price level 

changes. 

Confidentiality 

Title 13 of the United States Code authorizes the Census Bureau to conduct 

censuses and surveys. Section 9 of the same Title requires that any 

information collected from the public under the authority of Title 13 be 
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maintained as confidential. Section 214 of Title 13 and Sections 3559 and 

3571 of Title 18 of the United States Code provide for the imposition of 

penalties of up to 5 years in prison and/or up to $250,000 in fines for wrongful 

disclosure of confidential census information. In accordance with Title 13, no 

estimates are published that would disclose the operations of an individual 

firm. 

 

The Census Bureau's Internal Disclosure Review board sets the confidentiality 

rules for all data releases. A checklist approach is used to ensure that all 

potential risks to the confidentiality of the data are considered and addressed. 

Disclosure Limitation 

A disclosure of data occurs when an individual can use published statistical 

information to identify either an individual or firm that has provided 

information under a pledge of confidentiality. Disclosure limitation is the 

process used to protect the confidentiality of the survey data provided by an 

individual or firm. Using disclosure limitation procedures, the Census Bureau 

modifies or removes the characteristics that put confidential information at 

risk for disclosure. Although it may appear that a table shows information 

about a specific individual or business, the Census Bureau has taken steps to 

disguise or suppress the original data, while making sure the results are still 

useful. The techniques used by the Census Bureau to protect confidentiality in 

tabulations vary, depending on the type of data. 

Unpublished Estimates 

It should be noted that some unpublished estimates can be derived directly 

from this report by subtracting published estimates from their respective 

totals. However, the estimates obtained by such subtraction would be subject 

to the poor response rates or high sampling variability. 

Individuals who use estimates in this report to create new estimates should 

cite the Census Bureau as the source of only the original estimates. 

Adjustment Factors 

The X-13ARIMA-SEATS program (version 1.0, build 148) was used to 

derive the factors for adjusting estimates for seasonal variations and, in the 

case of sales, for trading-day and holiday differences. Not adjusted sales and 

inventory estimates for January 1992 through February or March 20121

 (if an 

advance sales estimate was computed) were input to this program. 

 

The X-13ARIMA-SEATS software improves upon the X-12-ARIMA 

seasonal adjustment software by providing enhanced diagnostics as well as 

incorporating an enhanced version of the Bank of Spain’s SEATS (Signal 

Extraction in ARIMA Time Series) software, which uses an ARIMA modelbased procedure instead of the X-11 filter-based approach to estimate seasonal 

factors. The X-13ARIMA-SEATS and X-12-ARIMA software produce 

identical results when using X-13ARIMA-SEATS with the X-11 filter-based 

adjustments. The X-13ARIMA-SEATS software will be available from the 

Census Bureau’s Internet site in the coming months. 
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Seasonal adjustment of estimates is an approximation based on current and 

past experiences. Therefore, the adjustment could become less precise because 

of changes in economic conditions and other elements that introduce 

significant changes in seasonal, trading-day, or holiday patterns. 

Sales 

Sales include merchandise sold (for cash or credit at retail or wholesale) by 

establishments primarily engaged in retail trade. Services that are incidental to 

the sale of merchandise, and excise taxes that are paid by the manufacturer or 

wholesaler and passed along to the retailer are also included. Sales are net, 

after deductions, for refunds and allowances for merchandise returned by 

customers. Sales exclude sales taxes collected directly from customers and 

paid directly to a local, state, or federal tax agency. 

 

The estimates of sales measure the operations receipts rendered by stores that 

primarily sell at retail. The sales estimates represent total sales and receipts of 

all establishments primarily engaged in retail trade. They do not include sales 

at retail by manufacturers, wholesalers, service establishments, and others 

whose primary activity is other than retail trade. Because the retail 

establishment is the basic unit of measure, the published estimates of sales by 

type of retail store are not intended to measure the total sales for a given 

commodity or merchandise line. 

Inventories 

Merchandise inventories are the value of stocks of goods held for sale. The 

inventories estimates represent the value, at cost, of the merchandise available 

for sale as of the last day of the report period. Methods of valuation may vary 

according to the accounting practices of each firm. The estimates provided in 

this report are valued on a non-LIFO (last in, first out) basis. Note—LIFO is a 

method of valuing inventory where the latest items of merchandise added to 

the inventory are the first ones taken out. Non-LIFO would mean that another 

method, such as FIFO (first in, first out), was used to establish the value of the 

inventory available for sale. Merchandise inventories are shown for stores and 

warehouses servicing retail establishments. Included are only those 

warehouses that maintained supplies of merchandise primarily intended for 

distribution within the organization. 

Inventories/ Sales Ratios 

The inventories/ sales ratios show the relationship of the end-of-month values 

of inventory to the monthly sales. These ratios can be looked at as indications 

of the number of months of inventory that are on hand in relation to the sales 

for a month. For example, a ratio of 2.5 would indicate that the retail stores 

have enough merchandise on hand to cover two and a half months of sales. 

Leased Department 

Leased departments are broadly defined as operations of one company 

conducted within the establishment of another company. Typical examples 

may include jewelry counters or optical centers within department stores. 
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GAFO 

GAFO represents sales at stores that sell merchandise normally sold in 

department stores. GAFO includes the following kinds of retail businesses: 

 

 General merchandise stores (NAICS 452). 

 Clothing and clothing accessories stores (NAICS 448). 

 Furniture and home furnishings stores (NAICS 442). 

 Electronics and appliance stores (NAICS 443). 

 Sporting goods, hobby, book, and music stores (NAICS 451). 

 Office supplies, stationery, and gift stores (NAICS 4532). 

 

ADDITIONAL INFORMATION 

E-Commerce Data

Data for e-commerce sales and electronic data interchange (EDI) can be found 

on the Census Bureau Web site at<http://www.census.gov/econ/estats>. 

Survey Questionnaires 

The ARTS questionnaires can be found on the Census Bureau Web site at 

<http://www.census.gov/retail/arts/get_forms.html>. The MRTS 

questionnaires can be found on the Census Bureau's Web site at 

<http://www.census.gov/retail/mrts/get_forms.html>. 

 

1 Advance sales estimates are computed for selected kinds of business and are based on a small subsample 

selected from the larger MRTS sample.

 

Related Links:

Monthly Retail Trade Survey

Annual Retail Trade Survey

Advance Monthly Retail Trade & Food Services

Source: Retail Indicators Branch, U.S. Census Bureau 

Last Revised: April 30, 2012