Archive for October, 2009

Companies are carrying less debt now as a result of the financial crisis

Thursday, October 29th, 2009

The data below show that business loans have been contracting.
The contraction is likely the result of companies paying down debt and shrinking inventories over significantly slower sales throughout the downturn. Tightened credit terms have also contributed to the trend.
The table here lists the debt to equity ratio since 2003 for the overall private sector and three large sectors, construction, manufacturing, and retail. Overall, debt to equity decreased in the private sector and in the broad manufacturing and retail trade sectors over the downturn in 2008.

Industry

Financial Metric

2003

2004

2005

2006

2007

2008

2009

Average for All Privately-Held Companies

Debt To Equity

2.6

2.64

2.69

2.71

2.72

2.57

2.56

23 - Construction  (private)

Debt To Equity

2.36

2.37

2.41

2.42

2.38

2.12

2.16

31, 32, 33 - Manufacturing  (private)

Debt To Equity

2.11

2.18

2.2

2.28

2.29

2.2

1.79

44, 45 - Retail Trade  (private)

Debt To Equity

2.41

2.6

2.63

2.65

2.59

2.7

2.26

Retail Data - What IS Selling

Friday, October 23rd, 2009

We heard last week that retail sales declined 1.5% from last month; here is a look at small business retailers and what is selling: 

Industry

Financial Metric

2007

2008

Last 12 Months

4541 - Online Stores and Mail-Order Houses

Sales Pct Change

6.32%

5.91%

6.80%

4451 - Grocery Stores

Sales Pct Change

5.61%

6.18%

6.64%

4452 - Specialty Food Stores 

Sales Pct Change

7.11%

6.79%

6.64%

4511 - Sporting Goods & Stores 

Sales Pct Change

3.27%

3.18%

3.90%

4461 - Health and Personal Care Stores 

Sales Pct Change

4.13%

4.17%

3.88%

4442 - Lawn and Garden Equipment and Supplies Stores 

Sales Pct Change

5.02%

2.76%

2.43%

4453 - Beer, Wine, and Liquor Stores 

Sales Pct Change

6.01%

1.59%

0.88%

The data shows that consumers are still opening their wallets for necessities like food and shampoo, but there are some surprises in there as well. Online-only stores have seen sales growth of almost 7% over the past year.  The increase in this sector jives with what we heard about Amazon’s earnings today.