What Are ICSC-UBS Store Sales?

The International Council of Shopping Centers (ICSC) and UBS Securities LLC provide a weekly joint publication known as the ICSC-UBS retail chain store sales index. It measures the portion of retail sales attributed to general merchandise and represents about 80 retail chain stores. The ICSC-UBS store sales index measures same-store sales and excludes restaurant and vehicle demand.

The weekly publication is released every Tuesday at 7:45 AM ET, with data on the week ended the prior Saturday. The two percentages that are reported are the:

  • Week-to-week change from the prior week
  • Year-over-year change for the week from the prior year

Real-World Example Of ICSC-UBS Store Sales

On September 13, 2005, the ICSC-UBS store sales index reported a sales decrease of 0.2% in the week ending September 10, compared to the previous week. It also reported an increase of 3.5% in sales compared to the same week a year ago. This number was less than the 3.8% increase from the previous week.

Michael Niemira, the ISCS's chief economist and director of research, said that the "higher energy prices are seemingly weighing on demand for nonessential goods by middle and lower-income households" during this time. This decrease in sales also occurs despite the increase in sales for basic foods and supplies in Texas and the South due to Hurricane Katrina's displaced residents.

With this data, an investor can see that the increased sales due to Hurricane Katrina's natural event don't override the decrease due to higher energy prices. Michael Niemira, however, also stated on September 13, 2005, that the ICSC expects overall chain store sales "to increase by approximately 3.0 to 3.5%, on a year-over-year basis."

Significance of ICSC-UBS Store Sales

Consumer spending patterns can influence investment pricing since consumer spending is about two-thirds of the United States' gross domestic product (GDP). So the weekly ICSC-UBS store sales index helps view economic activity during major holidays and events. Growing store sales can mean increased profits for companies, so this index is useful for forecasting stock market direction.

For example, the weather can be a factor in whether sales for winter clothes increase or decrease. Sales will be higher when it is colder out. If there is a snowstorm outside, however, consumers may not leave the house to go shopping. Holidays such as Christmas at the end of the year where consumers buy gifts can also increase sale percentages. Higher gasoline costs or food costs can also contribute to less spending money and reduce retail purchases.

A pandemic like COVID-19 can also affect consumer spending when consumers are going out to the stores less. Not being able to browse products or be tempted by items they didn't intend to buy but see at the store can reduce purchases, especially when most shopping is done online for specific products needed.

History Of ICSC-UBS Store Sales

On March 15, 1957, seven men contributed $500 each to found the ICSC. These men were Clyde Brown, Michael Lewis, Albert Lowery, James Osberg, Robert Peters, Howard Senor, and Harold Spurway. The ICSC consists of about 45,000 members from 75 countries and includes retailers, marketing personnel, shopping center owners, developers, and public officials.

The UBS Securities LLC has more than 150 years of history and, since 1862, comprises over 370 banks that now form the current UBS. One of the financial firms that are part of the UBS is the Union Bank of Switzerland. UBS does not stand for the Union Bank of Switzerland.

ICSC-UBS store sales index is calculated using a weekly seasonal adjustment. This method follows the Piser Method that became standard for weekly adjustment in the 1930s.

ICSC-UBS Store Sales Index vs. ICSC-Goldman Store Sales

These two are essentially referring to the same index provided by ICSC. Goldman refers to the Goldman Sachs Group, an investment banking firm. Before September 30, 2008, the UBS financial services firm prepared the ICSC index. The name change occurred once Goldman Sachs began its involvement with ICSC in 2008.

ICSC-UBS Store Sales Index vs. The Redbook Index

These two indexes are similar in how they calculate their numbers but still have distinct differences. Both ICSC and Redbook use sales-weighted geometric average growth rates and contact retailers to assess weekly sales numbers. Both also only include chain store sales from the leading stores.

The main difference is that the Redbook index only looks at U.S. stores and U.S.-based retailers' same-store sales data. This method creates a certain limitation because many global companies also rely on their stores outside the U.S. The ICSC-UBS Store Sales Index has a larger sample size in comparison.