OVERALL CARD SALES DECLINE in Q4 2010 FOR MAIN STREET BUSINESSES
Capital Access Network Releases Results from its Q4 2010 Small Business Credit Sales Report New England, Great Lakes Regions and Restaurant Sector Show YoY Gains
New York (January 20, 2011) Capital Access Network, Inc.'s (CAN) Data Services Division today released its Q4 2010 Small Business Credit Sales Report (SBCS Report). The SBCS Report shows that "Main Street" brick and mortar retailers, service providers and restaurants recorded their 13th consecutive quarter of Year-over-Year (YoY) credit and signature debit card sales decline in Q4 2010, with card sales off 2.56% from Q4 2009 levels. However, the drop was the smallest YoY decline since Q3 2008 and represents the fifth consecutive quarter of slowing YoY card sales declines.
"We continue to see card usage at Main Street businesses decline as the banks decrease the levels of their revolving credit float," stated Glenn Goldman, CAN's CEO and President. However, Main Street seems to be capturing a larger proportion of the revolving credit spend, as the decline rate of Main Street card sales is lower than the decline rate of overall revolving credit outstanding. "We see merchants in the New England and Great Lakes regions, as well as the restaurant industry, actually increasing their YoY card sales," said Goldman, "and for restaurants, it's the first increase we've seen since Q2 2008."
The Q4 SBCS Report also includes card sales data based on "risk levels" assessed by CAN's proprietary risk scoring models. "The SBCS Report now includes a new breakout of the data corresponding to 'risk level,'" said Goldman. The risk levels are designated levels "A" through "D", with "A Risk" meaning lowest risk and "D Risk" meaning highest risk. "CAN's Data Services Division works with its Financial Technology Group to provide data enhancements that provide new insight into Main Street businesses, helping communities of merchants, analysts and the media; breaking out card sales by "risk" band is one more example of that mindset."
A copy of the Q4 2010 SBCS Report can be viewed at http://www.capitalaccessnetwork.com/sbcsreport.html.
Key Q4 2010 SBCS Report Highlights:
-
Q4 2010 overall same store credit and signature debit card sales for all measured "Main Street" restaurants, retailers and service providers were down 2.56% from their Q4 2009 levels, representing the thirteenth consecutive quarter of YoY declines and the fifth consecutive quarter of moderating YoY declines. The drop in YoY card sales was the smallest drop seen since Q2 2008 when card sales fell 1.33% compared to Q2 2007.
SPOTLIGHT: December 2010 card sales were essentially flat compared to December 2009 levels, declining only 0.24%. Comparable figures for October 2010 and November 2010 card sales showed YoY declines of 3.93% and 3.62%, respectively. Main Street continues to hold onto its share of the declining revolving credit "float." According to the Federal Reserve's January 7, 2011 G.19 Release (Consumer Credit), revolving credit declined nationwide 8.1% in October 2010 and is projected to have declined 6.3% in November 2010. -
YoY card sales in Main Street restaurants increased 1.80% in Q4 2010, the first positive movement seen in that sector since Q2 2008. Retail establishments continued to see declines in card sales on a YoY basis, recording their 15th consecutive quarter of reduced card spend, however the drop of 5.78% was the lowest decline seen in the past two years.
SPOTLIGHT: All restaurant categories, except "fine dining" saw increases in card spend in Q4 2010 compared to Q4 2009. The least expensive restaurants - those with tickets averaging less than $25 - experienced the greatest increase (4.24%). Restaurants with average ticket sizes between $25 and $50 saw a 0.39% increase in card sales. Those restaurants with average ticket sizes between $50 and $100 saw a 2.36% increase. The most expensive restaurants - with tickets averaging more than $100 - was the only category reporting a YoY decline (1.06%). -
Smaller urban and suburban MSAs* continue to show stronger YoY card sales trends than both rural and larger urban MSAs. Those areas with populations between 100,000 and 249,999 as well as those with populations between 250,000 and 999,999 recorded flat Q4 2010 card sales volumes compared to Q4 2009. Rural MSAs (populations less than 100,000) declined 5.40% and larger urban MSAs (populations of 1 million plus) declined 4.19%.
-
Both the New England and Great Lakes Regions showed card sales increases in Q4 2010 compared to Q4 2009, at 3.15% and 0.89%, respectively. All other regions recorded declines. However, both the Southeast and Southwest regions continued to slow their rates of card sales decline through the end of 2010 after suffering the worst levels of YoY declines in the nation throughout 2009. Both regions halved their average rate of YoY decline in 2010 compared to 2009.
-
All Time in Business categories posted moderating card sales declines, led by Main Street businesses that have been in operation 10 to 15 years, which reported card sales declines of only 1.01% for Q4 2010 compared to Q4 2009. All other Time in Business categories recorded YoY declines ranging between 2.41% and 3.14%.
-
Lowest Risk businesses - those that CAN's proprietary risk scoring models deem "A" level risk - recorded same store card sales increases of 2.15% in Q4 2010 compared to the same period in 2009. Businesses in CAN score designations "B", "C" and "D" posted same store credit sales declines of 1.73%, 4.14% and 13.09% respectively in Q4 2010 as compared to Q4 2009.
*Metropolitan and Micropolitan Statistical Areas as defined by the Office of Management and Budget based on U.S. Census Bureau data.
About the CAN Small Business Credit Sales Report
The Small Business Credit Sales (SBCS) Report is a quarterly report highlighting credit and debit card sales trends within small to mid-sized businesses nationwide. Sponsored by the Data Services Division of Capital Access Network, Inc. (CAN), a New York-based financial technology company, the SBCS Report features analysis of credit and debit card sales trends based on same store card sales data housed in CAN's data warehouses, which retain 12 years of data and include more than 50,000 businesses. Most same store sales retail reports focus on or include data from big-box retail and nationwide/regional department stores, either ignoring or obscuring the trends of the majority of small and mid-sized businesses. The SBCS Report was designed to assist business owners, the processing industry, associations, analysts and media interested in tracking and benchmarking credit and debit card sales trends among small and mid-sized businesses. Data published may include:
- Average Same Store Credit Sales - Overall
- Average Same Store Credit Sales - by Population Size
- Average Same Store Credit Sales - by Industry and Ticket Size
- Average Same Store Credit Sales - by Geographic Region
- Average Same Store Credit Sales - by Time in Business
- Average Same Store Credit Sales - by Risk Category
About Capital Access Network, Inc.
Capital Access Network, Inc. (CAN) leverages leading edge data, systems and technology, combined with a unique and highly effective Daily Remittance Platform™, to deliver innovative financial products and services geared to small and mid-sized businesses (SMBs) and SMB capital providers. The Financial Technologies Group (FinTech Group) offers SMB lenders, credit card issuers and other capital providers customized platforms and hosted services that enable Daily Remittance-powered financial products, improving underwriting decisioning and delivery, extending customer lifecycles, controlling costs and enhancing portfolio performance. The Data Services Division draws upon the data gathered by CAN's subsidiaries through more than a decade of collecting and analyzing the sales trends and firmographics of tens of thousands of SMBs. CAN also provides merchant capital options powered by Daily Remittance Platforms™ through its wholly-owned subsidiaries: AdvanceMe, Inc, the leader in Merchant Cash Advances, and NewLogic Business Loans, Inc. Headquartered in New York, CAN and its subsidiaries currently employ 380 people in four locations in New York, Georgia, Massachusetts and Costa Rica. Learn more at www.CapitalAccessNetwork.com.
MEDIA CONTACT:
Carrie Crabill
Trevelino/Keller Communications Group
404-214-0722 x102
ccrabill@trevelinokeller.com
