The Federal Reserve Bank of Atlanta publishes a monthly report titled “Business Inflation Expectations” (BIE) that contains statistics from a survey of regional businesses’ views on various factors that impact profitability. These factors include unit costs, unit cost expectations, sales levels, pricing, profit margins, and other factors.
As described on the site:
“Approximately 300 panelists receive the survey each month. Panelists represent businesses of various sizes headquartered within the Sixth District, which encompasses Alabama, Florida, Georgia, and sections of Louisiana, Mississippi, and Tennessee. Panelists range from executives of large corporations to owner-operators of small businesses. The industry composition of the panel roughly reflects the makeup of the national economy. Nevertheless, survey responses are weighted by industry shares of national gross domestic product.”
An excerpt from the April 2021 BIE Survey dated April 14, 2021 (involving 199 firms responding):
- Inflation expectations: Firms’ year-ahead inflation expectations are relatively unchanged at 2.5 percent, on average.
- Current economic environment: Sales levels and profit margins compared to “normal” improved over the month with sales returning to average levels while profits remain near average levels. Year-over-year unit cost growth increased significantly to 2.4 percent, on average.
- Quarterly question: Firms’ sales gap (percentage below “normal” unit sales levels) decreased significantly to 1.1 percent as firms, on average, are now at “normal” sales levels.
- Special question: If a firm’s unit cost growth was up significantly, they were asked how long they expected this to last. They were then asked to report whether they experienced a price change over the last 12 months and what the percent change was. This question was followed up by asking about their expected price changes over the next 12 months. A breakdown of the results can be found in the special question section below.
The report also includes other questions and a variety of charts and tables depicting respondents’ answers.
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RevSD, LLC offers the above commentary for informational purposes only, and does not necessarily agree with all (or any) of the views expressed by these outside parties.
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ProfitabilityIssues.com is published by RevSD, LLC. RevSD, LLC is a management consulting firm and strategic advisory that focuses on the analysis of current and future business conditions, and given these conditions, offers corporations and businesses advice, strategies, and actionable methods on how to optimally increase revenues and profitability.