Retail Trade Survey (Monthly) (MRTS)

Retail Trade Survey (Monthly) (MRTS)
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Detailed information for October 2006

Status:

Active

Frequency:

Monthly

Record number:

2406

The Monthly Retail Trade Survey collects sales and the number of retail locations by province and territory from a sample of retailers.

Data release - December 21, 2006

Description

The Monthly Retail Trade Survey collects sales and the number of retail locations by province and territory from a sample of retailers. Sales estimates obtained from retailers are a key monthly indicator of consumer purchasing patterns in Canada. Furthermore, retail sales are an important component of the Gross Domestic Product, which measures Canada's production, and are part of many economic models used by public and private agencies. The Bank of Canada relies partly on monthly retail sales estimates when making decisions that influence interest rates. Businesses use retail sales estimates to track their own performance against industry averages and to prepare investment strategies.

Retail sales estimates do not include any form of direct selling that bypasses the retail store, e.g., direct door-to-door selling; sales made through automatic vending machines; sales of newspapers or magazines sold directly by printers or publishers; and sales made by book and record clubs. Internet retailing activities are included in the survey only when conducted through the same legal structure as the retail establishment.

For additional information on Methodology, see Appendices II, III and IV of the "Retail Trade" publication, Statistics Canada catalogue no. 63-005-XWE available through the link "Publications" included in the side bar menu.

Reference period: Month

Collection period: Collection of the data begins approximately 7 working days after the end of the reference month and continues for the duration of that month.

Subjects

  • Retail and wholesale
  • Retail sales by type of store

Data sources and methodology

Target population

The target population consists of all statistical establishments on Statistics Canada's Business Register (BR) that are classified to the retail sector using the North American Industry Classification System (NAICS 2002). The NAICS code range for the retail sector is 441100 to 453999.

The exclusions to the target population are ancillary establishments (producers of services in support of the activity of producing goods and services for the market of more than one establishment within the enterprise, and serves as a cost centre or a discretionary expense centre for which data on all its costs including labour and depreciation can be reported by the business), future establishments, establishments with a missing or a zero gross business income (GBI) value on the BR and establishments in the following non-covered NAICS:
- 4541 (electronic shopping and mail-order houses)
- 4542 (vending machine operators)
- 45431 (fuel dealers)
- 45439 (other direct selling establishments)

Data for retail trade are presented based on the trade group variant of NAICS.

Instrument design

The questionnaires collect monthly data on retail sales and the number of retail locations by province and territory from a sample of retailers. The items on the questionnaire have remained unchanged for several years. For the 2004 redesign, most questionnaires were subject to cosmetic changes only. The questionnaire for Sales and Inventories of Alcoholic Beverages underwent more extensive changes. The modifications were discussed with stakeholders and the respondents were given an opportunity to comment before the new questionnaire was finalized. If further changes are needed to any of the questionnaires, proposed changes would go through a review committee, and a field test with respondents and data users to ensure its relevancy.

Sampling

This is a sample survey with a cross-sectional design.

The MRTS sample consists of 10,000 groups of establishments (clusters) classified to the Retail Trade sector selected from the Statistics Canada Business Register. A cluster of establishments is defined as all establishments belonging to a statistical enterprise that are in the same trade group and geographical region. The MRTS uses a stratified design with simple random sample selection in each stratum. The stratification is done by trade groups using the NAICS-four digit level, and the geographical regions consisting of the provinces and territories, as well as three provincial sub-regions. We further stratify the population by size. The size measure is created using a combination of independent survey data and three administrative variables: the GBI, the GST sales, and the T2 revenue (from corporation tax return).

The size strata consist of one take-all (census), at most two take-some (partially sampled) strata, and one take-none (none sampled) stratum. Take-none strata serve to reduce respondent burden by excluding the smaller businesses from the surveyed population. These businesses should represent at most five percent of total sales. Instead of sending questionnaires to these businesses, the estimates will be produced through the use of administrative data.

The sample was allocated optimally in order to reach target coefficients of variation at the national, provincial/territorial, industrial, and trade group by province/territory levels. The sample was also inflated to compensate for dead, non-responding, and misclassified units.

MRTS is a repeated survey with maximization of monthly sample overlap. The sample is kept month after month and every month births are added to the sample and dead units are identified. MRTS births, i.e., new clusters of establishment(s), are identified every month via the BR's latest universe. They are stratified according to the same criteria as the initial population. A sample of these births is selected according to the sampling fraction of the stratum to which they belong and is added to the monthly sample. Deaths also occur on a monthly basis. A death can be a cluster of establishment(s) that have ceased their activities (out-of-business) or whose major activities are no longer in retail trade (out-of-scope). The status of these businesses is updated on the BR using administrative sources and survey feedback, including feedback from the MRTS. Methods to treat dead units and misclassified units are part of the sample and population update procedures.

Data sources

Responding to this survey is mandatory.

Data are collected directly from survey respondents and extracted from administrative files.

Collection of the data is performed by Statistics Canada's Regional Offices. Respondents are sent a questionnaire or are contacted by telephone to obtain their sales and inventory values, as well as to confirm the opening or closing of business trading locations. Collection of the data begins approximately 7 working days after the end of the reference month and continues for the duration of that month.

New entrants to the survey are introduced to the survey via an introductory letter that informs the respondent that a representative of Statistics Canada will be calling. This call is to introduce the respondent to the survey, confirm the respondent's business activity, establish and begin data collection, as well as to answer any questions that the respondent may have.

Significant effort is spent trying to minimize non-response during collection. Methods used, among others, are interviewer techniques such as probing and persuasion, repeated re-scheduling and call-backs to obtain the information, and procedures dealing with how to handle non-compliant (refusal) respondents.

If data are unavailable at the time of collection, a respondent's best estimates are also accepted, and are subsequently revised once the actual data become available.

To minimize total non-response for all variables, partial responses are accepted. In addition, questionnaires are customized for the collection of certain variables, such as inventory, so that collection is timed for those months when the data are available.

Finally, to build trust and rapport between the interviewers and respondents, cases are generally assigned to the same interviewer each month. This action establishes a personal relationship between interviewer and respondent, and builds respondent trust.

Use of Administrative Data

Managing response burden is an ongoing challenge for Statistics Canada. In an attempt to alleviate response burden and survey costs, especially for smaller businesses, Statistics Canada has been investigating various alternatives to survey taking. Administrative data files are a rich source of information for business data and Statistics Canada is working at bringing this rich data source to its full potential. As such, beginning with the October 2005 reference month, the MRTS has reduced the number of simple establishments in the sample that are surveyed directly and instead derives sales data for these establishments from Goods and Service Tax (GST) files using a statistical model. The model accounts for differences between sales and revenue (reported for GST purposes) as well as for the time lag between the survey reference period and the reference period of the GST file.

For more information on the methodology used for modeling sales from administrative data sources, refer to 'Monthly Retail Survey: Use of Administrative Data' under 'Documentation' of the IMDB.

View the Questionnaire(s) and reporting guide(s).

Error detection

Data editing is the application of checks to detect missing, invalid or inconsistent entries or to point to data records that are potentially in error. In the survey process for the MRTS, data editing is done at two different time periods.

First of all, editing is done during data collection. Edits during data collection are referred to as field edits and generally consist of validity and some simple consistency edits. Follow-up with respondents occurs to validate potential erroneous data following any failed preliminary edit check of the data. Once validated, the collected data is regularly transmitted to the head office in Ottawa.

Secondly, editing known as statistical editing is also done after data collection. Large outliers that could disrupt a monthly trend cannot be used at the imputation stage.

For more information, see section 8 (Editing) of the Data Quality Statement under 'Documentation' below.

Imputation

Imputation in the MRTS is the process used to assign replacement values for missing data. This is done by assigning values when they are missing on the record being edited to ensure that estimates are of high quality and that a plausible, internal consistency is created. Due to concerns of response burden, cost and timeliness, it is generally impossible to do all follow-ups with the respondents in order to resolve missing responses. Since it is desirable to produce a complete and consistent microdata file, imputation is used to handle the remaining missing cases.

In the MRTS, imputation is based on historical data or administrative data (GST sales). The appropriate method is selected according to a strategy that is based on whether historical data is available, auxiliary data is available and/or which reference month is being processed.

There are three types of historical imputation methods. The first type is a general trend that uses one historical data source (previous month, data from next month or data from same month previous year). The second type is a regression model where data from previous month and same month, previous year are used simultaneously. The third type uses the historical data as a direct replacement value for a non-respondent. Depending upon the particular reference month, there is an order of preference that exists so that a top quality imputation can result. The historical imputation method that was labelled as the third type above is always the last option in the order for each reference month.

The imputation methods using administrative data are automatically selected when historical information is unavailable for a non-respondent. The administrative data source (annual GST sales) is the basis of these methods. The annual GST sales are used for two types of methods. One is a general trend that will be used for simple structure, e.g. enterprises with only one establishment, and a second type is called median-average that is used for units with a more complex structure.

Estimation

Estimation is a process that approximates unknown population parameters using only the part of the population that is included in a sample. Inferences about these unknown parameters are then made, using the sample data and associated survey design.

In the MRTS, new estimation processes have been developed using Statistics Canada's Generalized Estimation System (GES), addressing the need to deal with influential units and allowing for implementation of special corrections during processing. Different methodologies have been put in place to estimate retail sales and inventories.

For retail sales, the population is divided into a survey portion (take-all and take-some strata) and a non-survey portion (take-none stratum). From the sample that is drawn from the survey portion, an estimate for the population is determined through the use of a Horvitz-Thompson estimator where responses for sales are weighted by using the inverses of the inclusion probabilities of the sampled units. Such weights (called sampling weights) can be interpreted as the number of times that each sampled unit should be replicated to represent the entire population. The calculated weighted sales values are summed by domain, to produce the total sales estimates by each industrial trade group / geographic area combination. A domain is defined as the most recent classification values available from the BR for the unit and the survey reference period. These domains may differ from the original sampling strata because units may have changed size, industry or location. Changes in classification are reflected immediately in the estimates and do not accumulate over time. For the non-survey portion, a ratio type estimator is calculated using auxiliary data. The estimate of the total retail sales is equal to the sum of the survey and non-survey portion estimates.

For retail inventories, a non-probability sample is drawn including the largest businesses in each domain, and a ratio type estimator is used to produce an estimate for the population total.

The measure of precision used for the MRTS to evaluate the quality of a population parameter estimate and to obtain valid inferences is the variance. The variance from the survey portion is derived directly from a stratified simple random sample without replacement.

Sample estimates may differ from the expected value of the estimates. However, since the estimate is based on a probability sample, the variability of the sample estimate with respect to its expected value can be measured. The variance of an estimate is a measure of the precision of the sample estimate and is defined as the average, over all possible samples, of the squared difference of the estimate from its expected value.

Quality evaluation

Prior to publication, combined survey results are analyzed for comparability; in general, this includes a detailed review of individual responses (especially for large businesses), general economic conditions and historical trends.

Disclosure control

Statistics Canada is prohibited by law from releasing any information it collects which could identify any person, business, or organization, unless consent has been given by the respondent or as permitted by the Statistics Act. Various confidentiality rules are applied to all data that are released or published to prevent the publication or disclosure of any information deemed confidential. If necessary, data are suppressed to prevent direct or residual disclosure of identifiable data.

Confidentiality analysis includes the detection of possible direct disclosure, which occurs when the value in a tabulation cell is composed of a few respondents or when the cell is dominated by a few companies.

Revisions and seasonal adjustment

Revisions in the raw data are required to correct known non-sampling errors. These normally include replacing imputed data with reported data, corrections to previously reported data, and estimates for new births that were not known at the time of the original estimates.

Raw data are revised, on a monthly basis, for the month immediately prior to the current reference month being published. That is, when data for December are being published for the first time, there will also be revisions, if necessary, to the raw data for November. In addition, revisions are made once a year, with the initial release of the February data, for all months in the previous year. The purpose is to correct any significant problems that have been found that apply for an extended period. The actual period of revision depends on the nature of the problem identified, but rarely exceeds three years.

Retail trade data are seasonally adjusted using the X11ARIMA/20001 model. This consists of extrapolating a year's worth of raw data with the ARIMA model (auto-regressive integrated moving average model), and of seasonally adjusting the raw time series. At the end of every calendar year, seasonally adjusted monthly figures are revised to equal the sum of the unadjusted estimates.

For more information about the revisions and seasonal adjustments method, see Sections, 11, 12 and 15 (Seasonal Adjustments and Trend-Cycle Estimation; Adjustment for Historical Series; Data Comparability) of the Data Quality Statement under 'Documentation' below.

Data accuracy

The methodology of this survey has been designed to control errors and to reduce their potential effects on estimates. However, the survey results remain subject to errors, of which sampling error is only one component of the total survey error. Sampling error results when observations are made only on a sample and not on the entire population.

All other errors arising from the various phases of a survey are referred to as non-sampling errors. For example, these types of errors can occur when a respondent provides incorrect information or does not answer certain questions; when a unit in the target population is omitted or covered more than once; when a unit that is out of scope for the survey is included by mistake or when errors occur in data processing, such as coding or capture errors. While the impact of non-sampling errors is difficult to evaluate, certain measures such as response and imputation rates can be used as indicators of the potential level of non-sampling error.

Coefficients of variation (CV) and response rates are major data quality measures used to validate results from the MRTS.

The coefficient of variation, defined as the standard error divided by the sample estimate, is a measure of precision in relative terms. Since the coefficient of variation is calculated from responses of individual units, it also measures some non-sampling errors.

For more information, see Sections 6.1 and 13 (Response and Non-Response; Data Quality Evaluation) of the Data Quality Statement under 'Documentation' below.

For a detailed list of coefficients of variation for all trade groups at the Canada level and for all the provinces and territories, please consult table 4 of the Monthly Retail Trade Survey electronic publication, Statistics Canada catalogue: 63-005XWE, available through the link "Publications" included in the side bar menu above.

Documentation

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