2011 has turned out to be a very successful calendar year. So successful it really began on Dec. 9, 2010.

On that date, Gov. Pat Quinn asked IRMA “what could be done about leveling the playing field that retailers face from their internet counterparts not collecting the Illinois sales tax.”  That conversation set in motion IRMA discussions with Senate President John Cullerton and Senate Republican Leader Christine Radogno on the subject.

When IRMA raised the New York law to create nexus for internet sellers their immediate reaction was “let’s go.”  In a subsequent meeting with House Republican Leader Tom Cross and Speaker Michael Madigan’s designee, House Revenue Chairman John Bradley, both said they would be supportive if the measure was reported out of the Senate.

When the Legislature returned to Springfield on Jan. 4 Senator Cullerton and his co-sponsor Senator Radogno filed an amendment to HB 3659. It was heard in committee and on Jan. 5 passed on a 49-6 roll call. The next day, the House concurred and the E-Fairness Act was passed on an 88-29 roll call.

Gov. Quinn signed the Bill into law on March 10.  The speed in which the House and Senate enacted this legislation was indicative of the support and urgency with which this country needs to deal with sales tax collections. None of this would have happened without a conversation with Gov. Quinn or the support of all those named above.

On Feb. 23, the Organized Retail Crime Bill sponsored by Senator Iris Martinez and Representative Connie Howard was signed into law by Gov. Quinn.  This far-reaching legislation, which expands our current forfeiture law to include organizers of retail crime, has become the model for the nation.

April brought about the appropriate time for IRMA members participating in the Exelon Energy Program to renew and extend purchase contracts for electricity because of favorable market conditions. For the first time in recent memory, members were able to secure long-term contracts on electricity, in many instances at or just below 4 cents per KWH. Because of low demand for electricity and natural gas, the timing was good to secure historic low prices for energy.

Worker’s Compensation negotiations and passage through both the House and Senate happened in May. House Bill 1698 sponsored by Representative John Bradley and Senator Kwame Raoul passed both Houses in the final days of May. It took a lot of work, but good things usually do.

The measure called for a 30 percent reduction in the medical fee schedule and other significant reforms. The leadership of Gov. Quinn, President Cullerton, Republican Leader Radogno and Speaker Madigan along with the Sponsors created an environment where the first major reform in worker’s compensation in more than 30 years was accomplished.

It did not happen without controversy. There were those in the Assembly and within the business community who thought the changes were not substantial enough to justify adoption.  Obviously good judgment prevailed over good politics. There is still a lot more to be done, but this is a good start.

In June Gov. Quinn invited IRMA and the Illinois Manufacturers’ Association to join him in a fly-around to sign the Worker’s Compensation Reform Bill.

Also in June, through the fine leadership of retailing’s national trade associations and the “grass roots” support of State Retail Associations, the industry defeated an Amendment which would have modified and delayed the Swipe Fee Amendment which was passed by our own Illinois Senator, Dick Durbin. Not a bad month for the industry.

Illinois Gov. Pat Quinn announces a new Organized Retail Crime law on Feb. 23 in Chicago. The new law was designed to separate it from other felony retail theft and serve as a deterrent to sophisticated crime rings.

In July DHS filed a Rule to reduce pharmacy reimbursement by $42 million. IRMA objected formally and through great “grassroots” contacts delayed the Rule at the Joint Committee on Administration Rules. In July and August the pressure was kept on the Department and they agreed to a Sept. 12 formal hearing.

At the hearing, IRMA and the other pharmacy groups presented compelling reasons why pharmacy should not be cut. Subsequent to the meeting, discussion and negotiations were held with the Department causing an Amended Rule to be filed on Dec. 15, which will not harm pharmacy while achieving long term goals for the Department.

July trips to Washington with IRMA members and staff allowed for serious discussions on the “Main Street Fairness Act” to authorize the collection of sales taxes throughout the country. For the first time since the “Quill” Supreme Court case in 1992, Bills were introduced, hearings were scheduled and enormous visibility was brought to “level the playing field” for retailers across America.

At IRMA it is believed that much of the publicity, movement and new consideration in many states of “Bills to require the collections of sales taxes” was precipitated by the activities in the first week in January in the Legislature in Illinois.

Special thanks go to Senator Cullerton for his many years of support for E-Fairness and the number of contacts he made with Senator Durbin requesting federal action and to Senator Durbin for introducing the Main Street Fairness Act on the federal level this year. Additional meetings with local chambers of commerce and editorial boards, members of Congress and the United States Senate continued in September in support of Main Street Fairness.

Illinois Gov. Pat Quinn shows the newly signed Unemployment Insurance agreement on Nov. 29. He is surrounded by representatives of the business community, including (second from left) IRMA Senior Vice-President Rob Karr and (next to the Gov.) IRMA President & CEO David F. Vite.

Potash Markets, Chicago, was honored in September at the very successful IRMA Annual Luncheon as Illinois Retailer of The Year. The Potash family was appropriately recognized for their contributions to the community, their industry and their employees. The annual event was made even more special as Senator Durbin saluted Potash Markets in a special video presentation, and Chicago Mayor Rahm Emanuel gave his first speech to the Illinois retailers.

Outgoing IRMA Board Chairman Richard Cohen of Macy's, left, and incoming Board Chairman C.J. Schnakenberg of Chicago Brass, right, meet Chicago Mayor Rahm Emanuel at IRMA's 54th Annual Luncheon in September.

October was a time of intense negotiations on what turned out to be the successful November adoption of the Unemployment Insurance Reform Act of 2011, SB 72.  Participating in the “agreed bill process” called by Gov. Quinn and supported by the legislative leaders, business and labor worked diligently to fashion a solution that was reasoned for unemployment workers and cost saving for Illinois business.

While the IRMA-led negotiations were difficult, often acrimonious, they produced a product which will save Illinois employers over $400 million over the next eight years. The UI Reform Act passed the General Assembly and was signed into law on Nov. 18 by the Governor.

In addition, during October and November, IRMA provided much-needed business community support to Toni Preckwinkle, President of the Cook County Board of Commissioners, for the continued rollback of the sales tax. IRMA testified in support of the measure and was featured in Chicago’s leading business publication as well as the Sun-Times for its support of the rollback. Residents of Cook County will see the sales tax rolled back by .25 percent at the start of 2012.

November also brought discussions about tax reform not only in Cook County but in the state legislature as well. The discussions led to a December passage of a Bill to increase the Estate Tax Exemption to $4 million over the next two years, provide for a Net Operating Loss deduction of up to $100,000 and retain two of Illinois most venerable companies and their attendant jobs in Illinois. We are proud to call Illinois the home of Sears Holdings Corporation.

You will note that everything discussed has been positive. The only real downside to this legislative year was the passage of a temporary Income Tax increase. There is much work to be done in Illinois to regain prominence once again in job creation, business climate and image.  Steps taken in 2011 have been good, but be assured that IRMA will continue to work with the elected leaders of this state to create an environment in which retailers and other businesses can create jobs, increase economic opportunity and improve the reputation of “the Land of Lincoln.”

IRMA is grateful to IRMA’s Chairman C. J. Schnakenberg, its most recent Chairman Richard Cohen, and all members of the Board for guiding the staff through the policies and decisions necessary to have a successful 2011. No doubt under the continued leadership of Chairman Schnakenberg, IRMA will continue to be successful.

This is a great time of year to reflect on all of the successes and positive things which have occurred in the previous year. That time of retrospective review will create new beginnings for 2012.

HAPPY NEW YEAR!!

Retailers lead the charitable way

Retail companies took the first three spots on a list of the five most generous corporations in the United States, according to The Chronicle of Philanthropy, a magazine that monitors the charitable giving industry.

The magazine’s 2011 Survey of Corporate Giving looked at data on 2010 donations for 180 of the Fortune 500 companies. The top five – which included Kroger Corporation, Macy’s and Safeway, parent of Dominick’s Food Stores, each gave more than 5 percent of their  2009 profits to charity during 2010.

Topping the list was Kroger, the Cincinnati supermarket chain, which gave 10.9 percent of its previous year’s profit to charity last year. The company, which gave $64 million to charity, is active in the Food 4 Less program to feed the hungry, has raised $1.5 million for military familes and welcomed Salvation Army donation kettles into its stores.

Macy’s was second on the list, giving 8.1 percent of its 2009 profits during 2010, a total of more than $41 million. The company funded more than 1,200 grants to organizations in the communities where it operates.

Third on the list was Safeway, which donated 7.5 percent of its profits for a total of $76.5 million. Safeway gave to causes such as Easter Seals, Special Olympics, Muscular Dystrophy Association and prostate and breast cancer initiatives, according to the report.

The largest overall corporate donor in 2010 was Wal-Mart, which claimed that distinction for the third straight year. The company donated more than $319 million local and national initiatives to combat hunger and promote local economic development in its communities, the report stated.

Illinois reaches agreement on Unemployment Insurance
Momentum grows for national online sales tax legislation
Online shopping growth raises concerns
Five ideas for responding to consumer price transparency
Strong start for holiday shopping
Jobs and jobless rate up in state

Illinois reaches agreement on Unemployment Insurance

Governor Pat Quinn announced an agreement to reduce Unemployment Insurance taxes, prime the economic pump in Illinois, and bring more accountability to the unemployment insurance program.

This agreement was reached after long and sincere negotiations. I believe it is a good deal for Illinois’ businesses and the workers we employ.

Illinois Gov. Pat Quinn shows the newly signed Unemployment Insurance agreement on Nov. 29. He is surrounded by representatives of the business community, including (second from left) IRMA Senior Vice-President Rob Karr and (seventh from left) IRMA President & CEO David F. Vite.

This was accomplished through the “agreed Bill” process which brought business and labor together to “hammer” out a solution. IRMA served as the lead negotiator in the intense four-month process.

As discussed in previous communications, the U/I Trust Fund is more than $2.3 Billion in debt to the Federal government. As a result, Illinois business, without this legislative change, will pay more than $1.2 Billion in penalties and the State of Illinois will be responsible for nearly $250 million in interest payment to the Feds. This agreement will allow the State to reduce the interest penalties by nearly two-thirds and employer penalties to be reduced by one-third.

The agreement saves more than $400 million in unemployment insurance taxes for Illinois businesses. It also provides a significant reduction in taxes of all employers with no history of layoffs, which is nearly half of all businesses in our state. And while it will return the Trust Fund to solvency by 2018, it also calls for meetings before that date if the economy improves more quickly than anticipated, which could provide an avenue for additional tax savings.

Without this agreement, taxes will increase significantly for everyone across the board, and there would be no new mechanisms to fight employee fraud and recover fraudulent payments from workers, such as garnishing their federal tax return.

This is a good deal for Illinois businesses and shows what can be done in Springfield when the business community’s voice is heard throughout the process.

My appreciation goes to the Governor and Legislative leaders for their leadership on this issue and to the business and labor representatives in the Agreed Bill process for their hard work and constant belief that a solution was required.
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Momentum grows for national online sales tax legislation

As U.S. Senator Dick Durbin (D-Illinois) pushes forward to level the playing field between brick and mortar and remote retailers, the issue is gaining momentum in Illinois.

The Marketplace Fairness Act, introduced by Durbin and four other U.S. Senators, is getting plenty of attention in Illinois newspapers and radio. The Act intends to require online merchants to collect sales taxes the same as stores with a physical location.

“This legislation is another sign of momentum in support for leveling the playing field between online and brick-and-mortar retailers,” IRMA President & CEO David F. Vite said in an interview with Crains Chicago Business on Nov. 9.

The Chicago Tribune addressed the issue in a Nov. 18 editorial, calling Durbin’s bill “a welcome breakthrough.”

“No one likes paying taxes,” Tribune editors wrote. “But everyone should be assessed fairly. As a practical matter, the money needs to be collected by online merchants at the time of the transaction – the same way brick-and-mortar stores have done for generations.”

Vite spoke to the Naperville Chamber of Commerce about the issue on Nov. 14, and both local newspapers and radio media reported on it. He told chamber members that the collection of sales taxes online would not be a tax increase, but the closure of a loophole of which remote sellers are taking advantage.

“I think we have a real chance to level the playing field for those retailers who are supportive of our local chamber of commerce,” Vite said. He estimated that Illinois alone would gain $400 million currently and up to $1 billion by 2020 if online taxes were collected.

IRMA Senior Counsel Tanya Triche, speaking at Sen. Durbin’s press conference in Washington, D.C., reminded the media the importance of store fronts to the economic viability of many communities.

“If we continue to have a 10 percent deficit against our online competitors, it’s going to be very hard to stay in business. You don’t want those storefronts to go vacant and you don’t want those jobs to be lost,” she said.

“The retail industry in the State of Illinois employs one of five workers. This marketplace fairness act really creates parity for all of us.”

WJBC radio in central Illinois spoke at length with IRMA Senior Vice-President Rob Karr in September. Karr suggested that by not collecting sales and use taxes, online retailers are subjecting their customers unknowingly to a tax liability.

“A lot of Illinois consumers were not aware that they were owing sales tax if the retailer doesn’t collect it,” Karr explained. “It’s ridiculous that these online businesses are exploiting a loophole.”

He explained the Supreme Court’s 1992 decision that opened the door for the loophole by mandating sales tax collection only by those businesses with a physical presence. E-commerce started after that decision, Karr said, so the meaning has changed and changes in the law need to follow.

“The best way is to get something done nationally, which is what Senator Durbin is trying to do,” he said.
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Online shopping growth raises concerns

The need for the Marketplace Fairness Act in Washington, D.C. became more apparent than ever during Black Friday as online shopping increased 26 percent over the same day in 2010, according to comScore, a digital business analytics company.

Total online sales reached $816 million, comScore reported. Through the first 25 days of the November/December shopping season, comScore said online spending is up 15 percent over last year with a total of $12.7 billion in sales.

Online traffic increased 35 percent from a year ago on Black Friday as 50 million Americans visited online retail sites. While many of the top retail websites of the day were companies which also have storefronts and collect sales taxes, Amazon.com led all sellers with 50 percent more visitors than any other retailer.

Shoppers spent an average of $150.53 online during the Thanksgiving weekend, according to the National Retail Federation, making internet purchases count for 37.8 percent of their total weekend spending.

The online shopping frenzy continued on Cyber Monday – the first Monday after Thanksgiving – as online retailers promoted deep discounts, free shipping and other deals. An estimated 122.9 million Americans were expected to shop on Cyber Monday, up from 106.9 million from 2009, according to a survey conducted for Shop.org by BIGresearch.

While the reports showed the importance of the online channel to the retail industry, they also pointed out the growing inequity between online and brick and mortar companies.

“It’s important to remember that as brick and mortar retailers continue to lose more sales to online retailers who are taking advantage of the online loophole, state and local governments will continue to lose more and more sales tax revenue,” IRMA President & CEO David F. Vite said.

According to the National Retail Federation, cash-strapped states are currently losing about $24 billion a year to untaxed online purchases. Recouping that revenue would help support essential local services such as teachers, police officers, firefighters and ambulance crews, he said.

An NRF official said the price advantage enjoyed by online sellers is stifling Main Street stores’ ability to compete. David French, NRF Senior Vice President for Government Affairs, made his comments in an address to the U.S. House Judiciary Committee on Nov. 30.

“As retailing evolves and Internet sales become a more prominent portion of total retail sales, it is critical that Congress address the sales tax collection discrimination that exists between brick and mortar and remote sellers,” French said.

“NRF urges the committee to enact sales tax collection reform that will level the playing field between brick and mortar and remote sellers by granting states the authority to collect sales taxes from all sellers regardless of their distribution method.”
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Five ideas for responding to consumer price transparency

Retailers will have a difficult time making a sale if every customer is able to slide out their smart phone, photograph a product and find the cheapest price – somewhere else. Price transparency is one of the biggest challenges for retailers with the growth of personal technology.

But a new report from Retail Systems Research shows how retailers can respond to the challenge.

The report states that while in today’s digital world, there are fewer barriers protecting localized pricing – consumers can always find the lowest. But it also states that there is almost always something consumers value alongside price. The challenge for retailers is to find the right thing and communicate it to the right consumers effectively.

1. Target your promotions directly to your customers, using technology to personalize it. Sell it as “your price” instead of “the price.”
2. As promotions become more targeted, retailers need more players involved in making pricing decisions. Everyone, from those working in procurement, to marketing, to the supply chain, must get involved in making pricing decisions.
3. Retailers need a data plan to measure the impact of their pricing decisions. There are too many decisions made as millions of unique combinations of offers across their customer base and channels. With a data plan, retailers cannot measure and improve the pricing decisions they make.
4. Retailers need policies and procedures in place for employees to deal with customers who want to price-match with their smart phone. Employees don’t necessarily have to price match the lowest online price to win over the shopper. There may be other significant values important to the customers, from receiving the merchandise immediately rather than waiting several days for delivery or having the item properly serviced.
5. Retailers need to re-evaluate how they communicate offers to their customers across all communication channels. Whether they use Twitter, Facebook or YouTube, retailers must be able to target their customers using social media.

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Strong start for holiday shopping

Holiday shopping got off to a roaring start on Black Friday weekend as a record 226 million people visited stores and retail websites, up from 212 million last year, according to the National Retail Federation.

Shoppers spent an average of $398.62 this year, compared to $365.34 last year. Total spending reached $52.4 billion, the NRF estimated.

The NRF survey, conducted by BIGresearch, found 28.7 million people shopped online and at stores on Thanksgiving Day – up from 22.2 million last year. More people than ever before also shopped online and in stores on Black Friday, as 86.3 million shoppers braved the crowds that day alone.

Shoppers reacted positively to early openings at many stores on Black Friday. Nearly 24.4 percent of customers arrived at stores on Thanksgiving night, compared to 9.5 percent in 2010 and 3.3 percent in 2009.
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Jobs and jobless rate up in state

Mixed signals on the jobless front came in October as Illinois added 30,000 jobs, while an increase in individuals re-entering the work force pushed the state’s unemployment rate to 10.1 percent, according to the Illinois Department of Employment Security.

Meanwhile, the national unemployment rate fell by 0.4 percentage point to 8.6 percent in November, according to the U.S. Bureau of Labor Statistics.

Illinois led the nation in job growth during October. Since January 2010, the state added 108,100 new jobs – the most in the Midwest.

Locally, the unemployment rate dropped in five metro areas across the state, and increased in four others. The largest jobless rate declines were in Rockford (down 1.3 points to 12.6 percent), Peoria (down 0.6 point down to 8.3 percent) and Kankakee-Bradley (down 0.5 point to 11.3 percent). The Chicago-Joliet-Naperville metro rate increased 0.9 point to 9.7 percent.
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Timing is right for ComEd lighting, energy incentives
Merchandising tricks can boost sales
We Card urges Refresher Training
Jobless rate up slightly in Illinois

Timing is right for ComEd lighting, energy incentives

Money-saving possibilities for your retail space may literally be hovering over your head, or as handy as the nearest light switch.

ComEd’s Smart Ideas for Business program provides financial incentives for businesses upgrading to energy efficiency equipment. The program may be able to save you money with a simple investment in new lighting or other energy-efficiency improvements. But if you wait too long, you may be left in the dark.

Lighting needs are the most prominent in retail businesses participating in the program, explained Bill Beattie, Outreach Manager for ComEd. In office buildings, lighting makes up 62 percent of the Smart Ideas projects. But in retail services, it makes up 92 percent, and in warehouse space, it makes up 100 percent.

The incentives start as small as $2 for replacement an incandescent light bulb with an energy-efficient CFL bulb.

But the bigger the project, the bigger the savings. Beattie’s advice to retailers is to consider replacing the old-style T12 lighting fixtures with T8 lighting. Since 2005, the U.S. Department of Energy has put in motion new energy efficiency standards called for fluorescent lighting. Eventually all the T12s will be eliminated. Just last year, ballast manufacturers were prohibited from making replacement magnetic ballasts that do not meet current standards.

Smart Ideas lighting retrofit measures are available until March 31, 2012.

“There’s never been a better time to upgrade lighting and enjoy savings. This is the high-water mark for these incentives,” Beattie explained. “Anyone using T12s and wanting to upgrade should consider this. Those T12s will be eliminated. The time is right in regards to technology and in regards to available incentives.”

Currently, 55 percent of retail stores are using the T12 lighting, according to ComEd. In food stores, 60 percent have the T12s.

The average incentive for retail/service businesses installing new lights in the Smart Ideas program is $2,917. Those companies can expect to annual savings of more than $4,000 per project. In warehouses and distribution centers, where the most popular project is replacing high-bay lighting with new T8 or T5 fluorescent light fixtures and installing occupancy sensors, the average incentive is $16,983. The average annual savings is more than $25,000

The program offers some incentives for upgrading to LED technology. LEDs can be a cost-effective alternative to fluorescent lamps in refrigerators and freezers. The upgrades may offer important savings to grocery stores which typically spend about $4 per square foot on energy costs.

But the program is not all about lighting.

Installing electrically commutated motors in walk-in coolers or freezers typically cost $466 per motor. The ComEd program offers an incentive of $70 and estimates a savings of $109 per year. A business would see its investment paid back in 3.6 years.

Another popular measure is heating, ventilation and air conditioning which can account for as much as 30 percent of a building’s annual energy use. But after Dec. 31, 2011, ComEd will no longer offer incentives for rooftop unitary and split air conditioning systems and air source heat pumps (RTUs).

“Smart Ideas has several tracts, including new contrition, technical assistance and a small business program,” Beattie said. “Be sure to consider your specific project needs first. We’ll help direct you to the right tract.

Opportunity assessment identifies energy efficiency projects at your facility that may qualify for smart ideas incentives. A ComEd Energy engineer will spend about two hours with you on-site to assess opportunities. Within two weeks, you will receive a letter with energy efficiency opportunities with the estimated savings and potential incentives. Simply ask for an opportunity assessment, your ComEd account manager will do the rest.

“We definitely have money available and are trying to get that out the door,” Beattie said. “Call us and we’ll get you to the right place. That’s the whole goal of this – to help you get those savings in to your company.”

For information on the Smart Ideas for Business program, visit www.comed.com/bizincentives. Businesses can also contact comedsmartideas@kema.com or call 888/806-2273 for information.
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Merchandising tricks can boost sales

It doesn’t take a magician to boost sales at your store, but sometimes a few tricks and a good imagination will help.

During his speech at the Illinois Food Retailers Association’s Annual meeting in October, retail consultant and speaker Harold Lloyd offered retailers some simple ways to improve merchandising at their stores. While his audience was mostly grocers, his six key recommendations could be implemented in a number of retail categories.

In his program, “Merchandising Magic,” Lloyd suggested simple, innovative solutions.

His ideas were as simple as keeping customers in the store more. Lloyd pointed out that every additional minute a customer spends exploring the store means an additional $2 in spending. With that in mind, managers need to study where customers are walking in the store and give them compelling reasons to move further into the middle and back of the store.

Improvements in lighting, signage and merchandising displays can dictate customer movement. Lloyd suggested placing $1 bins, visual stimuli such as aquariums, and other popular customer attractions toward the back of the store. He reminded retailers that 10 percent of their customers change annually, so directional maps may also help move people around the store.

Lloyd said retailers should offer buying decisions that are both compelling and easy. He told retailers to use their “Ps and Qs” – make their displays “promotional and quick.”

Three sizes of similar items can be priced simply at $5, $7, and $10, Lloyd said. Bundle deals automatically like fast food restaurants so ‘add-ons’ are already included. Lloyd said the pricing is more about psychology than cost. In one case, he said a retailer was having trouble selling its hot dogs at $1.88 per package. But when he marked them two for $4, sales tripled even though the price went up 12 cents per pack.

Customer contact is also vital to sales. Lloyd cited a study that showed when one employee engages with a customer that customer is likely to spend 17 percent more. Each employee should spend 15 minutes per four-hour shift engaging with customers, and each store manager should spend 30 minutes at noon and 5 p.m. greeting all those entering and leaving the store.

Signs should also help engage the customer. He suggested hanging coupons next to a product, or placing stickers on products that answer a question, solve a problem or tell a story.

Shopping carts are important too. Lloyd explained that when a retailer increases the shopper’s physical capacity to buy, they will purchase more. That means customers with a shopping cart will typically buy more goods than those with a hand basket or those without either.

“Don’t put hand baskets in the front of the store. I never want to entice a customer to use a carry basket first,” Lloyd said. “Don’t tempt a customer with a carry basket before you tempt them twice with a cart,” he said.

He offered simple suggestions: give the shopper a basket if their hands are full; keep additional shopping carts at the rear of the store; keep carry baskets next to the salad bars, service counter and greeting card aisles; put displays of discounted large-size products at the front of the store so more people will need to shop with a cart.

Lloyd urged managers to be more recession-sensitive. When end-caps offered products that were too expensive, it is not showing sensitivity for families living on tight budgets. In a recession, the number of items per customer often goes down. So the items-per-customer metric is one retailers should be willing to build into their planning strategies.

“We must become more passionate about the number of items sold per customer. It’s a powerful metric store management has the power to positively impact,” he said.
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We Card urges refresher training

The We Card Program, part of the Coalition for Responsible Retailing, is urging retailers to provide Refresher Training for employees to complement its Tobacco Retailer Training course.

We Card suggests the Refresher Training because it increases employee retention and reduces mistakes that can cause a store to lose its license to sell tobacco and it reinforces compliance performance so employees are more likely to follow state and federal youth access laws. The U.S. Food and Drug Administration recommends all employees to have a refresher training program at least annually.

The training, which takes about 20-30 minutes, contains short, interactive exercises, and is especially helpful for remedial training, when employees fail to meet responsible retailing expectations.

For more information, visit www.wecard.org, or call 800/934-3968. The We Card website also includes a summary of state laws and sign requirements and gives details on training resources and We Card store materials for 2012.
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Jobless rate up slightly in Illinois

The seasonally adjusted unemployment rate in Illinois ticked up to 10 percent despite the addition of 1,600 new jobs in September, according to the Illinois Department of Employment Security.

The unemployment rate identifies those out of work and seeking employment. Despite the addition of jobs, the rate grew from 9.9 percent to 10 percent in September because of the increase in job seekers.

“Job growth at this stage in the economic cycle often is accompanied by a slight increase in the unemployment rate,” said IDES Director Jay Rowell. “But a broader confidence must be restored at the national level before individual states will show greater wide-spread growth.”

Nationally, the unemployment rate dropped slightly in October, decreasing from 9.1 to 9 percent for the month. The national rate has changed little since April, according to the U.S. Department of Labor.
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Mayor Addresses Retailers
IRMA honors Chicago family grocer
Durbin praises Potash as ‘key voice’
Chairman’s remarks
IRMA Board changes

Mayor Address Retailers

In his first address to Illinois retailers, Chicago Mayor Rahm Emanuel said safe streets, strong schools and stable alliances are the keys to improving the city’s business climate and giving companies an opportunity to thrive in Chicago.

Chicago Mayor Rahm Emanuel addresses attendees of IRMA's 54th Annual Luncheon

Emanuel, in office for only five months, spoke to more than 280 retailers, aldermen and state legislators at IRMA’s 54^th Annual Luncheon on Sept. 14 at the Palmer House Hilton Hotel in Chicago.

“It’s all about jobs,” he said. “Everything I do is about creating an environment where you can start a business, get a job, and raise a family. The decisions we’re making are so we are competitive economically and our businesses are competitive economically.”

The mayor talked about his efforts to improve Chicago schools and make the streets safer so people would feel safe in shopping at local stores. He said retail is not just about downtown stores, but about local stores in Chicago neighborhoods and added that his vision is to improve the quality of life in all neighborhoods throughout the city.

Emanuel mentioned some early successes, such as violent crime dropping 20 percent over a six-week period and then named several companies which either added jobs or relocated to Chicago. Everything from the city’s rules to infrastructure must contribute to make Chicago a business-friendly city, he said.

“It’s all about being in a position so business can thrive. I do not want bureaucracy to be a speed bump to the way of opening up new businesses,” he said.

Illinois Attorney General Lisa Madigan also addressed retailers at the luncheon, thanking IRMA and its member retailers for working with her in curbing the use of methamphetamine, making consumers aware of product recalls, and battling Organized Retail Crime.

“We’re very, very pleased to be able to partner with you. So I want to thank you because it’s always better when we can work together,” she said.
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IRMA honors Chicago family grocer

Calling his 2011 Illinois Retailer of the Year Award a “coveted and appreciated honor,” Potash Markets CEO Art Potash praised his employees and industry groups for helping his family business succeed.

“We’ve been fortunate to be surrounded by great and dedicated people,” Potash said during IRMA’s 54^th Annual Luncheon on Sept. 14.

Chicago Mayor Rahm Emanuel congratulates members of the Potash family at IRMA's 54th Annual Lunch where Potash Markets, Chicago, was honored as IRMA's 2011 Illinois Retailer of the Year. From left to right: Mayor Emanuel, Dave Potash, Melvin Potash, Marian Schuman and Art Potash.

Potash, the second generation of his family to run a small grocery chain in downtown Chicago, credited his dedicated employees for keeping his family business successful and IRMA and other associations for allowing him to have a say in how legislation impacts the ability to help his business grow and prosper. He also praised his father, Melvin, and his uncles, Dave and the late Herb Potash and his aunt, Marian Schuman for their dedication in starting the business.

“Our success in good times and resilience during the tough times is due to our close and mutually beneficial relationship with our employees,” Potash said.

“Our stake in the association makes us better retailers and allows us a vehicle to give back to an industry that’s been so good to us. It’s important to us that we can voice our opinions, provide input when asked or agree to disagree on issues affecting our business and our community.”

IRMA President & CEO David F. Vite praised the family’s service of more than 60 years as a remarkable tribute to what retailing is all about. He praised Melvin Potash for his decades of work on industry issues, and thanked Art Potash for answering the call and going to Washington, D.C. to lobby for the swipe fee amendment.

“Unlike elected officials, our constituents vote every day whether they want to go into that business,” Vite said. “So Potash Markets is the longest serving elected official in this room because they’ve been serving consumers for over 60 years.”
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Durbin praises Potash as ‘key voice’

In a special video message at IRMA’s 54th Annual Luncheon, U.S. Senator Dick Durbin extolled Potash Markets CEO Art Potash, calling the Chicago retailer his “secret weapon” in the successful fight to cap debit card swipe fees at the national level.

“I am particularly pleased to congratulate Potash Markets for receiving the 2011 Illinois Retailer of the Year Award,” Durbin said. “Art has been one of the key voices for merchants not just in Illinois, but across America in our fight to reform the unfair swipe fee system.”

Durbin introduced an amendment to the Wall Street Reform Bill in 2010, call for debit card swipe fees that VISA and MasterCard fix on behalf of big banks to be reasonable. Potash spoke at Durbin’s press conference in Washington, D.C. just prior to the U.S. Senate’s vote to pass the amendment.

“It was no coincidence,” Durbin said. Anybody who’s listened to Art, and people all across our state who understand this issue, know that he was a powerful advocate for a powerful idea. He explained in clear terms how the swipe fee system is not fair to Main Street family businesses like his own in Chicago.”

Durbin said his success in fighting back attempts by the banks and card networks to kill the reform amendment earlier this year would not have been possible without Potash.

While the Senator explained vigilance is necessary because banks and card networks will not stop fighting retailers on this issue, he also mentioned other issues important to retailing on the national level, such as the Main Street Fairness Act and the fight against Organized Retail Crime.

“I think we can make progress on the issues we’ve talked about,” he said. “We put together a bipartisan coalition with the Illinois Retail Merchants and associations just like theirs all across America. That bipartisanship worked. We got it done. Thank you to the Illinois Retail Merchants Association for partnering with me in these efforts.”
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Chairman’s remarks

Good afternoon and welcome to the 54th Annual Luncheon of the Illinois Retail Merchants Association.

I am Richard Cohen of Macy’s and it’s been my privilege to serve as IRMA’s chairman over the past two years.

As you can see from the newsletter story at each of your places, this year’s Illinois Retailer of the Year, Potash Markets, has succeeded in business because of its exceptional service to customers and commitment to the Chicago neighborhoods in which they operate. The Potash team, like many retailers in this room today, is also to be commended for its service and commitment to the industry.

Because of your participation, our collective voice has stayed strong. I’m proud to look back over the last two years and say that by working together we’ve been able to accomplish a great deal.

In 2010, IRMA took a lead role in a $13 million appliance rebate program and Illinois retailers responded in a big way, selling 100,000 appliances worth more than $64 million. The Energy Star Appliance Rebate Program was funded with federal stimulus money and it created a frenzy of buying activity on two different dates – once in April, and again in September. Never had sales been so brisk in so short a time period. During the first sale, retailers moved more than 60,000 appliances in 11 hours. On the second date, retailers moved more than 37,000 appliances by 10:30 in the morning.

We also benefited with a second sales incentive program last year when Illinois ran a Back-to-School Sales Tax Holiday program for 10 days in August. By offering a temporary suspension of the state’s use tax of 5 percent on eligible clothing, footwear and school supplies below $100, Illinois retailers had a rare price advantage over counterparts from our neighboring states. The program was a resounding success. Customers crowded our stores buying all sorts of products, some tax-exempt and some not. Even consumers from other states shopped here, bringing dollars we might not otherwise have seen.

Earlier this year, Illinois proved to be a leader in the industry when Gov. Quinn, after the input of many retailers, signed into law one of the toughest organized retail crime laws in the country. ORC is one of the fastest growing types of crime against retail, costing hundreds of millions of dollars each year across our nation.

The new Illinois law greatly expands law enforcements’ ability to charge and prosecute the leaders of the sophisticated rings of thieves who operate in multiple jurisdictions at once. It also sets greater penalties for those involved in ORC, and allows for the forfeiture of assets purchased with money made from the crime – a huge financial disincentive to ORC.

Trying to find a catalyst to reinvigorate the Streamlined Sales Tax issue in Illinois and across the country in March, IRMA was successful in passing the Main Street Fairness Act, closing a painful loophole for brick and mortar retailers in Illinois and forcing remote sellers to treat a sale as a sale no matter how it’s done. This effort has caused Illinois and other States across the nation to again consider and become active in the Streamlined Sales Tax process. Our state, which was losing hundreds of millions of dollars because of companies which were willfully evading their responsibility to collect sales taxes, is now a national leader in helping to restore fairness to the industry.

Finally, this past June, we saw passage of the most sweeping reform of Workers Compensation of Illinois since 1975. The bill was the result of many months of very intense negotiation. While it didn’t accomplish everything we wanted, IRMA Directors agreed something needed to be done. In the end, the reform will provide at least $500 million in annual savings to the employer community in Illinois – the biggest savings reduction in the history of workers compensation.

These examples were only the major highlights of so many smaller yet important accomplishments for the retail industry in Illinois. There are simply too many more to mention.

So as I finish my term as your chairman, I want to thank you for working with us on these and other issues. If it wasn’t for the service and commitment from you, our dedicated members, we couldn’t have accomplished so much.

While there are still challenges and hard work ahead, I leave the leadership of this great organization knowing IRMA is well-positioned to continue making strides in the future. And I sincerely hope all of you will continue your commitment to this association, because as Potash Markets has shown us, service is what it’s all about.
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IRMA Board changes

C.J. Schnakenberg, owner of Chicago Brass, began his second term as chairman of the Illinois Retail Merchants Association Board of Directors on Sept. 14. Schnakenberg, who previously served as chairman in 2007-08, replaces outgoing chairman Richard Cohen of Macy’s. Cohen, who remains a Director, served as chairman since 2009.

Bob Jones, Jr., American Sale, Tinley Park, will serve as IRMA’s vice-chairman. New to the Board of Directors this year is Tim Lehan of Lehan Drugs, Dekalb, and Brian Baer, president of Dominick’s, Oakbrook.

Lehan will take the seat of outgoing director Dale Kirlin, Kirlin’s Hallmark, Quincy. Kirlin had served as a director since 1996. Baer fills the vacancy of former Director Don Keprta of Dominick’s.

Outgoing IRMA Board Chairman Richard Cohen of Macy's, left, and incoming Board Chairman C.J. Schnakenberg of Chicago Brass, right, meet Chicago Mayor Rahm Emanuel at IRMA's 54th Annual Luncheon

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Contemporary Style; Old-School Service

The Potash family (from left to right): Dave Potash, Art Potash, Melvin Potash and Marian Schuman.

From her usual spot at the front of the store, Marian Schuman is the first to notice when a regular customer – a blind woman – walks into Potash Markets holding her red-tipped cane. Marian turns to find an employee who will assist her, but Cortez Tiner has already set aside his other work and is moving in to help.

Tiner gently rolls a shopping cart her way and offers to be her guide. So she hands him her shopping list and they begin their trek down the first aisle.

It’s that sort of personal attention, the kind of above-and-beyond service that is standard fare at Potash. With two grocery stores nestled among the skyscrapers of downtown Chicago and a third inside a skyscraper, this family-run business is committed to old-fashioned, personalized service.

Potash succeeds by offering something few other stores can: personal connections dating back a half-century. Melvin and Dave Potash, two of the three original owners, still work every weekday alongside their sister, Marian Schuman. Their oldest brother, Herb Potash, who passed away in 2005, worked five decades in the business. Five employees have worked there more than 40 years.

They know many of their customers by name and often know their customers’ parents and children as well. Clark Street store manager Jeff Iwamuro estimates he personally knows at least half the people who walk in the door. Many customers at the State Street store greet store manager John Robertson by name.

The result is a personal touch that reflects the Potash family’s values.

“These owners are old-school. It’s just the way they treat people,” Iwamuro said.

Their friendliness fosters warm relationships with employees, vendors and community groups. Their generous nature benefits the entire retail industry, not only through active participation in trade groups, but through extra efforts on specific issues. Mel’s son, Art Potash, recently participated with U.S. Senator Dick Durbin in his successful campaign to cap credit card swipe fees.

For their success, dedication to customers and employees and commitment to the industry, the Illinois Retail Merchants Association named Potash Markets its 2011 Illinois Retailer of the Year.

“These are people who take care of their own – their family, their employees, their customers and neighbors. They give back to people in generous ways and continue to give their time and effort to the retail industry as well,” said IRMA President & CEO David F. Vite. “We’re proud to honor them in this way.”

Potash Markets on North Clark Street in Chicago.

Walking into any of the three Potash Markets, one notices a well-lit store filled with contemporary foods such as fresh seafood, sushi and organic fruits and vegetables. This is not your grandparents’ grocery store.

But the service is like a flashback to a 1950s TV sitcom. It’s almost like a time-warp that sends shoppers back to the days when gas station attendants washed windshields and boys delivered groceries on bikes.

Still today, the first generation of the family business continues to serve customers and employees as they have for decades.

At the Clark Street location, silver-haired Dave Potash is busy bagging groceries. His younger sister Marian stands between the front door and the cash registers, alternately answering the phone and greeting customers. Melvin, the youngest of the siblings, works seven days a week, doing a little bit of everything, but always coming up with new ideas to make it easier for the customers to shop.

“We’re addicted. It’s like a drug,” Marian said. “I’ll never take a Monday, Thursday or Saturday off – never.”

“We just love to do it, that’s all,” said Dave, who continues to work five days a week.

Herb Potash (left) talks on the phone while his brother Dave operates the cash register in the early days of the family business.

The grocery business was a natural for Herb Potash. After working for his uncle’s store in the 1940s, he knew enough to get started in business for himself. Plus, he had a couple of younger brothers – Dave and Mel – who were willing to partner with him.

So in 1950, with the help of their father, Max, the Potash brothers began their retail career with a store called Pleez-ing Foods on the corner of Clark and Schiller, on the near north side of Chicago. Their sister Marian came to work for them at the urging of their mother.

“They had very humble beginnings, really just modest success for the first few years,” said Melvin’s son Art.

From the beginning they dedicated themselves to quality customer service. Business was not complicated, but they worked long, hard hours.

The Potash brothers did everything a good neighborhood grocer could: delivered to households, offered charge accounts for regular customers and even gave cash advances, later adding it to the customer’s monthly bill.

Not much changed until the early 1960s when Herb opened Potash Bros. Food and Liquor at 875 N. State Street. Dave and Melvin opened a separate store on North Avenue. In 1967, the North Avenue store was moved to its current location at 1525 N. Clark Street.

They got to know their customers and treated them as friends and neighbors. The combination of convenience and personal service kept the customers coming back. By the late 1960s, the store on Clark Street boasted the highest sales volume per square foot of any grocery store in the country.

By the mid-1990s, both stores became known as Potash Bros. Market. The name finally changed with the re-branding last year to Potash Markets.

Potash Markets also has a third location for residents inside the John Hancock Tower and a Potash Bros. Ace Hardware store across the street from the grocery on Clark Street.

From left to right, siblings Melvin Potash, Dave Potash and Marian Schuman.

Art Potash grew up in the grocery business, watching his uncles and father work together and helping at the store from time to time with his brothers, pushing shopping carts and delivering circulars around the neighborhood.

After graduating with a Bachelor of Science Degree in Food Distribution from the University of Illinois’ School of Agriculture he joined Kroger’s highly regarded management training program for four years then returned to the family business in Chicago.

While the three Potash brothers hoped to see the store passed on to a family member someday, it wasn’t going to happen automatically.

“They worked too hard to just give it away,” Art said. “So it was understood I was going to have to earn any responsibility I was going to take on.”

Art proved himself time and time again, first with a smaller remodeling project, then bigger ones. Mel and his brothers soon grew confident Art would be able to carry the business into the next generation. Now the older generation has passed on the torch to Art.

“It’s hard to give up things,” Mel admits. “But once we saw what Art could do, that made it easier. Otherwise we would’ve sold out.”

Art may have earned his family’s confidence, but to become a part-owner he had to buy-in to the business. His fathers and uncle helped make it possible by putting together a 10-year buy-in program and eventually Art became one of the owners.

The youngest partner recently brought 21st century business practices to the mix, adding a Facebook page and even Twitter to its marketing plan. The older generation of the Potash family may not understand everything about social media, but they do realize that times change and have confidence in Art to lead them into the next century.

“Art’s a super kid. Smart. He knows what’s going on,” Dave said. “It was time to let Art take charge.”

Potash managers (from left to right) Dave Scapardine, Eddie Bayron, John Robertson and Bob Dickeson, surround Art Potash (center) at the Potash Markets store on North State Street.

Years ago, as a teenager, when Tony Mastrangelo worked for the Potash Brothers, he and some friends would head to Fenwick High School after work to play basketball before the gym closed at 10 p.m. One Friday night, Herb Potash asked the boys what they were doing that evening. When they told him, Herb grabbed a shopping cart and loaded it up with chips, pop and pretzels.

“He took care of us,” Mastrangelo said. “That goes through that whole family. They don’t miss a beat.”

The Potash family always enjoyed being part of the lives of their employees, customers and neighbors, watching their families grow, and offering them good food and good service.

It’s the reason Potash Markets doesn’t turn down customers’ requests for charity, why they celebrate the birth of their customers’ children, and why they offer flexible schedules to employees when circumstances change.

“This is about people and about family and about working together for a common cause,” Art said. “We like to see our customers doing well and to see our employees’ families growing and we like to be part of it.”

Potash knows that while bigger companies must focus on the bottom-line numbers, he strives to be people-orientated first.

“Of course we have to be profitable to sustain the business, but it’s the people part that’s so rewarding,” Art said. “We have customers who have become friends, employees with families we’ve gotten to know. It’s just a nice way to do business, a nice way to go through life. It makes the whole process more enjoyable.”

The Potash family pledged total commitment to their neighborhoods, so they keep the store open 365 days a year. They regularly hire family members of current or former employees, helping those who have helped them.

“What they’ve done in Chicago is phenomenal,” said Rich Niemann, Sr., head of Niemann Foods, Quincy, and a long-time friend of the Potash family. “That speaks to the quality people they are – genuine, values are high. There are simply not enough adjectives to describe them.”

“He’s a compassionate guy,” said Illinois Food Retailers Association President Brian Jordan. “He cares a lot for his employees and cares a lot for his customers.”

Mastrangelo, who worked for Potash on and off into his 20s before eventually starting his own business, the Superior Nut and Candy Company, said he once turned the Potash family for advice when he needed to secure a bank loan or risk losing his business. Instead of offering advice, the family simply loaned him the $63,000 he needed, with easy-pay-back terms. Thanks in part to the Potash family’s help, Superior now employs more than 100 people.

“They had so much faith in me,” he said. “They probably figured they were doing something nice for someone who had helped them.”

Potash store manager Jeff Iwamuro (with plaque) is a two-time finalist for the Food Marketing Institute's Store Manager Service Award. He is surrounded by (left to right) Melvin, Art and Dave Potash.

The Potash philosophy of caring about customers in a personal way is shared by those who worked alongside the owners for so many years. Manager Jeff Iwamuro, twice recognized by the Food Marketing Institute as a finalist for its Store Manager Service Awards, said it couldn’t have happened without the leadership of the Potash family.

“It’s nice the owners allow you the freedom to serve customers in a personal way,” Iwamuro said. “At other stores, they’ll expect you to get your shelves stocked in a set amount of time. Here the customer comes first, so you can have an effect on what happens.”

Iwamuro’s goal for the staff is to make every shopper feel that they have their undivided attention. They help them find specific items, unload their carts, offer carry-outs and on-time deliveries. The store even collects birth information from new parents and delivers a fruit basket with a baby-sized Potash Bros. t-shirt and a photo album filled with newspaper clips from the day the child was born. Sick customers may receive flowers; newly married customers are treated with a bottle of imported wine.

Potash Markets will put together last-minute deli trays and accept after-hour phone orders, even if it means calling a messenger service to deliver the orders. Managers know their customers well enough to give them cash advances when their ATM card fails or when they simply forget their money at home. The company has about 700 loyal customers with House Charge Customer Accounts.

Cindy Kienzle, a vendor who sells her Hungry Monkey bakery goods to Potash stores, once lived above the State Street store and shopped there for years. But it was more than just the convenience factor that made her a regular.

“When you go in there, it’s almost like you’re part of the family,” Kienzle said. “They knew my name, I had a house charge. For being a smaller store, they carry a lot of products and offer great quality. The prices were reasonable. They didn’t gouge their customers.”

Over the years, Melvin developed some innovative ways to bring customers to the store. He once sent employees to the empty parking lot of another grocer that was closed on Christmas Day. As cars drove in looking for somewhere to shop, employees directed them to their store. The customers loved that they told them Potash was open.

Another time, he paid a bus company to pick up elderly customers and drive them to the store. When someone pointed out that it might be costing more money for the bus than they were receiving in business, he didn’t care. He simply wanted to serve his customers.

“Mel will lose money on a sale to please the customer,” said Potash accountant Wayne Jacobs of Jacobs & Newmark, P.C., Buffalo Grove. “He’s almost not in it for the money. He’s in it because he loves the customers. I’ll tell him, you’ve got to watch the payroll. He’ll say, if it costs me money, I don’t care.”

It’s really Mel’s way of keeping the emphasis on the customer and knowing the rest will take care of itself.

Potash Markets on North State Street, Chicago.

Over many years of exceptional service, the Potash brothers’ attention to service began to create an unusual problem. The customers most in need of attention – the older shoppers – were getting just what they asked for: most of the employees’ attention. But that left the younger customers with a little less than personal service.

“It wasn’t intentional, but we were nurturing the older end of our demographic and alienating the younger end,” Art said. “We communicated with them more, so we began carrying older standards of product.”

In essence, Potash Markets started becoming an older grocery store. But it was changing so gradually those inside the company simply weren’t seeing it happen. Finally a new assistant store manager brought the problem to light.

“He just mentioned that for a couple grocery stores in young locations, we were getting an older slice of the pie. We hadn’t noticed that before,” Art said

After he was told the store was obviously catering to an older crowd, Art noticed a downward trend in sales. He realized if the company was going to have a future, he was going to have to adjust to the needs of the neighborhood.

So in early 2010, Art called Steve Mehmert of Mehmert Store Services, Sussex, WI, and started the redesign plan. By Aug. 2010, they began making changes. The State Street store was completed just before Thanksgiving last year and the Clark Street store was finished in March.

The redesign gave both stores a more contemporary look with attractive, well-lit displays. Even the exteriors were given a make-over to advertise the stores’ upgrades.

The mix of product changed as well, with a focus on fun, health foods and a deli of restaurant quality. It highlighted Potash Markets’ commitment to fresh foods, realizing many of their customers were singles, couples and even small families who shop several times a week, often buying two oranges at a time instead of an entire bag of fruit.

Mehmert said Art’s decision to reduce the frozen food section and increase the fresh goods was unusual for a grocer because it meant they would be dealing with more products with shorter expiration dates.

“I don’t think most retailers are going to do what he did,” Mehmert said. “Art’s constantly improving and on the move. He’s ahead of that curve a little bit, always studying the marketplace and always looking where he can be innovative.”

The State Street store converted a self-serve meat department into a full-service meat department, with all natural and prime meats, cut-to-order, and their signature sausages which are created in-house. It was designed to prepare meats for all three grocery stores.

Art learned his lesson from the experience and now asks his new employees to write down their first impressions and review them after their first 30 days. If something still stands out after the first month, the issue is addressed by management.

“We need that fresh pair of eyes; that influx of ideas from the outside,” Art said.

Art once asked his managers how they should display the nuts, trail mix and dried fruit packaged with the Potash name. John Robertson thought these Potash products should go on the top shelves. Art considered Robertson’s opinion, but instead decided to have high-end chocolates placed on the top shelf at the State Street store.

Later, when managers were creating a similar display at the Clark Street store, they made an independent decision to try the Potash products on the top shelf, with chocolates on the lower shelves. When Art saw it, he liked his managers’ display much better than his own. ‘Whoever told us to do it the other way should be fired,’ Art joked.

“It’s definitely a partnership with Art. He’s not going to tell you what to do. We discuss things in meetings,” Robertson said. “Almost everything we do is open to discussion. He’s always saying, ‘what do you think about that?’

Art is much like his father, Melvin, in that he doesn’t like to brag or take credit for accomplishments. Instead, he searches out employees’ suggestions, giving them some say in the decision-making process.

Potash Manager Dave Scapardine said his team enjoys the freedom to make decisions without winding through a complex corporate approval process. Store managers and department managers simply talk and make decisions on the fly.

“We all don’t have these huge egos,” Scapardine said. “The final decision is always going to be what’s best for the store.”

“Here you can have an effect of what happens,” Iwamuro said. “The feeling of ownership, it’s instilled from the owners. As long as I’ve been here, I’ve taken personal ownership in what goes on here.”

The owners and managers are so respected by employees that many want their son or daughter to have the same work place experience. They will bring their teenage children to Art and simply say, ‘I want him to work for you.’

The family connection is nothing new at Potash. Kathy Lent, an employee for 48 years, met her husband while working there. Another employee with 33 years at Potash has had four of her children work in the stores. The company has eight employees who have worked there for 20 years or more and another 15 who have been there for at least 30 years.

“We kid people a lot. When they hire you, they’re hiring you until you retire,” John Robertson said.

Sometimes it’s true. Fred Lewandowski was 17 when he started working at Potash in 1960. Now 68, he still works in the meat department on a part-time basis.

“It’s the thing we’re most proud of – there’s not a better testament than length-of-service,” Art said. “It doesn’t happen by accident. We try to take care of them and they have a real commitment to the business. It all takes the right people and it takes effort by everyone and we’re very proud of that.”

Most of the 180 employees at Potash are part-time. Some split time between stores, including the hardware store and the John Hancock grocery. Those that prove to be honest and hard-working can usually stay as long as they want.

Raul Cardenas, assistant store manager at the Clark Street store, understands the Potash philosophy of taking care of those who take care of the customers.

“If you treat your employees right, they’ll treat your customers right,” Cardenas said.

If the employee is going through a particularly difficult time, the owners may offer them an interest-free loan. When circumstances change in their life, from a new baby to having to care for a sick relative, managers will re-arrange their work schedule.

These personal touches result in a caring workplace where employees don’t feel like a number. Assistant Manager Bob Dickeson said he came to Potash because he wanted a job with a family feel; his colleague, Assistant Manager Eddie Bayron, said that family feel is what sets Potash apart from other places he’s worked.

“Retail is different here,” Bayron said. “Here the customers call you by name and that just feels good.”

The Potash family tries to make it a fun place to work too. Last year on Christmas Day, Potash raffled $25 every half hour for 40 employees who volunteered to work (for pay). As customers checked out, they were asked to pull an employee’s name and announce the winner over the P.A. system. One shopper, a retired university professor, talked on the P.A. for 15 minutes about the pleasant experiences he has had in the store and mentioned several employees by name.

Potash develops similarly close relationships with its vendors, especially with the smaller vendors that match up well with their company.

“They can’t service a big store, so to them, we’re a big customer,” Art said. “We seek them out. So for us, that means we carry items that chains don’t carry.”

Potash Markets’ Facebook page includes a long list of local vendors.

“They really value local vendors. They like to keep it in the community as much as possible,” said Potash communications consultant Camille Winer.

When Cindy Kienzle started looking for stores in the City of Chicago to carry her desserts from her new business, The Hungry Monkey Baking Company in north suburban Lake Forest, she immediately thought of Potash Markets.

A long-time Potash customer, who moved out of the city several years ago, Kienzle knew first-hand about their level of customer service and that their customers were looking for something they couldn’t find anywhere else.

“I just walked in and talked to Art,” she said. “It was perfect timing. They had just rebranded and were looking for specialty foods. It was a combination of things – the look and the taste fit with their rebranding. He knew me and knew I had been in business and was responsible and wouldn’t let him down.”

Art Potash stands near U.S. Senator Dick Durbin during a May 2010 press conference in washington, D.C. announcing Durbin's swipe fees amendment.

When Senator Durbin was looking to publicize his credit card swipe fees amendment last year, his staff called the Food Marketing Institute and asked if they knew of any retailers in Chicago who would be willing to speak at his press conference. The FMI suggested its own Board Member, Art Potash and asked him if he would be willing to attend.

At first, Art agreed to participate, as long as he didn’t have to speak. But when they called back and asked if they could hold the press conference at Potash Markets, Art knew if agreed to host it, he would be obligated to say a few words.

“It was kind of a defining moment for me,” Art said. “I never liked public speaking, but I always thought people should stand up for something they believed in. So this was my chance to step up and actually get involved.”

His participation went so well that Durbin’s office asked him to attend a second press conference in Washington, D.C. in May. Art was amazed. Here he was, the operator of a small Chicago grocery business, and he was in the nation’s capitol working to help retailers across the country.

“It was unbelievable to me. It was like a dream! It was fantastic to see it come to fruition,” Art said. “That’s what was impressive about being involved – thinking about the number of merchants across the country that will realize some savings.”

Art is also a Board Member of the Illinois Food Retailers Association where his father, Mel, is a past chairman. Both father and son say they want not only to hear about what’s going on in the industry, but they want to be involved.

“They’re such dedicated people. They never turn down a request to help with issues and they do it with a sense of commitment to the industry,” said IFRA’s Brian Jordan.

Art was nominated for the FMI Board by Rich Niemann, Sr., an industry veteran who understands first-hand the challenges of running a family grocery business.

“I’ve had a great respect for Mel over the years,” Niemann said. “And I’ve noticed that Art is very respectful for the business. I thought Art would really be a compliment to the FMI Board. He is a quality person.”

Through his involvement in IFRA, Art has gotten involved with IRMA programs and events such as IRMA’s Electric and Gas buying programs and Retail Day in Springfield.

“We really appreciate what IRMA does for the industry. The cooperative effort between IRMA and IFRA is what makes us stronger,” he said. “It’s been a great experience.”

When Susan Nicholl, executive director of Special Olympics Chicago, needed some help getting the word out about her fundraising event, the Chicago Polar Plunge, she called on Potash Markets. The idea was that Potash could tell its customers about the event and those customers would then help support it.

But she got a little more help than she expected after talking to Potash store manager Jeff Iwamuro. The store also donated water and fruit for the event, and if that wasn’t enough, connected Special Olympics with some Potash vendors who offered donations of their own.

“They not only did the flyer distribution, but they had employees wearing t-shirts, information about it in their weekly bulletin. Jeff just told me, ‘get me the information and we’ll make it happen.’”

“They’re almost too good to be true,” Nicholl said. “Their support was just overwhelming.”

The fact that Potash Markets went above and beyond the request for help not only showed what kind of people owned the business, but how their generosity trickles down to their staff. Both store managers regularly answer requests to support community events and programs, from the Latin School and Ogden International School, to various not-for-profit boards their customers serve.

During the 2010 holiday season, the Latin School asked for support for their annual food drive. Potash donated food and 500 empty shopping bags for students to fill. The school filled its basement with goods for a local food pantry.

“As our neighbor, Potash will go out of the way to support our school,” said Evelyn Girardet of Latin School. “Everyone at Potash – from the management team to the cashiers, baggers and delivery people – is more than happy to help.”

Potash also lends support to various not-for-profit organizations throughout Chicago. Even if they aren’t in the neighborhood, the store often helps by donating anything from a bottle of imported wine to bottled water.

“If customers come in to ask for something for their fundraiser, we’ll help them out,” Art Potash said. “After all, they’re our customers. They help keep our business going, so we try to help them.”

When Art Potash returned from the southern U.S. all those years ago to join his family business, he knew the kind of commitment he was making. But it’s the way he’s handled that commitment – much in the same way Melvin, Dave, Marian and the late Herb Potash handled it – that positively impacted so many others.

Now Art is moving ahead with changes to make sure his family business stays relevant, but he won’t abandon the philosophy that has worked so well for the past half-century. With this family, it’s always been about more than just customer service. It’s about caring for people, whatever role they may play in their business and their lives.

“What you see is what you get with them,” said Wayne Jacobs. “They’re the type – not selfish, not greedy – but fair. That’s why their employees stay with them so long. That’s why their customers return and why business associates stay with them.”

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Lottery updates technology

Special Edition: Illinois Lottery

With a new provider in place for the Illinois Lottery, IRMA is publishing this special edition of The Retail Register to inform retailers about the Northstar Lottery Group, the changes to the lottery system and the benefits of those changes.

“Northstar’s program is not only a great opportunity for the retail community in Illinois, but for the entire state,” said IRMA President & CEO David F. Vite. “Lottery sales not only provide jobs and boost state revenues, but Northstar will help fund non-profits and bring awareness to many worthy causes.”
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New era for Illinois Lottery means new opportunity for retailers

It’s a new day for the Illinois Lottery.

In January, the state signed a 10-year private management agreement with Northstar Lottery Group, a consortium of best-in-class global lottery companies. Under careful state oversight, Northstar is now managing day-to-day operations and marketing initiatives in a move aimed at maximizing lottery revenues that fund education and capital programs across Illinois.

Early data shows that 2011 is going to be an historic year for the Illinois Lottery.

Over the next five years, Northstar expects to generate $5.2 billion in profit for the State of Illinois. The growth plan seeks to attract new players in new markets and double the number of lottery retailers, all while embedding a best-in-class responsible gaming program across all of its operations.

The new private manager model is already showing signs of success with the Illinois Lottery achieving record sales in March, April, May and June.

The heart of the new strategy is MVP – More Valuable Prizes – new and innovative lottery games, larger prizes and more chances to win. Prize payouts and prize structures at every price point have been revamped and there are more prizes at lower levels to increase the number of meaningful winning experiences. Illinois Lottery has also launched new and more appealing instant ticket games, such as Cash for Life, which rewards players with the largest prizes ever on $1, $2, and $5 instant tickets.

Northstar is making gains in retailer recruitment as well. In the last four months, almost 1,500 new retailers have completed applications. Additionally, Northstar now offers Spanish Terminal Training for many retailers.

Over the next three years, Northstar seeks to boost the number of retailers by 60 percent. Northstar CEO, Connie Laverty O’Connor, makes this focus clear.

“Nothing is more important than our retailers, and getting their input as we begin this exciting new journey together,” O’Connor said. “They are the ones selling our tickets; they’re the ones on the front lines with our players.”

O’Connor stresses that Northstar is committed to operating by its core values of integrity, transparency, passion, inclusivity and responsibility. The Illinois Lottery helps build a better Illinois. Revenue from the sale of Lottery tickets reduces the burden on Illinois taxpayers. Last year, $657 million of the state’s budget was offset by profits from Lottery sales. Benefits also appeal to retailers who are taking a fresh look at the potential to sell Illinois Lottery products including:
• The direct revenue benefit. This includes a 5 percent commission paid on every ticket sold plus bonuses paid on winning tickets. Retailer commissions average more than $15,000 annually, with top retailers earning more than $120,000. Indeed, profits-per-square-foot can be greater for lottery products than many other popular retail items. And unlike other products, there’s no up-front cost to retailers and no spoilage.

• The indirect revenue benefit. A lottery product offering can be a boost to retail sales of other in-store items. Studies show lottery players visit stores 26 percent more frequently than non-lottery customers, spend twice as much per visit and buy other products along with their lottery purchase 85 percent of the time, reinvesting a portion of their winnings in the store.

• The ease and low cost set-up and maintenance. Setup involves an application process and a single classroom training seminar. All point of purchase displays are provided free and the accounting and system maintenance is quick and automatic. Illinois retailers are already enjoying the benefits of new terminals, linked to a new satellite/cellular communication system. A new central gaming system will be launched in late August and will help further transform retailer accounting, reporting and player protection.
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Northstar well-positioned to bring energy, innovation to IL Lottery

Northstar Lottery Group has been granted a ten-year contract to responsibly drive Illinois Lottery growth and returns to benefit Illinois residents. But who is Northstar? And why are they ideally positioned to bring new energy and innovation to Illinois Lottery?

Northstar is really a consortium of three leading companies created specifically to bring world-class practices to the Illinois Lottery in a socially responsible manner. Each of the member companies brings their own specific area of expertise.

• GTECH is a leading lottery technology and services company. With 7,500 people in more than 50 countries, GTECH provides management, innovative technology, creative content and superior service delivery to effectively manage and grow toda’s evolving gaming markets. GTECH is a wholly owned subsidiary of Lottomatica Group, one of the world’s largest commercial lottery operators and a market leader in the Italian gaming industry.
• Scientific Games is a global leader in providing customized, end-to-end lottery solutions to organizations worldwide. Scientific Games’ integrated array of products and services include instant lottery games, lottery gaming systems, terminals and services, and internet applications, as well as server-based interactive gaming machines. Scientific Games serves customers in about 50 countries.
• Energy BBDO, the Chicago-based unit of BBDO Worldwide, one of the world’s leading consumer marketing and advertising companies.

Combined, the Northstar companies have a strong record of working together to launch and re-launch some of the largest lotteries in the world. In fact, they are partnered with 13 of the 14 lotteries that have achieved the highest level of certification for responsible gaming by the World Lottery Association.

Guiding Northstar Lottery Group’s operations is a six-member Board of Advisors, comprised of civic and business leaders from around Illinois. Former Cook County State’s Attorney Dick Devine chairs the committee, which guides Northstar’s community partnerships, diversity initiatives and charitable contributions.
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Benefits of lottery extend beyond finances

The Illinois Lottery is a public trust. It exists to provide resources and support to communities across the state.

Through increased sales, the Illinois Lottery helps build roads and schools, fund public education, and provide thousands of jobs for Illinoisans. These revenues reduce the burden on Illinois taxpayers. In fact, last year $657 million of the state’s budget was offset by profits from lottery sales. With aggressive plans in place to expand revenues, the partnership with Northstar will only increase the benefits to the state.

But the benefits are more than just increased revenues. The Illinois Lottery and its private manager, Northstar Lottery Group, are dedicating a great deal of attention and resources to a suite of socially responsible initiatives, such as:

- Donating 5 percent of Northstar’s profits to community organizations throughout Illinois, without a cap. This will mean millions in extra funding for Illinois not-for-profits.

- Specialty games that support and bring visibility to worthy causes such as veterans programs and AIDS awareness.

- Awarding millions of dollars worth of contracts to firms owned by minorities, women or people with disabilities.

- A comprehensive program to promote responsible gaming and prevent underage and excessive play. This includes making sure all retail locations have responsible gaming information on display, public awareness campaigns and resources available to retailers and players who need assistance and referral information.

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Interested in joining lottery?

Businesses interested in joining the Lottery team can call 855-MY-LOTTO (855-695-6886) or visit www.northstarlottery.net/retail-opportunities. Getting started is easy. There is an application process and $50 application fee. Once accepted, retailers will attend one classroom training to learn about the system and responsible gaming procedures. Shortly thereafter the equipment will be installed in the store location free of charge. Ongoing management of the system is easy with automated accounting and easy to use technical support.
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Retailer cash bonuses expand

In the latest example of the new spirit of cooperation between the Illinois Lottery and retailers, starting on Aug. 21, cash bonuses will be awarded to stores selling winning tickets cashed in for less than $600. Currently, retailers do not receive commissions unless the prize is $600 or more. This will mean an additional $10-$11 million in bonuses for retailers each year (conservative estimates based on data from previous 12 months).
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Lottery updates technology

Northstar is providing new, state-of-the-art touch screen terminals with high-speed thermal printers and enhanced reporting capabilities. The new terminals have a smaller footprint design which fit easily in most retail locations. Another immediate benefit of the new technology is that promotions, winning numbers, sales amounts and other timely information will be readily available to players on the 17-inch flat-screen monitors that the Lottery will provide and install free of charge. Information is updated via satellite which is a major labor saver.
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Gov. Quinn expected to sign historic Workers’ Compensation Reform

Gov. Pat Quinn is expected to sign into law this month the most sweeping reform of Illinois’ workers’ compensation system since 1975.

The legislation, which is expected to provide at least $500 million in annual savings to the employer community was the result of intense negotiations over many months and the dedication and persistence of many in Springfield.

“This is the first substantial and meaningful reform of the system we’ve seen in a long time,” said IRMA President & CEO David F. Vite. “The expense of the old system made it vital for Illinois to enact reform. But we wouldn’t have this reform without the hard work and tenacity of so many of our leaders. If you choose to accept the low-ball estimate of $300 million or the top end of $700 million, this equates to 10-20 percent of the total cost of workers’ compensation in Illinois. Members of the Assembly who supported the bill are to be saluted for not letting the perfect get in the way of the possible.”

Illinois State Representative John Bradley (D-Marion) spearheaded the talks on Workers' Compensation.

The bill is not without controversy. In the House debate all GOP members initially voted ‘No.’ They cited three reasons: the Bill did not go far enough; the Bill was punitive to the medical community; and the GOP was not included in the negotiations. On the second and final vote all Democrats in attendance and one lone Republican – Chris Nybo (R-Lombard) – supported the Bill.

After hearing from constituents during the 2010 election cycle, Senate President John Cullerton (D-Chicago) and House Speaker Michael Madigan (D-Chicago) began the effort in the fall of 2010 calling for bi-partisan hearings to create a Bill which would save employers money. While nothing passed during the closing days of the 96th General Assembly in January, reform talks re-started in the spring, headed by Rep. John Bradley (D-Marion), Sen. Kwame Raoul (D-Chicago) and Gov. Pat Quinn.

Senate Republican Leader Christine Radogno, after participating in scores of hours of hearings, was a pivotal player in forging a compromise that would be supported by 15 of her GOP Senate colleagues. Chicago Mayor Rahm Emanuel actively supported the reform and played a key note in its success.

In the end, employer savings comes with no concession on benefits. Whether it is the $700 million in savings projected by the Governor’s Office, the $600 million projected by the medical community or the $300-$500 million suggested by some naysayers, it is the biggest savings reduction in the history of workers’ compensation.

The legislation will require physicians to use American Medical Association (AMA) standards to determine impairment and arbitrators to use AMA standards when determining disability. Employers will create provider networks and employees will be allowed to choose either a doctor within or a doctor outside of the network.

The bill imposes a 30 percent reduction in the Medical Fee Schedule and strengthens utilization review to ensure proper and necessary medical care is administered.

It also eliminates lifetime wage differential payments in favor of payments during workers’ careers, and reduces carpal tunnel syndrome payments to a maximum of 28 weeks.

The Senate will approve arbitrators, who must be attorneys (held to judicial ethics canons) and undergo training in AMA standards, utilization review and more.
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Swipe fee relief survives in Senate

Relief from ever-increasing credit card swipe fees is only a month away.

The U.S. Senate on June 8 rejected the Tester-Corker amendment that would have delayed swipe fee reform for six months, thanks partly to the leadership of Senator Richard Durbin (D-IL), who pushed to include the fees in the Dodd-Frank Act.

Senator Durbin helped drive the amendment as part of comprehensive financial reform to limit fees merchants pay to accept major credit cards. His Illinois counterpart, Senator Mark Kirk (R-IL), voted to delay the reforms.

Currently, when consumers swipe a VISA or MasterCard to make a purchase, the credit card companies and their issuing banks charge the merchant an interchange fee, also known as a swipe fee. Swipe fees have tripled since 2001 and in 2008 cost consumers and merchants $48 billion. Durbin’s amendment limits these fees on debit card transactions and would protect small businesses of Illinois and consumers from the bad behavior of big banks and the credit card industry.

Placing a cap on the fees would reduce the current $20 billion a year in debit swipe fees by about $1.2 billion a month.

“This is a real victory for retailers,” said IRMA President & CEO David F. Vite. “The retailing industry is no longer at the mercy of the credit card companies and banks. We certainly thank Senator Durbin for his determination in getting the fee caps in place and fighting off the attempts to delay the legislation.”

The Senate’s vote left the Tester-Corker amendment six short of the 60 votes needed for approval. Without passage of the proposed delay, the fee caps are scheduled to take effect July 21. Retailers are awaiting the Federal Reserve’s final rules before implementing the reforms, but it promises savings for both retailers and their customers.
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Future came quickly to retail industry

It’s hard to image how we functioned in the days before texting, Twitter and Facebook, before smart phones and YouTube.

But back in the late 1990s, when retailers worried more about the Y2K scare than their daily online sales reports, cell phones were only making calls and email was only opened at the office. In 1998, 24 percent of retailers had websites, and 40 percent of American households had personal computers.

Just prior to the turn of the millennium, the world was on the verge of rapid change and retail experts made bold predictions about where new technology such as cell phones, the Internet and email would take us over the next five to 10 years. The industry has undergone vast changes since then, some expected and some unexpected.

In a 1999 Chicago Tribune article about the future of the grocery industry, futurist Rich Wolf said people would embrace Internet grocers like Peapod, Inc., saying “with several exceptions, the supermarket is going to go away.” Others expected most manufacturers and suppliers to bypass traditional retail and sell to customers directly and pure-play Internet sellers to overtake brick and mortar retailing.

“That was just nonsense,” retail consultant George Whalin said, recalling the many predictions. “All those things that go on in a store just can’t be duplicated on a website. The Internet just wasn’t going to put retailers out of business.”

With the exception of Amazon.com, it was the brick and mortar stores – companies with retailing knowledge and experience – that succeeded in selling online buying needs of the consumer. Today, online sales still make up only 11-12 percent of the retail sales.

In 1999, retail consultant Jim Dion told retailers “the next five years will bring more change than they have seen in the last 50 years.” Looking back at that statement today, Dion said not only did it come true, but the pace of change hasn’t slowed since.

“The world was turned upside down. There was more change from 2000-2005 than in the previous 50 years. But there was even more change in the next five years after that. We now have exponential change,” Dion said.

Dion once predicted the retailing industry beyond 2000 would be driven by information and knowledge, not merchandise or geography. Today that is true – even the customer is armed with product and pricing knowledge that has changed shopping forever.

While Dion may have been on target about the tools and technology retailers that was to come, he notes that many companies have still not made the investments in available technology. Most retailers still don’t have one single database connecting customers across all channels and he said they’re missing an opportunity to serve their customers.

“The retailer at a brick and mortar store should know if the customer is someone who regularly buys from that store’s website,” he said. “But they have no idea. Very few retailers have a single view of customers. It’s stunning.”

But the vast majority of retailers still are not operating with available technology to track sales by the minute, in real-time, because they simply don’t want to spend the money. Whalin pointed out that there are even retailers working without a point-of-sale system in their store.

But customers have certainly taken advantage of the technology, buying at kiosks, on their phones, and through social networking sites like Facebook.

The changes haven’t been all what we expected. Dion pointed out that at one point everyone was excited about the possibilities of multi-media communications. As it turns out, simple texting is one of the most powerful tools available.

Technology will continue to change the industry in the coming years. Even the least of the smart phones today is more powerful than the technology used to put man on the moon, Dion said. And that computing power is doubling each year.

“Consumers really want to buy anything anywhere at anytime,” Dion said. “And for the most part, they can. But that will continue to evolve.”

Whalin said technology will be a driving force in the future and will help retailers in purchasing decisions so they don’t get stuck with so much overstock as they did in the fall of 2008 and 2009.

“Retailers are much better at buying than they were just a couple years ago,” he said. “They just had to adopt the technology.”

Amidst all the changes, the essence of retailing remains the same.

“The six rights of retailing are still the same – product, place, time, quantity, price and service. Technology aids and abets getting those rights righter,” Dion said.
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Sales growth slows in May

Rising gas prices and a weak labor market dampened the trend of consumer spending in May retail sales, according to the National Retail Federation.

Though retail sales rose for the 11th straight month in May, going up 0.1 percent seasonally adjusted from April, only a few retail sectors reported growth. Meanwhile, the U.S. Commerce Department May retail sales report (which includes auto sales and gas stations) shows total retail sales decreased 0.2 percent seasonally adjusted over April.

Sectors showing increases included health and personal care stores, and clothing and clothing accessory stores. Sectors showing decreases from April to May included furniture and home furnishing stores and electronics and appliance stores.

Seasonal weather helped boost building material and garden equipment stores sales, in spite of weak housing market reports.
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Survey: Retail shrinkage up

Retail shrinkage, organized retail crime and cargo theft are growing problems for retailers, according to surveys conducted by the National Retail Federation.

Retail shrinkage increased to 1.58 percent of retail sales in 2010, up from 1.44 percent in 2009, according to an NRF survey in collaboration with the University of Florida. Total retail losses cost retailers $37.1 billion last year, up from $33.5 billion in 2009, according to the survey.

NRF’s recently released Organized Retail Crime survey found 95 percent of retailers have been a victim of organized retail crime over the last 12 months.

Of the 129 retail companies participating in the NRF’s Organized Retail Crime Survey, nearly all (94.5 percent) have been the victim of organized retail crime in the past 12 months, an increase over last year and the most in the survey’s history. An increasing number of retailers said thieves are becoming more brazen and that, on average more than one in 10 organized retail crime apprehensions (13 percent) lead to some level of violence, such as physical assault and/or battery.

According to the ORC survey, 84.8 percent of retailers say organized retail crime activity has increased within the last three years. Retailers reported that, on average, 12 percent of their organized retail crime cases involve collusion between internal and external actors, shedding light on the substantial role a handful of corrupt employees can play in organized retail crime.
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Business Day 2011:
Governor highlights workers compensation goals

Illinois Gov. Patrick Quinn told 300 business leaders at the Business Day 2011 Luncheon that he wants meaningful reform of the state’s workers compensation program before legislators leave Springfield at the end of the month.

Illinois Gov. Patrick Quinn speaks at the Business Day 2011 Luncheon at the President Abraham Lincoln Hotel and Conference Center in Springfield.

“In workers’ compensation, there’s a role for reform to play. I don’t want the legislature to go home on May 31 without a meaningful reform – a system that understands the needs of business and the rights of the workers,” Quinn said.

While it isn’t clear if such reform will be accomplished, Quinn told members of IRMA and the Illinois Manufacturers’ Association that he wants to see workers’ rights protected while lowering the high costs to businesses.

“Many businesses pay more in workers’ compensation premiums than in taxes. We hope to save at least a half billion dollars with our reforms.”

Using a powerpoint slide show, Quinn outlined the four principles he wants in any reform proposal: ensuring fairness; care for injured workers; savings for employers; and restoring public trust.

The governor explained he wanted arbitrators to be fair, injuries must arise in the course of employment, quality care must be provided efficiently to injured workers, unnecessary care must be stopped, injuries should be measured by objective standards, the cost of care must be reduced and fraud prosecution stepped up. He also suggested setting guidelines for arbitrators to improve standards and public trust in the system.

Reform will take a careful compromise between business groups, unions, lawyers, doctors and hospitals. The governor stressed that everyone in the state is in this together.

“No one is going to get scalped; everyone is going to get a haircut,” he said. “The bottom line is we want to professionalize the workers’ compensation system for everyone in Illinois.”

IRMA President & CEO David F. Vite praised Gov. Quinn as a friend of Illinois business, citing two important retail bills that were initiated during the last veto session. Vite said the governor’s pledge to reform the system was very important, reminding the luncheon crowd that there have not been any major changes to the Workers’ Compensation Act since 1975.
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Business Day 2011: Legislators offer workers compensation perspectives

Two legislators who have worked diligently on workers compensation reform told Business Day Luncheon attendees they are working hard toward their goal of fixing Illinois’ broken system

Illinois State Representative John Bradley (D-Marion) speaks to the Business Day Luncheon audience on May 4 in Springfield.

Illinois State Representative John Bradley (D-Marion), the point person for the Illinois House on workers’ compensation, was blunt in his appraisal of the current system.

“The Illinois system is broken. It needs reform,” Bradley said. “The state has the second highest fee schedule to Alaska. To get to third place, we have to reduce the fee schedule by over 50 percent. Doctors, lawyers, hospitals, unions all are going to have to give something up. The only way we have a chance (to get reform) is through a bi-partisan effort – with the IMA and IRMA. We are working toward this goal.”

Illinois State Senator Kyle McCarter (R-Decatur) said Illinois is way behind other states in fixing workers compensation.

“Seldom has anyone had a fair settlement. It’s gone on too long. We just have a bad law,” McCarter said.

“But there is at least one advantage Illinois has (over other states that have reformed workers compensation): We can learn from everyone else’s mistakes.”

While McCarter sponsored workers’ compensation legislation, it did not receive Democrat’s approval in the Senate.

He assured business leaders that the bill “represented the comments of the business community.”

Illinois State Senator Kyle McCarter (R-Decatur) addresses state business leaders during Business Day 2011 Luncheon at the President Abraham Lincoln Hotel and Conference Center, Springfield.

“We were unsuccessful at that time because we ran into opposition within both political parties. We simply didn’t have the votes,” Bradley said. “We’ve been attempting to accomplish since that time meaningful workers’ compensation reform.

“We appreciate the contributions the folks in this room make every single day. We want to provide relief to Illinois businesses,” Bradley said.
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Business Day 2011:Chairman calls for competitive business climate

Speech given by IRMA Chairman Richard Cohen of Macy’s on May 4, 2011 at the Business Day Luncheon

It’s certainly good to see so many of you attending today’s events. Your role in the legislative process is crucial to decisions made at the Illinois Statehouse – decisions that directly impact your bottom line.

In fact, the impact can be so great you may as well consider the Governor and the General Assembly partners in your business. And you certainly don’t want your business partners making decisions without your input.

But our state legislators are dealing with a huge budget deficit – in the neighborhood of $8 billion even after raising the personal and corporate income tax rates.

Things are challenging in business as well. Raw materials, food and gas prices are all rising and our customers – saddled with these same burdens – have fewer dollars to spend in our stores.

In these times, competition is fierce. That’s good – competition makes us better. Many of us in this room compete against one another. But our legislative partners see us as a single group, competing against businesses just across our borders in Missouri, Iowa, Indiana, Kentucky and Wisconsin.

They’d like to see job growth on the Illinois side of those borders. They’d like to see sales tax revenue grow from customers visiting from these other states. But we realize we’ll only get there if the business climate in Illinois allows us to be competitive. This is where our state leaders can help.

They have examples to build on. For 10 days last August during a statewide sales tax holiday, Illinois had the lowest sales tax rate on back-to-school merchandise of any state in the Midwest. Customers crossed the Mississippi River to shop in Illinois and still more ventured across state lines from Wisconsin and Indiana.

If we’re going to be able to help the state government with their challenges we need to create jobs that will generate the revenues necessary to fund a lean state government.  It’s vital we work with them to improve the business climate in Illinois.

We have to tell them first-hand about our challenges in retaining or creating jobs in Illinois. That’s what today is all about – speaking in a unified voice to our business partners here in Springfield and making it clear that the more they can help us, the more we as a business community can help the State of Illinois.
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Job gains in retail industry

Retail jobs rose by 57,000 nationally in April, with general merchandise stores leading the way with 27,000 jobs, according to the U.S. Department of Labor. Meanwhile electronics and appliance retailers and building material and garden supply retailers each added 6,000 jobs. Overall, total non-farm payroll employment increased by 244,000 jobs in April.

In Illinois, the year-over-year unemployment rate fell in every county for an unprecedented fourth straight month in March, according to the Illinois Department of Employment Security. Unemployment rates also feel in every metro area in the state for a record seventh straight month.
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Obituary: Former IRMA Chairman John Spiess

Former IRMA Chairman John E. Spiess, retired President and CEO of the Joseph C. Spiess Company, died May 8 in Bonita Springs, FL. He was 90.

Spiess graduated from the Elgin Academy before going on to earn a Bachelor of Science degree in Commerce from Northwestern University. He worked at his family retail business – a small chain of specialty department stores based in Elgin – as a buyer and merchandise manager before taking over as president.

In 1961 he became IRMA’s fourth Chairman of the Board. Besides his work with IRMA, he served as President of the Elgin Chamber of Commerce and as a board member of the First National Bank of Elgin and the Elgin Community Chest of United Way.

IRMA staff offers its sincere condolences to the Spiess family.
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Obituary: Former IRMA staff member Julie Dahl

Former IRMA staff member Julie K. Young-Dahl passed away April 21 in her Lincoln home. She was 45.

From March 1990 through April 2001, Dahl served as IRMA’s member services coordinator. She was born July 7, 1965, the daughter of Ronald and Mary K. Bergman Young of Lincoln. After earning a B.A. in marketing from Western Illinois University, she worked as an intern in IRMA’s Chicago office. In her time at IRMA, Dahl assisted members with IRMA’s insurance and bankcard programs and helped coordinate education and training seminars such as the “Selling is Your Business” program.

The IRMA staff extends its sincere condolences to her family.
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Illinois Governor Pat Quinn signed into law on March 10 the Main Street Fairness Act, requiring all online retailers doing business in Illinois to collect sales tax for the state.
The new law closes a painful loophole in Illinois and forces internet companies to treat a sale as a sale, no matter whether it’s done over a countertop or with a keyboard and mouse. Illinois was losing hundreds of millions of dollars in tax revenue because these out-of-state companies willfully evaded their responsibility to collect Illinois sales taxes.
“The Illinois Retail Merchants Association proudly stands with Gov. Pat Quinn as he signs House Bill 3659 into law,” said IRMA President & CEO David F. Vite. “This puts Illinois as a national leader in restoring fairness – fairness for retailers, fairness for the economy but most importantly, fairness for taxpayers.”
When online retailers do not collect sales tax, the tax is still owed and the responsibility falls to the customer who is required under current law to report and pay use tax to the state on these purchases.
“Thanks to the leadership of the legislature and the Governor’s action today, we can all rest easier knowing the right policy prevailed and everyone is now on an even playing field,” Vite said.
One day before the Governor signed the bill, the Alliance for Main Street Fairness (AMSF) launched a web page in response to online-only retailers threatening to terminate relationships with in-state affiliates to avoid playing by the same rules as Main Street and collecting sales tax.
The AMSF is ready to help small businesses to connect with other retailers interested in doing business with them and collect the sales tax at the point of purchase.

Online partnerships offered to affiliates

IRMA, along with the Illinois Department of Commerce and Economic Opportunity, are promoting a new website dedicated to connecting former Amazon.com and Overstock.com affiliates with other brick-and-mortar retailers eager to win their business.

After Illinois Governor Pat Quinn signed a new law requiring Amazon, Overstock and other out-of-state online retailers to collect sales taxes, the companies said they would stop accepting referrals from, or paying commissions to, Illinois businesses.

The website – www.standwithmainstreet.com – is hosted by the Alliance for Main Street Fairness and serves as a clearinghouse to bring these retailers and affiliates together.

“By using this website, affiliates who were left out in the cold by Amazon and Overstock can find retailers who want their business, while ensuring a smooth transition for consumers and businesses alike,” said IRMA President & CEO David F. Vite.

Major Illinois retailers such as Barnes & Noble, Best Buy, Sears, Home Depot and Wal-Mart have stepped up and demonstrated a commitment to the viability of the state’s economy by offering to work with these affiliates. Affiliates that sign up online will be contacted by the companies participating in the project and will have the opportunity to explore relationships with several new business partners.

“We are pleased to collaborate with IRMA and the Alliance for Main Street Fairness in providing Illinois affiliates with this opportunity to easily connect with retailers to keep their business growing,” said Warren Ribley, director of the Illinois Department of Commerce and Economic Opportunity. “This program demonstrates the commitment by brick-and-mortar retailers and the Quinn Administration to ensure tax fairness and provide consumers with the best options available as we work to create jobs and revitalize the state’s economy.”

Gov. Quinn recently signed legislation dubbed the “E-Fairness Law” correcting a long-standing problem where out-of-state businesses were skipping out on collecting sales tax on purchase made online by Illinois residents. The law levels the playing field by protecting taxpayers, ensuring state government collects the tax revenue it deserves and helps strengthen the economy and protect and create jobs.

Make plans to attend Retail Day 2011

Retailers from across the state will gather in Springfield on Wednesday, May 4 for Retail Day 2011, an opportunity to learn about retail-related legislative issues first-hand and meet with state leaders at the Illinois Statehouse.

Retail Day 2011, part of the Business Day 2011 event, will be hosted by the Illinois Retail Merchants Association in conjunction with the Illinois Manufacturers Association at the President Abraham Lincoln Hotel and Conference Center in Springfield.

The event is an ideal opportunity to find out more about legislative issues impacting your company’s bottom line and discuss these issues with other retailers and with elected officials. Some of the current issues in Springfield include a proposal for a $1 increase in tax on a pack of cigarettes, a proposal to allow all municipalities to license and regulate business, and a plan by Senate Republicans to balance the State budget by cutting at least $5 billion in spending.

While the specific issues may be different by May 4, it is nevertheless important for retailers to make their presence felt in Springfield at Retail Day. To keep posted on current Illinois issues relating to the retail industry, read This Week in Springfield at www.irma.org.

The program starts with a noon Luncheon at the President Abraham Lincoln Hotel and concludes with an evening reception offering live music, food and drink and a chance to meet casually with legislators and fellow business leaders.

To register for Retail Day, contact IRMA at 1-800-572-5044 or email dbasowski@irma.org. Individual registrations are $85 per person. Meeting and hotel registration deadline is Tuesday, April 12. A limited number of rooms are available at a group rate of $102.99 per night at the President Abraham Lincoln Hotel and Conference Center. Ask for group code “IRMA” and call 866/788-1860 for room reservations.

Retailers need to develop compliance plan when handling recalled products

Most members have read news accounts profiling the increased emphasis on product recalls and the corresponding local, state and federal regulatory actions related to recalled products. As just one example, the Illinois Attorney General recently received attention related to the safety of infant cribs. However, it is important for retailers to be aware that the regulatory pitfalls related to recalled products don’t only apply to manufacturers. Product recall laws also apply to any retailer that sells any consumer product regulated by the United States Consumer Product Safety Commission (CSPC), the Federal Drug Administration (FDA), or any applicable state law. It is, therefore, critical for members to have policies and procedures in place to monitor and remove shelved products subject to recall. As retailers may find out all too quickly, the speedy removal of recalled products from their shelves may protect the retailer from a violation. For example, children’s products falling under the Children’s Product Safety Act are required to be removed from a retailer’s shelf or coded in the Point of Sale system as blocked for sale within three (3) days of a recall notice.

Retailers should evaluate and, if necessary, update their recalled products compliance plan. The CPSC suggests retailers designate a “recall coordinator” with authority to take steps necessary to remain in compliance. The designated recall coordinator should have an understanding of the function, purpose and procedures used by the CPSC. The recall coordinator’s responsibilities should include receiving product recall information, notifying management, executing removal and serving as the primary liaison with the CPSC. It is recommended that each retailer institute a product identification system which maintains information such as model identification and date-of-manufacture codes. Once a recall is issued, these policies will enable retailers to more quickly identify and remove recalled products. All information relating to complaints, warranty returns, insurance claims, lawsuits, production runs, distribution records, quality control records, product registration cards, membership loyalty cards and credit card purchase information should be kept in an organized manner. By preemptively centralizing this information, retailers will be better prepared for the inevitable product recall and can reduce the potential impact on business after a product has been recalled. Relatedly, if ever sued and/or prosecuted, a properly executed compliance plan will enhanced the retailer’s ability to defend itself.

As part of the compliance plan, retailers should sign up for alerts from the CPSC and the FDA. These notices generally identify the product being recalled, UPC codes, model numbers, date codes and pictures of the recalled product. The notices often include recommendations for the necessary steps each retailer should take. Once an alert is received, retailers should diligently work to remove the recalled product from shelves.

Additionally, if capable under its POS software, retailers should have a plan in place to stop sales at the point of sale. That way if a product is, for any reason, not removed from the shelf, a consumer never actually could leave the store with the violative product. It is important to note that retailers also should post recall notifications in an effort to notify previous purchasers of the recall. Such efforts also will assist members in arguing that they are in compliance.

Retailers that do not have a recall product policy in place run the risk of regulatory prosecution. For example, the City of Chicago treats recalls very seriously and prosecutes retailers who fail to comply under the City’s deceptive practices ordinances. Such administrative prosecutions can result in substantial fines and, in extreme cases, business license suspension or revocation. Of particular concern is the City of Chicago Municipal Code’s broad definition of a “sale,” which includes simply an offer to sell. As a result, the City traditionally has prosecuted retailers for having recalled products on their shelves even where a “stop sale” is in place. This suggest that the City requires actual “removal” of the product and not simply a “stop sale” when determining whether a violation has taken place.

Ensuring the utilization of a responsible compliance plan will go a long way for any member subject to prosecution and all members should ensure that such protocols are in place and monitored.

For additional information, members should consult and review the following websites:
www.cpsc.gov; www.fda.gov; http://www.illinoisattorneygeneral.gov/consumers/recall.html; http://www.cityofchicago.org/city/en/depts/bacp.html.

Proposal would block swipe fee reform

Legislation introduced on March 15 to delay swipe fee reform, scheduled to go into effect this summer, would block retailers from giving discounts to consumers using debit cards and would cost merchants and the public more than $1 billion per month, the National Retail Federation reported.

Senator Jon Tester (D-Mont) introduced the Debit Interchange Fee Study Act of 2011, which would postpone by two years the swipe fee reductions included in last year’s Dodd-Frank Wall Street Reform and Consumer Protection Act, and require a study of the issue.

Regulations proposed by the Federal Reserve in December to implement Dodd-Frank would lower debit card swipe fees from their current level of 1 to 2 percent of each transaction to a flat fee of no more than 12 cents per transaction for large banks that adhere to fees set by the card companies.

The move, scheduled to take effect in July, would reduce the current $20 billion a year in debit swipe fees by about $1.2 billion a month.

“Merchants are ready to pass lower swipe fees along to consumers in the form of discounts and other benefits as soon as reform goes into effect in July, but we can’t do that if Congress lets bankers stand in the way,” said NRF Senior Vice President and General Counsel Mallory Duncan.

U.S. retail sales up in February

National retail sales rose 0.6 percent from January to March and jumped 4.2 percent unadjusted since February 2010, according to the National Retail Federation.

Improvement was strongest at building material, garden equipment and supplies dealers, the NRF reported, as that sector rose 0.6 percent monthly and 9.6 percent over last year. Clothing and clothing accessory stores also increased 0.8 percent from January and 4.4 percent since February 2010. Sporting goods, hobby, book and music stores went up 1.3 percent monthly and 5.2 percent annually.

NRF President and CEO Matthew Shay said the challenge for retailers in coming months will be higher prices on cotton, food and energy.

Unemployment dips below 9 percent

The Illinois seasonally adjusted unemployment rate fell for the 13th consecutive month, dropping one-tenth of a percent to 8.9 percent in February, according to the Illinois Department of Employment Security.

The rate had been above 9 percent since February 2009. Since January 2010 Illinois added 85,100 net new jobs, led by 36,100 jobs in the Professional and Business Services sector and 26,700 jobs in Educational and Health Services.

The number of unemployed individuals fell for the 13th straight month in February to 588,500, the lowest level in 24 months. Since the state’s unemployment peaked at 11.2 percent in January 2010, the number of unemployed people in the state declined by 151,600.

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Illinois Gov. Pat Quinn announces a new Organized Retail Crime law designed to separate it from other felony retail theft and to serve as a deterrent to sophisticated crime rings.

Gov. signs major ORC law

The importance of Illinois’ new Organized Retail Theft law was pretty much summed up by those in attendance when Governor Pat Quinn signed the bill on Feb. 23 at a Target store in Chicago’s south loop.

As the Gov. Quinn stepped up to the podium to face TV cameras, he was surrounded by dozens of retailers from some of Illinois’ finest stores. Standing closest to the Governor were Cook County State’s Attorney Anita Alvarez, and IRMA President & CEO David F. Vite.

When policy makers, law enforcement officials and retailers get together like this, it never turns out well for retail thieves.

Before officially signing legislation giving Illinois one of the toughest Organized Retail Crime laws in the nation, Quinn praised the law for its power to protect retail assets, save consumers money and improve the state’s economy.

“This important new law will help protect retailers and communities throughout Illinois from the economically damaging practices of organized retail crime,” Gov. Quinn said. “Organized crime, where large amounts of goods are stolen through fraud or thievery, can cost all of us a great deal of money. It costs our merchants, obviously, but it also costs our taxpayers in money that isn’t probably paid in sales tax.”

ORC costs Illinois retailers an estimated $1.5 billion in losses each year, meaning about $90 million in lost sales tax revenue for the state. And because the criminals re-sell stolen items such as over-the-counter medicine and baby formula, sometimes after expiration dates, consumer health and safety is compromised.

One example was fresh in the minds of Cook County officials. This past summer, a warehouse on the northwest side of Chicago used by an ORC ring was seized full of stolen goods and $4.5 million in cash. Alvarez said she was optimistic the new law would help fight such cases.

“We’re on the verge of a new, more coordinated crackdown. It’s being assisted by this new law,” she said.

The law was the culmination of work by the Cook County ORC Task Force which included IRMA, the Cook County State’s Attorney’s office, the Chicago Police Department, the Cook County Sheriff’s office, Cook County, local police departments in Cook County, many Cook County-based retailers, and Illinois Senator Iris Martinez (D-Chicago).

Tough new law will deter ORC in Illinois

Life just got a little tougher for those trying to make a living stealing from Illinois retailers.

The new Organized Retail Crime law signed by Illinois Governor Pat Quinn on Feb. 23 gives Illinois one of the toughest organized retail crime laws in the country. It sets ORC apart from other retail theft and includes tougher penalties designed to make criminals think twice before targeting stores in Illinois.

Illinois Gov. Pat Quinn signs the state's new Organized Retail Crime law on Feb. 23. To his left are IRMA Senior Counsel Tanya Triche and Cook County State's Attorney Anita Alvarez.

“This is a great bill and a great step forward,” IRMA President & CEO David F. Vite said. “It’s the toughest, most stringent, and most up-to-date law in the United States.”

The legislation greatly expands law enforcement’s ability to charge and prosecute the leaders of the extremely sophisticated rings of thieves who operate in multiple jurisdictions at once and steal hundreds of millions of dollars in goods nationwide. The goods are typically resold in fencing operations, either online or out of warehouses and at flea markets. Criminals use the money to buy drugs, guns and in some cases, to fund terrorism.

The law sets greater penalties for ORC. When a person commits felony retail theft for the purpose of re-selling the merchandise at least three times in an 18-month period, the crime is placed in the category of a Continuing Financial crimes Enterprise. And if a person agrees with another to commit three or more such crimes, that person will be considered an organizer of CFCE.

The big difference in upgrading the crime from felony retail theft to CFCE is that it allows for the forfeiture of assets purchased with money made from the crime. The forfeiture of assets represents a major step toward providing financial disincentive to ORC organizers and participants.

The new law also adds a provision so that in the case of a sting, the undercover officer only needs a reasonable belief the goods were stolen in order to charge a fencer with theft.

“This discourages thieves from looking at organized retail crime as a quick source of revenue,” Vite said.

Cook County Board to repeal remainder of infamous 2008 retail sales tax hike over next two years

Bit by bit, the Cook County sales tax rate is headed back to where it was before July 2008.

On Feb. 25, the Cook County Board voted to repeal the remaining half of the 1 percent increase imposed when former County Board President Todd Stroger was at the helm. The repeal follows a campaign promise by new Board President Toni Preckwinkle.

The action means the county sales tax rate will drop by a quarter cent on Jan. 1, 2012 and another quarter cent on Jan. 1, 2013.

In 2008, the County Board raised the rate from 0.75 percent to 1.75 percent. That action, combined with state and city sales tax rates, gave the City of Chicago a rate of 10.25 percent and the distinction of having the highest sales tax of any major city in the nation.

But in December 2009, the Cook County Board – after several attempts – was able to partially roll back the county’s rate to 1.25.

These rollbacks mean the City of Chicago’s tax rate will drop from 9.75 percent to 9.5 percent next January and down to 9.25 percent the following January, barring any other sales tax rate changes on the part of the city or the state.

One of the big criticisms of the higher tax rate was that it was regressive, impacting many inner-city residents who cannot afford to travel outside the county to shop. But the high tax rate also discouraged spending in Cook County, especially along its borders with DuPage, Lake, Kane and Will counties.

“The action by the Cook County Board will not only benefit shoppers, but retailers in Cook County,” IRMA President & CEO David F. Vite said. “It should also help the county’s economic development since the tax climate is one of the biggest variables a business considers when looking to expand or open new stores.”

Proposal calls for increase in Illinois minimum wage

A proposal introduced in Springfield to substantially increase the Illinois minimum wage and do so on an annual basis is a recipe for disaster for young people, employment, and economic development in general, IRMA President & CEO David F. Vite said.

“Illinois already has the highest minimum wage in the Midwest and the third highest in the nation,” Vite said. “In the last month, Illinoisans have witnessed a parade of Governor’s from other states trying to lure employers away from Illinois. This proposal helps them make their case.”

Senate Bill 1565 proposes increasing the Illinois minimum wage by 50 cents per hour plus any increase in the U.S. Consumer Price Index (CPI) until the Illinois minimum wage reaches the current value of $1.68 in 1968.

Additionally, the sponsors propose eliminating the training wage exemption and the teen wage exemption. The training wage allows employers to pay workers 50 cents less per hour for the first 90 days of their employment. The teen wage allows employers to do the same thing for workers under 18. However, if employers choose to use these exemptions, they may only use one.

“Faced with a higher hourly pay scale, employers across the state will have to consider freezing or reducing the number of employees on their payroll. At the levels envisioned by S.B. 1565, not only would teenagers face grimmer employment prospects than they do today, but less experienced or efficient workers will also be negatively impacted,” Vite said.

In 2003, eight short years ago, the Illinois minimum wage was $5.15 per hour, based on federal law. As the two charts below demonstrate, it has increased dramatically in a short period of time to its current level of $8.25 per hour. That represents an increase of more than 60.2 percent in eight years or 8.6 percent annually, on average.

“As Illinois’ teen unemployment numbers demonstrate, the wage increases Illinois has imposed on its employers, in addition to higher state and local taxes, are unsustainable. Something must give and, unfortunately, the most vulnerable workers in our state are paying the price of these artificially high wages,” said Vite.

In 2009, the unemployment rate among 16-19 year olds was 25.8 percent. In the City of Chicago the situation was even more desperate with a teenage unemployment rate of 48 percent – the highest unemployment rate recorded for Illinois teens since 1974.

In an attempt to address teen unemployment, the City of Chicago instituted the “Youth Ready Chicago” jobs program. The City recognized that jobs for teenagers are not just about saving for college and discretionary income; they also serve to keep children safe.

Sign up now for Retail Day

Retailers from across the state will gather in Springfield on Wednesday, May 4 for Retail Day 2011, an opportunity to learn about retail-related legislative issues first-hand and meet with state leaders at the Illinois Statehouse.

Retail Day 2011, part of the Business Day 2011 event, will be hosted by the Illinois Retail Merchants Association in conjunction with the Illinois Manufacturers’ Association at the President Abraham Lincoln Hotel and Conference Center in Springfield.

The program starts with a noon Luncheon at the President Abraham Lincoln Hotel and concludes with an evening reception offering live music, food and drink and a chance to meet casually with legislators and fellow business leaders.

To register for Retail Day, contact IRMA at 1-800-572-5044 or email dbasowski@irma.org. Individual registrations are $85 per person. Meeting and hotel registration deadline is Tuesday, April 12. A limited number of rooms are available at a group rate of $102.99 per night at the President Abraham Lincoln Hotel and Conference Center. Ask for group code “IRMA” and call 866/788-1860 for room reservations.

Jobs Creation Act amended

The Illinois Small Business Jobs Creation Tax Credit Act has been subject to several legislative amendments.

First, the basic wage for the program that must be met or exceeded has been reduced from $13.75 per hour to $10 per hour or the equivalent annual salary of $25,025 to $18,200.

Under the new program guidelines, if a position pays at least $10 per hour, or at least $18,200 annually and it meets additional program requirements, the position would be eligible for the credit. To apply for the credit under the new guidelines, visit http://jobstaxcredit.illinois.gov.

The other amendment deals with employers who hire a former 2010 worker-trainee of the “Put Illinois to Work” program. Employers of any size who hire such a worker-trainee for a full-tie position by June 30, 2011, would be eligible to participate in the Illinois Small Business Jobs Creation Tax Credit Program.

For more information, contact jobstaxcreditprogram@illinois.gov.

NRF: More will use tax refunds on big-ticket items

More consumers will use their tax refunds to purchase a big-ticket item this year, according to a survey by the National Retail Federation.

The NRF’s 2011 Tax Returns Consumer Intentions and Actions Survey showed that 13.2 percent of Americans will spend refunds on a big-ticket item, up from just 12.5 percent last year. More people will also put their funds away for a rainy day (42.1 percent compared to 40.3 percent a year ago).

The survey showed that nearly 64 percent of Americans will have filed their taxes by the end of February and that more than 66 percent of taxpayers are expecting a refund this year, up from 65.5 percent last year.