Retail multipliers
Hello 
I am trying to understand an issue regarding retail multipliers. To take an example, in my geographic area, I have run $1,000,000 in gross sales in sector 324  Retail Stores  Food and beverage thru IMPLAN scenario function. The results indicate $281,000 in direct output and $586,146 in total output. The ratio of total:direct is 2.0859.
Separately, for the same geographic area, I have gone to Explore > Multipliers, which indicates that the Type SAM output multiplier for Sector 324  Retail Stores  Food and beverage is 1.4569.
This appears to be a discrepancy in the multipliers  unless I am somehow misunderstanding how the multiplier should be calculated in the first paragraph, or making another mistake  can you help? I also assume that the multipliers provided under the "Explore > Multipliers" menu are based on gross margins rather than gross sales?
Thanks.
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IMPLAN SupportHello David, The correct calculation for the SAM multiplier is Total Output/Direct, which it sounds like, for your situation, you are calculating. This should relatively closely match what is reported in the multipliers report unless you have customized. Can you provide us with information on what year and what region you are using? We tested this locally just doing a random model with this process yields the expected results. The multiplier is applied after the retail margin is separated from the purchaser cost. Hope this helps.0

Thanks for looking into this. I am using zips 86001 and 86004 as my geographic area, and 2013 as the year (1.000 output deflator, 1.000 GDP deflator, 100% local purchase percentage).0

Hi  A couple of followup questions:  Re: your comment that "The multiplier is applied after the retail margin is separated from the purchaser cost." In the case of this example, would the multiplier (either 2.0859 or 1.4569) be applied to the $281,000?  Just to confirm, would the "purchaser cost" be $1,000,000  281,000 = 719,000?  Also, does IMPLAN 3.0 provide an easy way to see a table of retail/wholesale margins for all sectors that have margins? Thanks  David0

IMPLAN SupportHello David, When we built a model of those ZIP Codes together in 2011, and set the Event Year to 2013, and Dollar Year for View of 2013, we ran a 1,000,000 value in Gross Retail Sales and received a very similar multiplier from the results that is in the Explore>Multipliers. The variance between the reported multiplier and the calculated being the results of deflation (i.e. set the Event Year to 2011, and Dollar Year for View of 2011 and run the same analysis, the multiplier matches to the 5th significant digit). In regards to your first question, the $1MM is multiplied by the margin factor, 28.1%, before that new Direct value is applied to the multiplier, 1.45, and then used to calculate the Indirect and Induced effects. 281,000 * 1.46 = $411,111 So in effect, the $1MM is never used in the calculation, just the retailer's operations portion. A purchaser cost is the value that the consumer pays. In this case, $1,000,000.00. The $719,000 that you calculated represents the average amount of the purchaser price that goes to wholesale distributor, transport, and the producer. In this case, because the item purchased is unknown, none of those can be determined so the entire value leaks from the system. There is a method to find these margin values. You will need to create and Event for the sector of interest, and click on Event Options> Edit Event Properties>Margins> Yes; then follow the same pathway, and select Edit. Please note that the retail margin is an average margin of all the products sold through that retailer. Let us know if you have more questions.0

Thank you  all very clear  all working fine now. Thanks.0
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