Clubs and Organizations

Clubs and Organizations
Rotarians learn of retail sales pull factor

The Vermillion Rotary Club held its weekly meeting at the Neuharth Center on the campus of USD. President Roger Kozak opened the meeting and Rev. Robert Grossmann gave the invocation.

After the introduction of guests, President Kozak presented a slate of new officers, which was approved by popular acclaim. He also announced an exchange meeting here with the Yankton Club on April 17.


Rotarian Ralph Brown introduced Ms. Bethany Sorensen as the speaker for the day. Her topic was "South Dakota Retail Sales Pull Factor." The term pull factor measures the relative strength of the retail sector in a community.

The community with the highest pull factor is Keystone with a per capita income of approximately $81,300. Such a high per capita income is due to the impact of tourism in the area. The lowest income per capita was $692.

Ms. Sorensen used a useful statistical tool of aggregating the 11 highest cities and set that value to 1.0. Comparing various cities to the average showed that Vermillion was higher than average in some areas such as general merchandise and food sales but lower in other areas. Cities such as Vermillion and Brookings were lower than average in other areas such as automotive, furniture sales and apparels and accessories. This is likely because both cities have many college students with low incomes.

A statistical anomaly appears in reported sales in Vermillion comparing 2005 and 2006. Growth in general merchandise was up over 1,000 percent. In the same period Vermillion sales tax of 2 percent was up only 10 percent. The explanation may be that many businesses with income from more than one city aggregate their sales tax reports, which may have then been apportioned equally among the various cities. This could explain a shortfall of $2.2 million in sales tax when the predicted tax was $4.7 million. This may mean Vermillion is losing out on tax adjustment.

Ms. Sorensen said that looking at the full factor for Vermillion, a potential retailer might conclude that this is an underserved market. However, if the potential retailer also looked at the large population of students with low incomes, there may not be a guaranteed market.

Ms. Sorensen then took questions from the audience.

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