Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Charles Cerankosky - FTN Midwest Securities Corporation.
Charles Cerankosky - FTN Midwest Securities Corporation
The first question is around, Craig, convenience. How do you think your store convenience plays right now with gas prices? And I'm asking it in the context of Spartan competing against so many supercenters?
Craig Sturken
Well, Chuck, as you know, we always talk about our stores being, quote, "closer, faster and friendlier." We feel that that is our competitive advantage, and in this market we believe that that's really helping us.
You know, one point to note is that Michigan's economy has been difficult for the state of Michigan for several years. And the economic downturn that's occurring throughout the United States today is really not brand new for us. It's something that we've been living with.
So we feel that the strategy that we crafted against the supercenters has already been tested and proven, and we believe that our fourth quarter results really indicate that we're in the right spot.
Charles Cerankosky - FTN Midwest Securities Corporation
You talked a little bit about trading down, and I also include into that moving into private label - which to me isn't necessarily trading down - but where you see signs of thrift appearing, is it different between your different banners?
Craig Sturken
I'd like to defer that question to Dennis Eidson, our President.
Dennis Eidson
We continue to look for this quantitative measure that says we can definitively say there's some change in the consumer buying behavior with respect to trading down, but frankly we don't find it. As you know, our private label performance has been very strong and it continues to outpace the industry average, so no change there.
And I think the other point Craig was making, the economy here in Michigan, the unemployment rate in Michigan has hovered between 7.1% and 7.2% since 2003. It really hasn't wiggled too much. So I think maybe that's why we're not feeling more of a fundamental shift that others are.
Charles Cerankosky - FTN Midwest Securities Corporation
You guys have been down for awhile, or the state's economy has been down for awhile.
Dennis Eidson
Exactly - 2003 unemployment was 7.1% and in 2007 it was 7.1%.
Charles Cerankosky - FTN Midwest Securities Corporation
Dave, a question for you regarding the operating profit margin difference between the segments. The vast majority of the profit margin in the quarter was in Distribution, only a little in Retail. I some of that has to do with the inter-segment accounting but can you address that, please?
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