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This trend says retail's second-busiest shopping season won't be a bust

A Wal-Mart Stores associate stocks backpacks at a Wal-Mart location in the Porter Ranch neighborhood of Los Angeles.
Patrick T. Fallon | Bloomberg | Getty Images
A Wal-Mart Stores associate stocks backpacks at a Wal-Mart location in the Porter Ranch neighborhood of Los Angeles.

Though multiple forecasts are calling for subdued growth during retailers' second-biggest selling season, the industry's trade organization is making the case that shoppers are ready to stock up on new clothes and supplies to kick off the school year.

And it has the data to support it.

The National Retail Federation said Thursday it expects families to spend $75.8 billion to get their kids prepared for kindergarten through college. That would represent a gain of 11 percent over last year's prediction for $68 billion.

When breaking it down by household, the organization is calling for a 7 percent lift in average spending on children from kindergarten through high school, and a slight 1 percent decline on college students.

Overall, the NRF's outlook is decidedly rosier than forecasts released earlier this month by Customer Growth Partners and Deloitte, which have pegged their expectations at closer to 3 percent growth. (Deloitte's forecast only pertains to children from kindergarten through high school). If Customer Growth Partners' 3.3 percent forecast were to shake out, it would be the softest back-to-school growth since 2012, when sales increased 3.1 percent, the firm said.

The NRF's forecast, which was based on a survey of 6,809 shoppers between June 30 and July 6, follows a pattern. According to its historical findings, back-to-school spending intentions tend to oscillate between growth and contraction every other year, as consumers alternate between "stock up" and "make do" cycles.

That pattern has taken shape since 2012, when combined spending on back to school and back to college rose to $83.8 billion from $68.8 billion in 2011. Then, in 2013, the expected spending dropped back down to $72.5 billion, as consumers reused many of the items they bought the previous year. Given last year's planned contraction of more than 9 percent, it stands to reason that spending on this season would move higher.

"Consumers have some making up to do after taking a year off," said Ellen Davis, senior vice president of research and strategic initiatives at NRF.

"We don't think that this is an unsustainable trend that were seeing this year," she added, pointing to 2014's comparable spending figure of $74.9 billion.

Families purchasing for kids enrolled in kindergarten through high school plan to spend an average $673.57 this year for a total $27.3 billion. That compares with last year's average of $630.36 and $24.9 billion in overall spending.

The average family buying computers, apparel and other items for college-age students plans to spend $888.71, slightly lower than last year's $899.18.
That is likely the result of children making technology purchases while they're still in high school, and because of deflationary pricing in the category. However, total spending is expected to rise nearly 13 percent to $48.5 billion, as more families will be shopping for the event.

Though other organizations' predictions were not as bullish as those of the NRF, there are some common threads. Similar to the NRF's findings, a minority of respondents to Deloitte's survey said they plan to spend less on back-to-school shopping.

Both polls also found that families plan to start shopping earlier than was once traditional, with the NRF saying 73 percent of families are starting a month or two ahead of the first bell. That compares with 62 percent last year.

And while Customer Growth Partners' forecast was less optimistic about consumer confidence, pointing to a lack of real income growth as a major headwind, all three firms agreed that consumers would remain savvy and on the hunt for discounts.

"Back-to-school shoppers in 2016 will be cautious in spending, but relentless in searching for value," Customer Growth Partners' President Craig Johnson said.