Consumers are less than enthusiastic about the economy these days, but that doesn’t mean parents still won’t splurge in order to send their kids off to school in style in 2011. While back-to-school spending isn’t expected to be as robust as in pre-recession years, the total haul will still be the 2nd largest spending period behind the Holiday season.
Customer Growth Partners has the most bullish forecast, projecting total retail sales (excluding autos, home improvement, gas and restaurants/food) for the July-September period to reach $467 billion, a 6.2% gain over last year and the largest increase since 2006. The company cites healthier household finances as the main reason for the optimism, as disposable personal income is up 3% from last year, household debt service ratios are down to 11.5% of income (lowest level since 1995), and the personal savings rate is down to 5% from 8.2% 2 years ago.
ShopperTrak expects bigger ticket prices will offset fewer shoppers at the stores, predicting sales will increase 3.8% in August over last year, with a 2.9% decline in foot traffic. “With back-to-school shoppers planning fewer trips to the store — and continued economic uncertainty — retailers must maximize the limited number of opportunities to convert browsers to buyers,” said ShopperTrak co-founder, Bill Martin.
The ICSC (International Council of Shopping Centers) expects sales at clothing, shoe, electronic and books stores to rise 3.0% to $39.0 billion in the July-September period, following a 5.0% gain last year. Michael P. Niemira, chief economist and director of research for ICSC, notes that while this year’s growth rate trails the average pace of the last 15 years, “the overall message from this projection is that sales are still likely to be quite healthy,”
Meanwhile, The National Retail Federation (NRF) is forecasting total back-to-school (K-12) and back-to-college sales of $68.8 billion, an increase of 2.5% over last year, but spending per family is expected to decline in both cases as parents replenished many of their children’s needs last year and 43.7% said the economy is forcing them to simply spend less in general. Continue reading ‘RetailSails 2011 Back-to-School Spending Report’
