For retailers, the month of August has become almost as important as December when it comes to profits. As kids prepare to head back to school, parents spend billions on clothing, electronics and the standard pencils and erasers.
Back-to-school spending rose last year but this year, it looks like more children may have to make do with last year's retreads and thrift store purchases. The National Retail Federation's (NRF) annual Back-to-School Spending Survey, conducted by Prosper Insights & Analytics, shows the average family with children in grades K-12 plans to spend $630.36 on electronics, apparel and other school needs, down from $669.28 last year.
Total spending is expected to reach $24.9 billion, which is still quite a lot. When spending for college students is added in, the total jumps to $68 billion.
Spending up 42% in a decade
At the same time, the results show the bar has been set quite high. Over the last 10 years families have increased their back-to-school spending by 42%.
Regardless of the slight decrease shown for this year, NRF says the survey results point to a more confident consumer when it comes to spending and the impact of the economy. Fewer families say they will curtail spending because of economic concerns. This year, the needs are different.
“As seen over the last 13 years, spending on ‘back to school’ has consistently fluctuated based on children’s needs each year, and it’s unlikely most families would need to restock and replenish apparel, electronics and supplies every year,” said NRF President and CEO Matthew Shay. “Parents this summer will inventory their children’s school supplies and decide what is needed and what can be reused, which just makes good budgeting sense for families with growing children."
Retailers have already made the shift, hoping to entice parents and children with back-to-school promotions. On Friday, Walmart said it was preparing for a huge weekend, based on previous years' traffic.
“When the calendar changes from July to August, it’s like a switch flips in parents’ minds,” said Steve Breen, Senior Vice President of Merchandising for Walmart.com. “We can literally start to see it happen with a traffic spike on July 31, and this year we’re timing thousands of the season’s biggest Rollbacks to when we know our customers are coming to our site to check-off their back-to-school shopping lists.”
The NRF survey suggests 92.7% of back-to-school shoppers will buy new apparel, spending an average of $217.82. Families will spend about $118 on new shoes.
Of course, they'll also pick up school supplies but spend considerably less – about $98.
Last year electronics were a big seller, with 58.3% of parents spending more than $212 on gadgets for the kids. This year, for whatever reason, the survey suggests electronics fall further down the shopping list. Gadget spending is projected to average less than $198.