Consumers predicted to spend $75.8 billion on back-to-school, college in 2016

by Kim Souza ([email protected]) 101 views 

Estimates suggest that retailers from Wal-Mart Stores to local shops will see $75.8 billion spent by U.S. consumers, up 11.47% from 2015, during the back-to-school season, according to the National Retail Federation.

The bulk of the spending ($48.5 billion) is for those heading back to college. Families of college students are expected to spend an average of $888.71 this year, down slightly from $899.18 spent per family a year ago.

Families with children in grades K-12 plan to spend $27.3 billion which equates to an average $673.57 on apparel and accessories, electronics, shoes and school supplies. Spending is expected to increase 9.6% from 2015 with total growth of 54.8% over the past decade.

Spending dipped last year and experts say consumers often increase purchases one year as they stock up on supplies only to drop off the next year which makes sense for things like computers, calculators and backpacks that typically last longer than one year.

FAMILIES FOCUSED ON BARGAINS
The NRF annual survey completed by Prosper Insights & Analytics found parents are spending wisely.

“Families are still looking for bargains, but there are signs that they are less worried about the economy than in the past,” said NRF President and CEO Matthew Shay. “Heading into the second half of the year, we are optimistic that overall economic growth and consumer spending will continue to improve as they did in the first two quarters of the year. We fully expect retailers to be aggressive with offering great deals both in stores and online for back to school shoppers. And retailers will keep a close eye on inventory levels as families spread out their shopping throughout the summer.”

The following estimates are for families who have to restock what their children need for school:
• $9.54 billion on clothing (purchased by 95%)
• $8.27 billion on electronics such as computers or calculators (57%)
• $5.12 billion on shoes (94%)
• $4.37 billion on school supplies (96%)

The majority of the spending per household will be on clothing at $235.39 and electronics at $204.06 while $126.35 will be spent on shoes and another $107.76 doled out for school supplies.

The survey also indicates that 43% of families said they plan to shop for sales, which was up from 41% a year ago. One in three said they will compare prices online and 27% said the economy will not impact on their spending. That said, 23% of the respondents indicated they plan to spend less than a year ago.

Another survey by Propeller Insights on behalf of Ebates found that most years parents will need to find the “delicate balance between the things their teens want and the things they need,” according to Kevin H. Johnson, CEO of Ebates – a coupon and cashback provider for more than 1,800 retailers for those online shoppers signing up for the service

CONSUMER ATTITUDES
“The budget-conscious consumer is not forgetting about price, quality or value, and we continue to see this when it comes to back-to-school shopping,” said Prosper Principal Analyst Pam Goodfellow. “That is why many parents are taking advantage of shopping early, scouring ads and websites for the best deals, and taking advantage of free shipping with online purchases.”

Retailers have had school supplies out for the past month as more families try and tackle some of the spending earlier this year. About 73% said they begin shopping two months before school begins in order to reduce the hit on the monthly budget. Just one in five plans to wait until last week or two before the start of school to do their shopping.

Discount stores continue to be the top choice of 61% of shoppers this year, the lowest level in the survey’s history. More consumer (46% of parents) said they plan to shop online, up from 36% year ago. Those online shoppers said they take advantage of free shipping and conveniences such as pick up in store.

Fayetteville-based Field Agent conducted back-to-school research with more than 500 U.S. families in all income demographics. Survey results indicate that many parents are still struggling to budget in the costs of the children’s back-to-school needs. Nearly 8 out of 10 Field Agent respondents said back-to-school shopping was a strain on the budget. A majority of the respondents said they had to save ahead for back-to-school shopping.

Field Agent asked those surveyed where they plan to shop for back-to-school items this year.
• Walmart 77%, down from 87% last year
• Amazon 65%, up from 42% last year
• Target 59%, down from 76%
• Dollar Tree 33%, up from 29%
• Staples 28%, down from 33%
• Walgreens 16%, down from 30%

While price remains a top priority for shoppers, the respondents also mentioned product quality, brand name and in-store convenience were key to their purchases. Parents in the Field Agent survey cited the following concerns when shopping for supplies:
• More sales needed
• Keeping merchandise in stock
• Coordinating merchandise to the school lists

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