JLL: High-income households could push back-to-school spending up 15.7%

by Kim Souza ([email protected]) 421 views 

A report from JLL predicts average back-to-school spending per child at $367, up 15.7% from a year ago. The report found 55.2% of parents plan to spend more money, 23.8% plan to spend less, and 18.6% said they will spend the same as a year ago.

Lower income earners below $50,000 said they plan to spend 11% more than last year but do not plan to go over $330, which is 9% less than the average. This cohort said they will also prioritize cost over other factors and they will also use buy-now, pay-later options.

Middle income households of $50,000 to $100,000 plan to spend 16% more than last year with a budget of $378 per child, 3% above the average. Households earning between $100,000 and $150,000 said they plan to spend 17% more than last year with a budget of $396, or 8% more than the average for this year.

Higher income families had mixed spending intentions. Those earning between $150,000 and $200,000 said they expect to spend 27% more this year but they were 2% shy of the average with a budget of $370. The households earning $200,000 or more said they will spend 21% this year and their average spend expectation was $491, up 34% which somewhat skewed the overall average. The higher income families do not plan to use deferred payments but said they will reuse existing school products and stick to their higher budgets.

While overall spending is expected to rise, half of the respondents said they will focus on necessities and 36.5% said they will reuse school supplies. One in five said they will look for less expensive, basic versions of the products on their shopping lists to stretch their budget, and 21.2% said they plan to buy secondhand items when possible. Nine in 10 respondents said inflation will impact how they shop for back-to-school.

JLL reports 78.4% of the respondents plan to shop with mass retailers and 68.7% said they will purchase at least some of the items online. The top three retailers where consumers planned to shop for back-to-school items were Walmart (58.6%), Target (54.2%) and Amazon (46%). The report also found most consumers plan to shop between two-to-three retailers to get all the items they need.

The survey found 69.5% of parents said they will look for sales in order to save money. And while some planned to begin shopping in June, most said they will stretch purchases out through September.

“Consumers will look for the sales, deals and other ways to save this back-to-school shopping season,” Naveen Jaggi, president of JLL retail advisory services, said in a statement. “They are looking to maximize the value of their spending, particularly during a challenging economic environment, but this has made value retail appealing to families seeking affordability and creates an opportunity for retailers to adapt for growth and success.”

The National Retail Federation will release a back-to-school spending report on July 24 based on surveys conducted in late June. Early data from that survey indicates 80% expect to see higher prices over last year and 45% plan to do more comparative shopping online, up from 30% from last year. NRF found 45% will look for sales more often and 39% will buy store brand or generic products to save money.

Also, 68% of respondents in the NRF survey plan to shop promotional events like Amazon Prime Day and other retailer events. Last year 64% said they would shop at promotional events from retailers like Walmart, Target and Amazon.