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Different takes on back-to-school

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NEW YORK — Two new forecasts take somewhat different views of how the back-to-school season may fare this year.

Two new forecasts take somewhat different views of how the back-to-school season may fare this year.

The Nielsen Co. is projecting that unit volume for the office/school supply category will fall 5.25% to 1.04 billion for this year’s season, although with many prices higher, dollar sales are expected to edge up 1.7% to $2.6 billion. "Unlike the holiday season, many consumers view back-to-school shopping as required versus discretionary purchases," said James Russo, vice president of global consumer insights for Nielsen. "That said, we see an extremely modest sales increase for this year’s back-to-school season. Look for consumers to spend their money carefully and focus on purchasing the essentials."

The Nielsen survey predicts that supercenters, dollar stores, drug stores and even warehouse clubs and grocery will see gains in this year’s back-to-school fray.

A more upbeat view emerges from Deloitte’s new back-to-school survey, which reveals that 28% of those polled said they plan to spend more this year than last, while 17% intend to spend less. Moreover, the number of consumers planning to change how they shop for back-to-school products (e.g., looking for sales or buying only necessities) is down to 58% from 70% last year and 90% in 2008.

"The survey indicates that consumers’ recession-induced behaviors are beginning to wane as households seek to replenish certain items and worry less about the economy," maintained Alison Paul, vice chairman and Deloitte’s retail sector leader in the United States. "Retailers may be encouraged that fewer consumers are planning to pare back this year, although they may find that shoppers continue to be deliberate in their purchases."

One suggestive note is that 26% of respondents said school budget cuts have resulted in parents needing to pay more for their children’s school items. Just over one-third said their children need more expensive items, such as computers. That might be one reason why office supply/technology stores displaced dollar stores as the second-most popular outlet for back-to-school shopping this year in the Deloitte survey. Discount stores remained No. 1 with 89% of participants.

The Deloitte survey yielded similar results to a poll conducted by Kantar Retail in June. Kantar found fewer (23%) of consumers planning to engage in back-to-school shopping than last year (30%), although more plan to increase their spending (21%) than to reduce their outlays (19%).

The Kantar poll predicts that Walmart will garner 64% of back-to-school traffic while Target will win 47%. As in the Deloitte survey, the prospects for office supply stores look good with 35% of respondents planning a visit.

Meanwhile, the National Retail Federation’s (NRF) 2010 Consumer Intentions and Actions Back to School survey, conducted by BIGresearch, found that the average American family will spend $606.40 on clothes, shoes, supplies and electronics, compared with $548.72 last year. Total spending on school-age children (including college students) is expected to reach $55.12 billion.

"We are encouraged by the fact that parents are eager to start their B-T-S shopping this year, but the industry still remains cautiously optimistic about recovery," said NRF president and chief executive officer Matt Shay. "As the second half of the year gets under way, retailers will gauge their customers’ spending appetites, which often serve as a bellwether for the all-important holiday season."

The survey found signs that the economy will continue to play a role in American families’ ¬B-T-S preparations. This year’s poll found that 44.3% of Americans said they will buy more store brand or generic products, compared with 41.7% who said so last year. In addition, more parents say they will do comparison shopping online to find the lowest prices (30.3% compared with 26.4% in 2009).

Discounters remain the top choice for B-T-S shopping, picked by 71.2% of survey respondents. Other popular destinations include department stores (53.9%), clothing stores (49%), electronics stores (23%) and office supply stores (41.2%).