National Retail Federation Expecting Consumer Spending Increase As Back To School Gets Underway
PITTSBURGH (KDKA) - If you are dragging your feet on your back to school shopping take heart, you are not alone.
The National Retail Federation says a lot of parents are holding back on getting everything their child needs.
Mark Mathews of the NRF says it's because they haven't gotten clear direction on what form their child's school year will take.
He says it's certainly not because of a lack of desire.
"Surprisingly we've had parents tell us they are planning to spend at record levels for back to school this year. Over a thousand dollars for kids going back to college and almost 800 dollars for kids going back to school."
Mathews says there's a COVID reason for the increase, "electronics is obviously the thing people are putting a lot of money towards. You have to understand that a lot of people expect to be schooling from home. So they need to set up a classroom at home. So its laptops but its also things like desks and chairs and a lot of spending on accessories like flash drives."
If you have been out clothes shopping for the new year it's hard not to notice all the elbow room you have in the stores.
"Interestingly enough we haven't seen a drop off in apparel spending plans," says Mathews. "When we asked, 93% said they were making apparel shopping up from 92% last year. So there are definitely people out there shopping."
But he adds, "We also know there's been an uptick in online purchasing, and maybe that explains a little bit of the lack of people going in the stores and the lack of comfort."
Mathews says the retailers are anxious to make up for the quarantine months, "I'd like to say its always a shoppers market there is so much competition in the retail space right now. There's so many players there are deals everywhere."
But beware the push for electronics and furniture are creating supply challenges so if those are on your must-have list he advises you not to wait too long.
For folks in the retail industry that's not a light at the end of the COVID tunnel but it's at least a glimmer.
"In the last two months, we've seen some year on year increases in retail sales. They were better months than 2019 so things are strong for the retail market at the moment. Obviously you would expect to see a rebound after a contraction like we had. So the real question going forward is can it be sustained?"
The problem according to Mathews is the pandemic has everything in flux.
"I think retailers are still trying to figure out what is going to work best. Are people going to come in the stores or online but you're definitely seeing a lot of promotional activity out there because we need to make up for those months when shopping was down."
While many retailers are starting the recovery process some didn't make it.
"We had about 25 retail bankruptcies last year and this year we've had about 43. So the numbers are up but in the grand scheme of things remember we have 4 million retail businesses in the US."
The pandemic certainly helped boost online sales.
Prior to COVID, online sales made up about 12% of retail sales. Mathews says the NRF numbers indicate that rose to 18-19% at the peak of the COVID lockdown and has now fallen back to about 15%.
Bottom line the retailers are hurting, they have stores stocked with merchandise they thought would have gone out the door by now so sales opportunities are out there.
