Worst Performance Ever For Back-To-School Sales

There are two things retailers thought they could always count on, a robust Christmas shopping season and strong back-to-school sales. However, the Christmas fairy tale shattered last year and back-to-school sales are in the midst of their first ever collapse this year.

Inquiring minds are reading Retailers See Back-to-School Sales Slowing.

Halfway through the back-to-school shopping season, retail professionals are predicting the worst performance for stores in more than a decade, yet another sign that consumers are clinging to every dollar.

Stock analysts at Citigroup are predicting a decline in back-to-school sales for the first time since they began tracking the figures in 1995. They estimate August and September sales at stores open for at least a year — known as same-store sales — will fall 3 to 4 percent, compared with an increase of nearly 1 percent in the same period last year.

The National Retail Federation, an industry group, expects the average family with school-age children to spend nearly 8 percent less this year than last. And ShopperTrak, a research company, predicted customer traffic would be down 10 percent from a year ago.

“This is going to be the worst back-to-school season in many, many years,” said Craig F. Johnson, president of Customer Growth Partners, a retailing consultant firm.

This year’s frugality may hark back to an earlier age, but consumers are using up-to-the-minute tools in their determination to save money. They are scouring the Internet for coupons. They are planning their shopping trips around e-mail alerts that tip them to bargains.

One mother, Clarissa Nassar, signed up for alerts about sales on a Web site called Shop It To Me. When she saw that her daughter’s favorite brand, Baby Phat, was on sale at Macy’s, she promptly drove to the department store to shop for school clothes.

“I got an alert for the cutest tie-dye pink top,” said Ms. Nassar, a mother of two, Mikayla, 7, and Joseph, 3, in Johnstown, N.Y. “Originally it was $36 and I got it for $9.75.”

Executives at Google said Internet searches for back-to-school bargains had soared this year. Searches for coupons are up 40 percent over last year and searches for buy-one-get-one-free deals are up 30 percent.

The article notes that Staples lowered prices on 250 back-to-school items in an attempt to compete with Walmart. With that, we can safely add Staples to the ever growing list of Peas In The Deflationary Pod.

In a flashback to the past, coupon sales are soaring. Anyone remember their parents clipping coupons? Except perhaps for huge discounts, how many routinely did it 3 years ago, two years ago?

Some thought last season's Christmas sales were bad. This year is going to be a disaster.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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