Back-to-school blues expected to end for retailers

Press Release:

2010 Season's Sales Forecast up 5.4%

NEW YORK (July 15, 2010) – With the 2009-2010 academic year having recently ended for some 76 million children and adults enrolled in the nation's nursery schools through colleges, retailers are already looking ahead to the Back-to-School (BTS) spending season which typically gets under way in mid July and runs through mid September. While the last two BTS seasons have been tough for the retail industry, the International Council of shopping Centers (ICSC) is forecasting an increase of 5.4% for this season's sales.

The U.S. Commerce Department has segmented retail sales categories that are important for BTS purchases, which are family clothing, shoes, electronics, and books. Sales at these stores collectively declined by 2.8% in 2009 and 0.4% in 2008 over the July-August-September period (see table 1 below). July BTS sales were particularly weak in 2009 dropping 5.9%.

"Based on arithmetic alone, the expected July jump in BTS spending could be extremely strong," said Michael P. Niemira, chief economist and director of research for ICSC. "Layer on some fundamental improvement in the consumer economy, including some pickup in the pace of earnings growth, and we should see a strong 7.6% rise for July, continued strength in August with a 5.7% increase, and a moderate 3.0% rise in September for BTS spending. Overall we are projecting BTS season sales to increase by a solid 5.4%, potentially the strongest showing since 2005 (+6.4%)," added Niemira.

By category, family clothing is likely to show the strongest spurt with a 6.5% increase. Electronics and shoes will not be far behind, with each forecasted to post a solid 5.0% gain for the 2010 BTS season.