It’s that time of year again – back-to-school. As some students cringe, parents are beginning to plan budgets on making sure their kids are ready for their next academic year. Back-to-school has turned into one of the largest shopping periods of the year, only beat by the holiday season. Average spending during this period has grown 42% in the past ten years1. This year, back-to-school shopping is expected to reach a total of $68 billion2. As consumers begin preparations, it’s important that businesses and their supply chains are ready to support the surge that the start of the school year brings.
Pens, Paper, and Much, Much More
Back-to-school shopping spans a large demographic. Millions of students, pre-school through college, will begin a new academic year in 2015. When surveyed, consumers planned on visiting department, discount, clothing, electronics, and office supply stores to make their purchases. Parents of students in kindergarten through their senior year in high school are estimated to spend about $630 dollars while a college student’s family is estimated to spend about $899 dollars. So what exactly are they buying?
In 2014, consumers spent more on electronics than any previous year so there is an expected decline in the amount they plan to spend this year3. However, fashion still leads as the most budgeted purchases this season.
Is Your Supply Chain Ready for the Test?
Businesses have to ensure that they have the inventory on-hand to support the surge both in-store and in their fulfillment centers. Many businesses begin running promotions as early as May to extend this prosperous period. Nearly 20% of shoppers start two months before the beginning of the school year. Consumers are shopping earlier since there is a wider variety of products that they need. Many note that it’s easier to disperse their budget when they don’t do all the shopping at once. However 30.2% shop one to two weeks before the first day of school4. Many think back-to-school products are just school supplies ranging from paper to writing utensils. However, there has been a growth in spending in apparel, shoes, electronics, and furniture during the school preparation season. The largest area of growth has been the number of college students who have reported that they will be living in a dorm room – setting a record high of 31%. This means an increase in room décor is likely as well. Businesses can prepare by ensuring that their stores are stocked and they plan shipments accordingly. Some may even choose to rent trailers to keep extra inventory on-site to easily fill shelves. Others may choose to lease additional warehouse space in urban hubs to easily reach consumers in a quick time period. Some retailers are even using their retail stores as position points for their in-store pick-up that appeals to college students moving further from home. For instance a student can go online, pick out all of their items, and have them shipped and waiting for them at the retail location closest to their school. These offerings enhance customer service and make move-in day a breeze.
Online Course: Managing Ecommerce
Although stores need to be cognitive of their inventory in-store, they should also be prepared for the surge of online shopping during this period. In 2014, 25% of back-to-school shoppers and 33% of college shoppers chose to shop online and this is only expected to grow this year5. Expectations for quick shipping and variety will bring consumers online to browse and complete more purchases than ever before. Shippers need to be sure that their operation is prepared to fulfill orders to ship to homes as well as to their stores since nearly half of consumers are planning to use ship to store options this year6. Correctly optimizing their supply chain networks can make these requests easier to execute.
As parents prepare their kids for the new school year, businesses will prepare their supply chain. Back-packs and school supplies will line end-caps of our local stores as the new school year brings in the start of fall. With thorough planning and flexible logistics partners, your supply chain can ace the back-to-school season, maximizing sales and keeping your customers happy.