colorful school supplies

A Back-to-School Shopping Season Like No Other

Companies Pivot as School Districts Announce Plans for Continued Remote Learning

When retail stores across the country closed in the spring, many companies pegged their hopes on a busy summer and back-to-school shopping season. However, many school districts across the country are announcing plans to only partially reopen, or are deciding to stick to remote learning until COVID-19 cases fall.

The late-summer rush for clothes and school supplies is typically the second-biggest season for retailers after the holidays. It often serves as a predictor for how stores will perform in November and December. Though this back-to-school season is different, retailers are finding creative ways to cater to kids’ and parents’ needs.

Masks, Leggings, and Laptops

American Eagle Outfitters (AEO) is pivoting from selling clothes for the classroom to selling clothes for the couch like leggings and sweatshirts. Staples Inc. and JCPenney (JCP) are promoting sales of masks and other protective equipment as part of their back to school offerings.

Bed Bath & Beyond (BBBY) usually sees a rush of college students buying dorm room supplies, but is cutting prices in hopes of gaining customers—even though many college students will be studying at home in the fall. Macy’s (M), which also caters to dorm room decorators, is encouraging young customers to decorate their bedrooms at home instead.

One bright spot for the back to school season could be electronics. Because students may be doing much of their learning remotely this year, sales of low-price, durable laptops have been surging. Chrome books, made by Google (GOOGL), are particularly popular for K-12 students. Sales of the laptops were up 34% year-over-year during the second quarter.

An Uncertain Future

The National Retail Federation predicts that sales of electronics will push spending by parents of elementary through college students to $101.6 billion this year—up from $80.7 billion last year. On the other hand, predictions from GlobalData PLC predict a 37.8% drop in back-to-school spending this year.

The difference in these forecasts shows that investors are having a difficult time knowing what to expect from this unprecedented back-to-school shopping season.

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