Many businesses have geared up for the back-to-school period. As parents prepare to equip their children with essential back-to-school supplies, the demand for various products surges, leading to strained supply chains. In this article, we’ll look at the effects of the back-to-school period, recent retail trends, and how to avoid getting caught up in Nightmare on Logistics Street.
Retail trends
The back-to-school period is characterised by distinct shifts in consumer behaviour, with one of the most significant trends being an increased reliance on discounts and promotions. Parents, faced with rising costs, are prioritising essential items and seeking out the best deals with which to manage their budgets. This was clearly the case in 2023, when consumer spending on back-to-school supplies in the UK surpassed £1.335 billion, driven by a heavy reliance on promotional offers.
Another interesting trend is a shift towards higher-quality products. Despite budget constraints, 73% of parents prefer to pay more for better-quality items that deliver longer-term value. This may help explain the rise in popularity of brands such as Marks & Spencer, Sainsbury’s and John Lewis, which are well-known for their higher-quality school supplies.
The adoption of payment schemes, such as buy-now-pay-later options, has also become increasingly popular, with 46% of parents using these schemes to spread the cost of their back-to-school shopping. Retailers have responded to this by highlighting savings options and promoting flexible payment methods to attract the budget-conscious.
Key segments in the back-to-school retail market
Although the back-to-school market covers a wide range of products, including stationery, accessories and books, the two largest product types by far in terms of consumer spending are uniforms and sportswear & sports equipment.
- Uniforms
Forming the primary segment, this encompasses a wide range of items including trousers, dresses & skirts, shirts & blouses, underwear, blazers & jackets, jumpers, footwear and accessories. ASDA leads the way as the most preferred retailer for these items, closely followed by Tesco. When it comes to shopping habits, parents predominantly shop for uniforms in high streets, town centres or shopping centres, with supermarkets being the top choice of store type.
- Sportswear & sports equipment
Love it or hate it, P.E. is a permanent fixture on the UK national curriculum, so sportswear is the other main segment of consumer spending. Within this category, Sports Direct is the top retailer in the category, with high streets and town centres again being favoured for purchases of activewear like trainers, shorts and T-shirts.
Predictions for this year’s period
Given the ongoing economic concerns, parents are likely to remain cautious with their spending. According to a Deloitte back-to-school survey, 44% of respondents are concerned about the economy and 47% said they have less money to spend. This leaning into price taking precedence over loyalty, with 67% saying they will shift brands if the preferred is expensive. That said, 85% of respondents stated they can be influenced by their children to “splurge on their must have back to school brands/products”.
The trend towards early shopping also looks like it’s going to continue, with the back-to-school season starting at the beginning of July and peaking in mid-July, coinciding with events like Amazon Prime Day. This early start lets parents spread out their expenses a little more evenly and take advantage of all the promotional offers they can get their hands on. Beyond this, omnichannel shopping is also expected to play a significant role, with parents using both online and physical stores to complete their back-to-school purchases.
How does this affect the logistics industry?
As retailers prepare for increased demand in school supplies, logistics providers need to make sure they’re set up for reliable, quick and flexible deliveries. The emphasis on early shopping means that retailers and logistics businesses need to be ready at a moment’s notice to smoothly handle any influx of orders.
The omnichannel shopping trend adds another layer of complexity to logistics operations, requiring efficient systems that integrate both online and offline sales channels. Integrating all channels ensures that inventory levels are accurately reflected across every platform, preventing stockouts and overselling.
The 4PL solution
Fourth-party logistics (4PL) providers like X2 (UK) offer perhaps the most effective and convenient solution to the supply chain issues that come with the back-to-school period. From managing the entire supply chain from sourcing to delivery to assisting on an ad-hoc basis as and when needed, X2 (UK) delivers a dependable all-in-one service that leaves retailers free to concentrate on keeping their customers happy.
A key advantage is our ability to integrate and coordinate multiple logistics services under one roof. This integration keeps operations smooth across all channels, allowing for accurate inventory management and efficient order fulfillment.
Adding Just-in-Time to the back-to-school curriculum
JIT focuses on delivering goods only as and when they are needed, minimising inventory and warehousing costs, and reducing waste.
As unpredictable as the demand surges during the back-to-school period can be, through our years of experience, insights gained from closely working with a large partner network and demand forecasting to predict these fluctuations accurately, we work closely with retailers operating a JIT approach – aligning our extensive geographical coverage, vehicle types and availability with the response time needed to transport goods on a JIT basis.
In addition to demand forecasting, 4PL providers offer powerful vendor management solutions that streamline communication and collaboration with suppliers. This improved coordination means that suppliers can respond quickly to changing demand, further supporting the JIT inventory approach.
With 4PLs like X2 (UK) using a control tower methodology, their real-time tracking and monitoring systems provide continuous updates on shipment status, allowing retailers to track their inventory throughout the entire supply chain. This visibility lets retailers identify potential bottlenecks or delays and take corrective actions quickly, making sure that no one gets caught short.
Ultimately, JIT inventory management allows retailers to meet customer demands reliably and cost-effectively, boosting their reputation as a trusted choice for parents. While the technology needed to make JIT work dependably can be complex and technical, the outcome it delivers is remarkably simple – the exact stock you need, when you need it.
To find out more about X2 (UK) and how we can keep your retail business firing on all cylinders during the back-to-school period, you can contact us here.