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Back-To-School – revenue growth, despite delayed sales

Back-to-school’ has shown growth, due to price increases and despite a drop in larger packs.

This years’ Back-To-School (BTS) extravaganza has perhaps not been quite so extravagant, according to our snapshot look at the Writing category in our Weekly tracker – but it is showing growth.

Sales appear to have been left to the last minute, with weeks 35 and 36 (straddling September) both remaining the key active time for parents to fill those school bags. However, these weeks did not attain the same lofty heights in sales terms as they did in 2017, leaving us with some unseasonal summer blues over this typically strong sales period.

Why? I hear you ask. If we look at weeks 29-38 this year compared to last year, the topline figure of +2.3% growth in value does appear pretty positive. However, the driver behind this is down to price increases. Average prices across the Writing segment of the stationery market have grown 5.8% over the same time period, which appears to be aligned to wider economic trends observed this year.

The knock-on effect of this is that smaller pack sizes are winning out, and we see lower sales for large pack products like colouring pencils and colouring felt pens, writing felt pens and markers which are carrying higher price points. Each of these categories has really struggled for growth, with the volume of market sales declining 3.1%.

However, let’s not be too glum from this one snapshot from our weekly indicator – because there is bright news, including within this Writing category of stationery.

Traditional categories like Ballpoint pens, Correction Products and Highlighters are all in growth. The fact that these categories include price increases (for example – a standard 10 pack of ballpoint pens is on average 7% more expensive this year than last) shows that traditional stationery is still important for schooling, despite indications that more children may well be using digital means to support their educational development.

Looking at writing instruments, a noteworthy trend is the continued sales of stationery or writing sets. Stationery sets are seemingly a reasonable choice for savvy and budget-conscious parents who are looking to buy multiple items in one go. With a large number of these sets released in early July (around 200) it seems that offers that make it easier for parents to find and buy the various products that are required by their children for school is going to be the goal-post by which BTS is now measured.

In conclusion: while this year’s sales paints a picture of a more subdued BTS than before, there is growth, and there are clear areas where the industry can focus on continuing to deliver value and overall revenue to the category.

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