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Brand Keys: Back-to-school sales to decline; Amazon and Wal-Mart strong

BY Dan Berthiaume

New York — Households with school-age children (pre-kindergarten through 12th grade) plan a big cut-back in back-to-school spending. Results of the 2013 Brand Keys Back to School Report Card show that there will be a year-over-year decrease of 10% in back-to-school spending, or an average spend this year of just more than $600 per household.

However, not every retailer will experience a decline in back-to-school profits. This year, the eight retailers showing the greatest increase in consumer intent-to-shop were:

1. Amazon
2. Wal-Mart
3. Target
4. Macy’s
5. Zappos
6. TJ Maxx / Kohl’s
7. Best Buy / Footlocker
8. Staples

Average anticipated spending in the major back-to-school categories are all down from last year. This includes:

  • Clothing: $301 (-29%)
  • Shoes: (athletic & dress) $110 (-23%)
  • Computers/Electronics/Tablets/Smartphones: $150 (-32%)
  • Supplies: $ 39 (-60%)
  • Books/Study Aids: $ 10 (-56%)

Looking at preferred retail categories for back-to-school spending, discount stores, online platforms and, secondarily, catalogs were the only categories to show any increase. Ninety-seven percent of households will shop at discount stores (up 4%), while 72% will shop online (up 34%), 28% will shop at department stores (down 44%), 25% will patronize office supply stores (down 55%), 30% will frequent specialty retailers (down 10%) and 35% will use catalogs (up 3%).

This year’s survey showed that 70% of consumers intend to wait until the middle-to-end of August period to shop just before schools open. The genesis of the shorter back-to-school purchase cycle is a consequence of increased levels of consumer expectations, according to Brand Keys analysis.

“Some of what we’re seeing reflects concerns of a slowing economic recovery, but the specific back-to-school figures also represent a shift in consumer buying habits,” said Robert Passikoff, Brand Keys founder and president. “Retailers may be running back-to-school ads right now, but they’ve been discounting and couponing for the past seven months. Educated consumers have already stockpiled supplies for the first day of school.”

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Post cereal parent company moves to expand brands portfolio

BY CSA STAFF

ST. LOUIS — Cereal maker Post Holdings has signed a definitive agreement to acquire Premier Nutrition, makers of the Joint Juice brand.

PNC is a rapidly growing marketer and distributor of premium protein beverages and foods under its Premier Protein brand and nutritional supplements under its Joint Juice brand.

"The acquisition provides Post a platform in the growing active nutrition and supplements businesses," Post stated in a release. "The PNC business will be independently managed by its experienced management team located in Emeryville, California. David Ritterbush, current CEO of PNC, will continue in that role."

Terms of the deal call for $180 million in cash to be paid at the time of closing, subject to a working capital adjustment, and Post anticipates completing the all-cash transaction by September 2013.

"We are excited to enter this high growth and dynamic category," said Bill Stiritz, Post chairman and CEO. "We could not be more impressed with the terrific quality of the Premier team Dave has put together."

Post Holdings is the parent company of Post Foods, LLC and Attune Foods, LLC. Post’s products are generally sold to supermarket chains, wholesalers, supercenters, club stores, mass merchandisers, distributors, convenience stores and the foodservice channel in North America.

Post’s portfolio of brands includes Honey Bunches of Oats, Pebbles, Great Grains, Post Shredded Wheat, Post Raisin Bran, Grape-Nuts and Honeycomb. With recent acquisitions, Post’s portfolio of brands now also includes Attune, Uncle Sam, Erewhon, Golden Temple, Peace Cereal, Sweet Home Farm and Willamette Valley Granola Company.

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Rue21 tries on new store format

BY CSA STAFF

WARRENDALE, Pa. — Rue21, a leading specialty apparel retailer for young women and men, is trying out a new store format on for size, and about to give guys something to smile about in the process.

The retailer has opened its first RueGuy stores in Bay Shore, N.Y., Harlingen, Texas, and New Boston, Ohio. The approximately 6,000-sq.-ft. stores are the first of seven RueGuy stores slated to open across the U.S. during August. The company is on target to open approximately 20 RueGuy stores by the end of the year.

The new store format features an expanded guys department and more selling space than a traditional rue21 store, providing its male consumers with a broader selection of product and new category opportunities.

The RueGuy stores have high ceilings, innovative signage, lighting elements and new fixtures that cater to the needs of male customers while complementing existing Rue21 stores and maintaining brand identity.

"We are extremely excited to announce the opening of our first RueGuy stores," said president and CEO Bob Fisch. "We look forward to growing our already successful guys business with this new store format that will allow us to deliver an expanded assortment of merchandise and accessories to our male customers. While we originally went into the design process focused on building the guys business, we are confident that the new store layout, colors and fixtures will improve the shopping experience for all of our customers who are seeking the latest trends at competitive starting price points. We see this as just the beginning of building a new store format for the future."

Rue21 currently operates 959 stores in 47 states.

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