Laura Rowley Money & Happiness

It feels like my kids just got out of school, maybe because June was a wash, literally, with record rainfall in parts of the Northeast.

But we're already halfway through the summer, and my mailbox (and junk email box) is filling up with back-to-school flyers and promotions from retailers, desperate for a little action from tight-fisted consumers. With fierce competition among big-box discounters, drugstore chains, dollar stores and office supply retailers, a little planning can save you plenty on your back-to-school budget.

The average family is expected to spend about $550 on K-through-8 back-to-school purchases, down nearly 8 percent from last year, according to the National Retail Federation's annual survey. For households with college students the figure is about $620, up 3 percent. Overall, the NRF expects spending to total $47.5 billion.

The survey found half of shoppers plan to cut overall spending; 56 percent are hunting for sales more often; 42 percent buying generic or store brands; and 40 percent are using coupons (aided by the ease of online searches).

"The big difference this year is that before heading out the door, families will find the best deal around town -- whether it's doing comparative shopping online or with (printed) circulars," says NRF spokesperson Kathy Grannis. "Back when the economy was healthy it was more popular to head to your favorite store. But with the focus on price these days, it's essential for families to pinch pennies and get everything they need within a specific budget." That budgeting is extending to big expenses: The NRF found the number of college-bound students who will be living at home rather than in a dorm rose 5 percent.

Where and When to Shop

While discount stores remain the most popular shopping destination, with 75 percent of consumers heading to big-box retailers, 21.5 percent say they'll check out local drugstores, which have broadened their merchandise mix in recent years. That may be a mistake. A recent report from Consumer Reports ShopSmart magazine found drugstore CVS charged up to three times more for the same items as discount and dollar stores (although the report didn't compare quality).
 
Meanwhile, office supply stores are rolling out early-bird promotions. Staples, for example, reduced prices on 250 school supplies starting in mid-July and will offer weekly penny and dollar specials.

"The office supply stores have been trying to grab more market share of back-to-school for five to seven years," says Britt Beemer, chairman and founder of Charleston, S.C.-based America's Research Group. "Even though they're doing better they still get a small share. Getting the consumer in the door is the single biggest challenge, so if you come in to buy scissors for a penny you may find other items you need."

On the other hand, Beemer has tracked a huge jump in the numbers of consumers who buy the promotional deal and walk out. Some 90 percent of respondents surveyed on their July 4th shopping did just that. "Three years ago, 80 percent would have looked around the store and bought something else," he says.  "I think browsing is dead for a while."

If you go the office supply route, sign up for the store's loyalty card to receive their coupons by email.

Another option: Split costs at a warehouse club. I share my huge containers of produce with a friend -- it may make sense to do the same with pens, pencils, highlighters and the like. And keep an eye out for random deals. I scored sturdy new backpacks for the kids at my local Costco for $14.99 each in early July, about half price.

Beemer advises bargain shoppers to wait until the bitter end, as long as they don't mind a narrower selection. "I think back-to-school is going to be weak, so there will be an awful lot of merchandise left come Labor Day," he says. "If the retailers haven't sold it by then they'll be desperate to get rid of it; the weekend after Labor Day may be when you get the lowest prices, although the selection will be so picked over, so you may not have many choices."
 
Saving on Clothing and More

Before you dive into back-to-school clothing, take inventory of your child's closet and make a list of needs. Beemer says almost two-thirds of consumers now shop with a list to stay on budget. Fortunately, kids fashion trends favor a frugal approach -- faded skinny jeans, leggings, soft plaid shirts, graphic tees, distressed leather jackets, scarves and messenger bags can easily be found in Goodwill, Army/Navy stores or consignment shops. (Two of my kids go to private school, where parent-volunteers maintain a "uniform exchange" closet, so parents can trade for free.)

Thrift and consignment stores "are picking up 2 to 4 points of market share over last year," says Beemer. "There's no question they've become more popular. At one time they were getting 6 to 8 percent market share in some categories -- now it's between 10 and 12 percent, especially in 'disposable' clothing. If children are growing fast they may only need an item for six to seven months before they've outgrown it."

Environmentalism and eBay popularized the acceptance of buying used, says Beemer, who scored a $350 pair of barely worn Allen Edmond shoes for $59 on the website ("the sole wasn't even dirty on the bottom," he says). Sites like craigslist.com and freecycle.org have upped the ante. And necessity may be the mother of vintage fashion. "If you have less to spend -- and 38 percent of people say they are concerned about their jobs -- you become a little more humble," says Beemer.
 
If you're heading for a department store, always ask if there's a coupon behind the counter. Beemer's research finds 72 percent of Americans are negotiating lower prices when shopping in stores. If you shop online, sign up for a site like eBates to get 5 percent back on your purchase.

Also check out a recent promotion by PayPal, which has aligned with merchants like American Eagle Outfitters, Nike and Dell to offer 40 percent with free shipping on certain items through Aug. 24 if the shopper pays using the service.

For more back-to-school savings ideas, see my blog.