NEW YORK (CNN/Money) -
While most kids probably aren't counting down the days to that first school bell, the nation's retailers can't wait to hear it soon enough.
After a so-so summer of sales, retailers are hoping to lift their fortunes with a back-to-school buying bonanza.
Consumers are expected to spend a total of $14.8 billion on merchandise for kids -- everything from clothes, electronics, shoes, bags and notebooks.
According to the National Retail Federation (NRF), the industry's largest trade group, families with school-going children will spend just over 7 percent more this year on school-related goods than the previous year.
Despite the NRF's bullish forecast, analysts say retailers are up against pretty tough comparisons a year ago.
"We're already seeing heavy markdowns particularly in apparel," said Richard Hastings, retail sector analyst with Bernard Sand, adding that the price slashing could ultimately cut into sales forecast for the period.
Prepping the look
Low-priced chains, department stores and teen specialty apparel chains are typically the big gainers during this season, say analysts.
Discounters such as Wal-Mart and Target are expected to garner about 76 percent of the back-to-school shoppers, with department stores getting 42 percent, according to the NRF.
Sellers of school supplies such as OfficeMax and Staples could get about 35 percent of consumers.
"Discounters and apparel are the heart and soul of this period simply because there are so many kids today that are going to school," said George Whalin, an independent retail analyst. Both Wal-Mart (WMT: Research, Estimates) and Target (TGT: Research, Estimates), and other value-priced chains like Kohl's are popular with bargain shoppers."
Retail observers say a few specialty apparel chains also appear well-positioned to take advantage of this year's back-to-school fashion trends that are heavy on the "preppy" and "classic" looks.
That's a positive for specialty chains such as Aeropostale (ARO: Research, Estimates), American Eagle Outfitters (AEOS: Research, Estimates) and Abercrombie & Fitch (ANF: Research, Estimates) but a potential negative for the basic, surf and punk-inspired lines of Hot Topic (HOTT: Research, Estimates), Wet Seal (WTSLA: Research, Estimates) and Pacific Sunwear (PSUN: Research, Estimates), according to Todd Slater, analyst with Lazard Freres.
"American Eagle has refocused back on the 18 year-old customer featuring preppy fashions emphasizing denims, skirts and polos," Slater wrote in a research note Monday.
Slater was less enthusiastic on the Gap (GPS: Research, Estimates), saying that "early back-to-school merchandise seems very basic. In women's, the merchandise looked a little stale," he said.
Grading the gadgets
Personal computers, MP3 players, digital cameras have all become a critical component of a student's back-to-school survival gear. And industry watchers are already predicting consumers electronics retailers to come out as winners.
Back-to-school is the second biggest season for the industry after Christmas for electronics sales, said Steve Baker, director of industry analysis at market research firm NPD Group.
"So far the trends are in sync with the requirements of the season. The hot sellers are products that are smaller, more portable and easier to handle," he said.
Among his picks for the "must have" items: MP3 players and notebook computers. He also expects smaller size LCD TVs and digital cameras to be popular purchases for dormitory living.
Electronics retailers could also benefit from selling at full prices, Baker said, since the back-to-school shopper isn't very price sensitive. "In most cases, these are products that people really need and they have a finite period of time in which to acquire them. So expect prices to be firm."
Even though he's bullish on the season, Baker suspects that retailers could still be challenged to match last year's stellar numbers. According to NPD, electronic sales in the third-quarter of 2003 were $7.8 billion, up from $7 billion in 2002.
"Sales in the first-half of this year have been pretty strong. But one of the biggest issues is the tough year-over-year comparisons," Baker said.
Best Buy (BBY: Research, Estimates), the No. 1 electronics retailer, is touting wireless technology and online music downloading for the school-going crowd.
"Wireless technology for laptops is huge especially as many colleges now offer WiFi access," said Brian Lucas, spokesman for Best Buy. "We're also promoting digital entertainment systems, iPods and legal downloading of music from our partner Napster. That way students don't have to take their entire CD collection to school with them."
Meanwhile, rival Circuit City (CC: Research, Estimates), the No. 2 purveyor of gadgets and gizmos, has introduced a school "check-list" to ensure students arrive on campus with all the gear that they need.
The list includes school with all the gear they need. Besides the desktop TV, DVD player and stereo systems, it also includes some important but sometimes forgettable items that such as ink cartridges, Ethernet cards and surge protectors.