Oh how times have changed. Layaway is making a comeback!
Walmart, the worlds largest retailer, ceremoniously ended their layaway program in September of 2006, a move the smartest retailer in the world has to be re-evaluating at this very hour. K-Mart never suspended it's program and now, in fact, is heavily promoting layaway in it's 1380 stores.
The culprit? A dramatic downturn in the economy, but most importantly, a freeze on credit throughout every almost every industry.
Most are well-versed of the growing nightmare of home mortgage delinquencies, but few have paid attention to the staggering amount of personal credit card defaults which are rising at an alarming rate. This has made credit card-issuers highly-selective at a time of year when consumers are most likely looking to increase their credit lines, the holiday shopping season.
The solution, at some savvy retailers, seems to lie in having consumers start paying for those holiday purchases before the holidays, in stark contrast to the usual "No Money 'til January 2030" ads we see each November and December.
There may even be a move towards attempting to make layaway more mainstream.
In October of 2007 I came across this nugget on a business journal site I like to watch. Dieon Sanders, of Professional Football fame, was teaming up with a company that did not seem to fit the "branding" model of most pro athletes. The company? eLayaway, a company that offers layaway on items from over 250 merchant stores. They do not sell merchandise, they are primarily just the servicer of payments to those merchants. Using this model, I foresee a tremendous growth in the next 6-12 months in merchant membership, primarily because it could furnish anonymity to a participating merchant at the store level. A consumer could pay over time at eLayaway, then walk through the doors of say, Abercrombie and Fitch, to pick up their merchandise, all without any sign, within the store, of the transaction being consummated through layaway.
Don't expect to see this in your local Nordstrom, Sak's or Neiman's any time soon, but as more Americans come face to face with the reality of this economic crisis, look for layaway to, perhaps, take on a new persona, wide cultural acceptance.