Layaway programs make a comeback

By ELISE FRANCO

Vindicator staff writer

Layaway is making consumer spending more manageable this holiday shopping season.

Retail stores such as Sears, TJ Maxx, Toys ’R Us and Kmart are using layaway programs to draw in shoppers often and early.

Katie Reczek, Toys ’R Us corporate spokeswoman, said the store implemented a layaway program for the first time in October. Reczek said shoppers can use the service for big-ticket items such as video game consoles, bikes, doll houses, strollers and play kitchens.

“We certainly understand that folks are looking to make important holiday purchases early in the shopping season,” she said. “You can then have the peace of mind that you’ve purchased that item.”

Reczek said customers must put down 20 percent of the item’s cost along with a $10 service charge. She said payments may be made at the store at any time in the form of cash, check, credit, debit or gift card.

Another store that has always pushed the layaway option is Kmart on Boardman-Poland Road in Boardman. Store manager Patrick Hughes said Kmart is one of the only retailers that has never strayed from layaway.

Hughes said his store has had an estimated 40 percent increase in layaway use in the past two years.

“Last year and this year we had a

really good response,” he said. “Because of the economy people are having a hard time getting credit, so layaway is a good asset for customers to have.”

Hughes said Kmart shoppers are required to pay 10 percent of the item’s cost and a $5 service charge up front. He said any non-clearance item in the store can be put into layaway, and customers have 60 days to pay off the purchase.

“I expect we’ll do even better than last year,” he said. “The customers do appreciate the layaway, so it has really helped us as a store.”

Retail giant Target, however, has no immediate plans to begin a layaway program, said Dawn Koehn, human resources manager at Target in Niles.

Koehn said for Targets, the benefits of layaway are outweighed by other factors such as how much space and manpower it takes to run the actual department compared to how many customers use the service.

“Layaway isn’t really a productive thing for us from the business standpoint,” she said. “The majority of consumers do not pick up their layaways.”

Koehn said the lack of layaway hasn’t deterred consumers from shopping at Target, however.

“We have the advantage because we offer a lot of everyday things as well as [clothes and toys,]” she said. “Our commodities are definitely sustaining in those areas.”

Though stores’ opinions on layaway differ, they could all agree that driving sales is what is most important.

“We definitely have felt a dip this year, but Target has done a great job of planning accordingly,” Koehn said. “The last couple weeks have been great heading into the holiday season, and we’ve already seen an increase in sales goals. We’re expecting them to go above last year.”

Hughes said he’s seen a different customer base over the past year.

“Spending trends are about the same, but we’ve had a lot of new customers,” he said. “There are a lot of people who haven’t shopped here for a while who have come back.”

Reczek said Toys ’ R Us customers have also been steady in their spending.

“We have seen a little bit of resistance to big items,” she said. “That being said, toys are not that expensive to begin with, and they will always sell ... The last thing parents will cut back on during the holidays are toys for their kids.”

efranco@vindy.com

Holiday shopping

Layaway

Many retail stores are offering layaway programs to help customers manage their shopping this holiday season. Toys ‘R Us is trying the service for the first time ever this year, and Sears brought layaway back after not offering it for many years.

Kmart: Customers must pay 10 percent of the total purchase and a $5 service fee. Payments can be made weekly, and purchases will be held for 60 days.

Toys ‘R Us: Customers must pay 20 percent of the total purchase and a $10 service fee. Payments can be made in-store at any time, and purchases must be picked up by Dec. 6.

Sears: Customers must pay $15 or 20 percent of the total purchase, whichever is greater, and a $5 service fee. Payments can then be made over an eight-week period.

TJ Maxx: Customers must pay 10 percent of the total purchase and a $5 service fee. All purchases must be paid in full within 30 days.

Burlington Coat Factory: Customers must pay 20 percent of the total purchase and a $5 service fee. A second payment of 20 percent must be made within 14 days. All purchases must be paid in full within 60 days.

Source: Layaway policies from Burlington Coat Factory, Sears, TJ Maxx, Kmart and Toys ‘R Us.