"As part of our planning process this year, we set up focus groups," said Tom Aiello, vice-president for public relations for Sears Holdings. "They told us customers want to shop earlier this year, and manage their budgets better. They said they wanted layaway."
Kmart's layaway program requires customers to put 10 percent down, and over an eight-week period, to make equal payments every two weeks until the merchandise is paid off.
"If you can't make a payment, there is a seven-day grace period," Mr. Aiello said. "If the layaway is cancelled, we offer a full refund, but there is a $10 cancellation fee. It could be for tools, toys, apparel or home electronics."
One benefit of layaway is that the customer does not have to worry about paying off credit cards from holiday shopping in the new year, he said.
Kmart's layaway program has helped boost sales, Mr. Aiello said.
"This is the first time we advertised layaway at Kmart," he said. "We started it at Sears, literally, two weeks ago. We've gotten feedback from store managers and associates that they've had a lot of requests from consumers for layaway. So, we rolled up our sleeves, and, fortunately, we still have the infrastructure in place. We launched it on the (November) 16th."
Sears' layaway program is a little different -- customers have to put down 20 percent. The $5 fee is there, but there's no regular payment plan -- just pay it off on or before Dec. 23
"We are reading and hearing retailers, with sales dropping, will do anything to entice the consumer to spend some money," said Mr. Aiello. "It's a good way to add some discipline to the purchase. It's like paying with cash. You only spend what you have. That's why it's so popular."
At TJ Maxx and Marshalls department stores, which are both owned by TJX, layaway is offered only at select stores, said Annmarie Farretta, a spokeswoman for TJX.
"TJ Maxx is always assessing and reviewing ways to improve customer service, and in-store experience," she said. "We are offering layaway on a 30-day purchase and pay basis. We require a $10 deposit, and a retail fee which is typically $5."
Merchandise must be picked up and paid for within 30 days and jewelry and clearance items cannot be placed on layaway, she added.
Some other area retailers, including Wal-Mart and Target, have no plans to offer layaway because it is too expensive for the stores and could cause prices to rise.
"We are looking, every day, to keep our costs as low as possible," said Steven Linders, a spokesman for Target. "We are focusing on delivering the best value to our customers day in, day out."
Contact the writer: jdino@standardspeaker.com
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