Bad news for fans of Wal-Mart's layaway

[El Chuxter]

From AP via Yahoo News:

Wal-Mart Stores to cease layaway service

Wal-Mart Stores Inc. will end layaway service this year due to falling demand and rising costs, scrapping a tradition started when Sam Walton founded the chain in 1962 catering to cash-strapped rural shoppers in northwest Arkansas.

Wal-Mart said Thursday it will stop accepting layaway items Nov. 19 with a pickup deadline of mid-December. In its layaway program, customers make a down payment to hold an item and then generally had up to 60 days to pay it off, with a shorter deadline in the peak Christmas season.

Layaway services are used mainly by people at the lowest end of the income scale, who don't have credit cards and may not qualify for credit, analysts say.

The move comes as Wal-Mart is changing on many fronts, from adding upscale fashions to targeting new urban customers, in a bid to revive growth rates that have fallen behind smaller rivals such as Target Corp.

"Demand for layaway service has declined steadily as consumers turn to current options including online shopping, shopping cards and no-cost credit alternatives that were not available when the company was started," said Pat Curran, executive vice president of Wal-Mart store operations.

Analysts said most retailers have already dropped layaway service as it is expensive and cumbersome. Merchandise can be tied up for months and employees have to keep track of a steady trickle of payments.

One holdout is Kmart, a wholly owned subsidiary of Sears Holdings Corporation, which issued a statement Thursday stating that it continues to offer layaway services at its 1,300 stores.

"This is another recognition that Wal-Mart is no longer a little Ozarks company but instead is the nation's largest private employer and the world's largest retailer," said Patricia Edwards, portfolio manager and retail analyst at Wentworth, Hauser & Violich in Seattle, which manages $8.2 billion in assets and holds 51,000 Wal-Mart shares.

Still, Wal-Mart's union-backed critics said the move marked another step away from its founder's vision.

"Sam Walton's Wal-Mart — the one that 'bought American', treated workers with some dignity, and gave low income customers a chance to buy an expensive item over time — that Wal-Mart is now on permanent layaway," said Chris Kofinis, spokesman for WakeUpWalMart.com.

Sounds to me like a major case of someone shooting themselves in the foot. I know a lot of people who shop at WM over Target or other stores just because of the layaway program. Not to mention that people are more likely to make large purchases if they don't have to pay for everything upfront.

Stupid, if you ask me. Truly, truly stupid.

[Slicker]

It sounds to me like WM is trying to shed some of the more "undesirable" clients and clean up it's act and become a "higher" end store.



Poor, KH...

[CaptainSolo1138]

My wife mentioned to me today on my lunch that she was thinking about using lay-away at WM for the first time ever when she starts Christmas shopping, just to see if it's worth it at all. I guess that experiment is gonna have to wait.

Whatever is KH gonna do?!

[Jedi_Master_Guyute]

As a WM employee in the off season, i can say that i'm really happy with this news. You have no idea how much crap people put on layway and NEVER COME BACK for it. It slows down sales, takes up WAY too much room in the back and frankly, if you're putting it in layway due to money reasons, you probably should be putting your $$ into more important things. This is a great idea. Though, i'm going to miss walking back to the break room during the holidays and seeing those long lines of disgruntled shoppers who waited till the last effin' minute to get out their layways. Oh man, those were the days. Walking by on your way home and just seeing them so PO at the situation just made me grin.

[Kidhuman]

Sounds to me like a major case of someone shooting themselves in the foot. I know a lot of people who shop at WM over Target or other stores just because of the layaway program. Not to mention that people are more likely to make large purchases if they don't have to pay for everything upfront.

Stupid, if you ask me. Truly, truly stupid.

I am the same way. Not only do I use it for toys and such, but the wife uses it for household stuff as well. New bedding, curtains and so on...&

It sounds to me like WM is trying to shed some of the more "undesirable" clients and clean up it's act and become a "higher" end store.



Poor, KH...

Moneys money, dont matter if it comes from undesirables or not&

My wife mentioned to me today on my lunch that she was thinking about using lay-away at WM for the first time ever when she starts Christmas shopping, just to see if it's worth it at all. I guess that experiment is gonna have to wait.

It worked great at Christmas time becuase you had from mid Spet until mid Dec. to pay it off.

Whatever is KH gonna do?!

Kmart still has lay-a-way.

if you're putting it in layway due to money reasons, you probably should be putting your $$ into more important things.

So someone who can say afford to put down 100 dollars a week on a brand new TV doesnt deserve to get one? Some people dont like to fool with credit cards and such. This is by far the stupidest idea I have ever seen this company do. Its not just me talking, but alot of others too.

[LTBasker]

Moneys money, dont matter if it comes from undesirables or not

I've never understood the snootiness some people have towards those who use layaway. True, some people do abuse layaway and put in things they can't ever afford but the majority of people use it because it's something they can't afford right then.

It worked great at Christmas time becuase you had from mid Spet until mid Dec. to pay it off.

It's also used alot during the back to school season so parents don't have to clamor for supplies right when they go back and they don't have to have supplies sitting around the house for so long.

Kmart still has lay-a-way.

I hope your K-Mart has a decent layaway, the closest one here is depressing. You go into electronics and then go into a tiny corridor with low lighting where at the end is a small crappy counter with an employee at random times.
The last one I put in was a JL 10" figure and a few smaller things, to "store" it they put it all in a K-Mart bag and taped that.
The time before that it took 3 employees 45 minutes to figure out a new machine they got.

So someone who can say afford to put down 100 dollars a week on a brand new TV doesnt deserve to get one? Some people dont like to fool with credit cards and such. This is by far the stupidest idea I have ever seen this company do. Its not just me talking, but alot of others too.

Definitely, it's not only a service some depend on in general but here the employees mention that it's part of their largest profits during the holiday. People can put the highest costing items in layaway early in the season and pay it off while not having to hide it and having money for smaller things.

[2-1B]

I haven't used layaway in probably more than a decade.

[bobafrett]

I use lay away for times when I see the figures I want, but just don't have the money to get them that day. I think it's a bad plan, as I like to shop at Wal-Mart for my Star Wars fix, because of the Lay-Away.

They let us know at the morning meeting, and I immediatly thought of our man KH.

[JediTricks]

How come nobody can just put their money in the bank until they have enough to buy the item? I'm not trying to be a jerk about this, but clearly if they have the money within 3 months either way, why don't they just use the bank instead of layaway? (I am guilty of this as well, but that doesn't invalidate the question)

[Jedi_Master_Guyute]

How come nobody can just put their money in the bank until they have enough to buy the item? I'm not trying to be a jerk about this, but clearly if they have the money within 3 months either way, why don't they just use the bank instead of layaway? (I am guilty of this as well, but that doesn't invalidate the question)

exactly. Glad to see someobdy is sorta kinda on my side.