Back to the Past

It's been said that hard times breed creativity. When people have to figure out a way to get by -- or else -- they somehow manage to come up with solutions to all sorts of problems.

As it happens, one of the innovative methods that some retailers used to stay afloat during the Great Depression was to offer customers -- who otherwise had no access to cash or credit -- a relatively low-risk (for the vendor, at least) way to shop, known as layaway.

Given the growing number of other parallels to that era we've been hearing about lately, is it any surprise, as the Chicago Sun-Times reports, that "Layaway Is Back"?

SHOPPING: With economy teetering, consumers opt to buy items a bit at a time

Ina Cruse was excited about her latest find at the State Street TJ Maxx -- a basketful of fancy Italian-made bath products at about eight bucks each. The same brand sells for about $20 in other stores.

Easy Christmas gifts, figured the retired retail worker, rushing the basket to the cashier. The damage that trip: Less than 10 bucks.

No, she didn't find some super-duper sale. Or use buy-one-get-30-free coupons.

She's among the growing number of shoppers retailers see using layaway programs, the Great Depression-born retail tool that allows customer to make incremental payments on items over a period of time before taking them home.

Buying for holidays

The programs, usually relegated to the backs or service departments of stores, had appealed to less-affluent shoppers and those without credit cards, and fell out of favor decades ago.

Now, more shoppers are putting items in layaway, prompted by credit tightening -- a need to grab products while they're on sale and the desire to avoid interest on purchases.

For Cruse, layaway lines are old hat. She has been in and out of them for about 25 years, but finds herself at layaway departments more frequently these days.

Her daughter is pregnant with twins, Cruse's first grandchildren. And Cruse is buying items in anticipation of their Christmas Eve due date.

"I've been using it a lot the last three or four weeks. I've been doing a lot of layaway for the babies," she said. "I'm on a fixed income. I can't just whip out charge cards every time you turn around."

Kmart has seen in increase in layaway business this year, with an influx of new layaway program users, said Tom Aiello, of Hoffman Estates-based Kmart parent Sears Holdings Corp.

The company started aggressively promoting the program last month, anticipating shoppers would be cash-and/or credit-strapped. The chain, which has layaway at most of its stores, gives customers a whopping eight weeks to pay off purchases. The standard is 30 days.

Provides options

Layaway sales are up 2.5 percent at Burlington Coat Factory Warehouse, a spokeswoman said.

The practice even has extended into the World Wide Web. The sites eLayaway.com and Lay-away.com allow customers to pay for merchandise over time before it's sent.

Kmart continued to offer layaway even as competitors Wal-Mart and Target abandoned their programs in 2006 when credit was easier to get.

"We were planning for the holiday season and knew the economy was going to be rough," Aiello said, adding that customers wanted to buy early and manage budgets.

Its use can ensure an item is held for a shopper at one store while they look for a more fitting version -- in a preferred color or size -- at another. It also allows customers to take advantage of sales on items even when their pockets are light, Cruse said.

"That merchandise comes in when they're getting ready for Christmas, and you might not be able to get it a month from now," she said.

Comments

[sackerson]

It's how my mother-in-law used to buy things for the house.

[donny]

Layaway at Walmart sounds kind of risky, even with sales prices. What about deflation? Even during credit expansion, prices went down on a lot of big ticket items. At other stores you risk the store going bankrupt. Universal layaway plans (bank accounts) are at least protected by the government. If you don't trust yourself with the money--well, sorry, we're just all going to have to learn to stop being such freaking maniacs with our money.