Layaway has changed significantly since its debut during the Great Depression. Fundamentally, the premise is still the same (make payments over time, then receive the item once paid in full) but we bet there are a few things you never knew about layaway or didn’t even think to consider! Throughout this blog, we will address the most common layaway misconceptions and what you should consider when offering layaway to your customers. So, throw your traditional notions of layaway to the wind and let one of eLayaway’s Layaway Experts show you how it’s done!
Top 3 Misconceptions:
Misconception 1: Layaway is Dead, Credit is King – …, the 80’s…What a wonderful time of grandeur and frivolity… Who knew that the decade would go from a Flock of Seagulls to a flock of debt (maybe debt was what they were running from). Anyway, we all know how credit cards work. Heck, half of us reading this are probably paying off a credit card (or two… or five). In fact, according to myFICO®, nearly 37% of Americans carry more than $10,000 of non mortgage-related debt. If that figure does not get your attention, realize that the average American will pay $600,000 in interest over the course of their lifetime. It’s no wonder why consumers are turning to a more responsible, debt-free way to pay. Customers now-a-days are looking for an easy way to get the things they want without breaking the bank. A recent study conducted by eLayaway found that 95% of the consumers surveyed said they would be more likely to make a purchase, given layaway was provided as a payment option.
Misconception 2: Layaway is for the Poor – Sure, layaway was born from hard times and over the decades may have become synonymous with not having money but over the last few years (and due mainly to the economy), Layaway has evolved into a smart, fiscally-responsible and affordable payment option for everyone. When the easy-credit-for-all phase died, layaway returned with a modernized spin and a changed demographic. Layaway is not just for people that have no other means to afford a purchase; it’s for people who want to manage their finances responsibly. More and more, even those with disposable income are choosing layaway as a planning tool many of their purchases. Currently, over 23% of traffic to eLayaway.com is from consumers with household incomes above $100,000, an additional 42% is above $60,000. According to a recent survey conducted by comScore®, “76% of consumers have changed how they spend money based on the recession and 43% of them say these changes are permanent.” Lesson learned!
Misconception 3: Layaway Programs are Costly to the Business Owner – Back in the day, layaway programs were costly to administer. Business owners were faced with the predicament of storing items that had not yet been paid for, while bookkeeping was its own debacle. Many layaway departments were managed autonomously in order to simplify operations while others were tracked using index cards (we’ve seen it all). While every merchant wants nothing less than to sell more and keep costs to a minimum, layaway was a double-edged sword that although increased sales, came with its own set of challenges. In order for the layaway process to survive, it was in need of a modern solution; one that automated the process for merchants and consumers while alleviating the inventory and administrative headache. Enter eLayaway… your layaway department!
As the Internets only layaway payment processor, eLayaway has created a turn-key solution that offers all of the tools needed to implement, run and manage your business’s “Layaway department”. Gone are the days where you are required to hold merchandise and dust it off once fully paid. eLayaway provides the flexibility to customize a layaway plan that can fit any size business – without cutting into your bottom line. eLayaway works for both online stores and brick & mortar, plus it comes pre-integrated in your 3dCart Shopping Cart Software! (OK, let me stop selling and get back to teaching you about layaway – lots of great information follows
Is Layaway Right For You?
The short answer: Yes
The long answer: Yeeeeeeeeeeeees!
Layaway simply offers your customers with the option to pay over time. It’s no different than someone saving for their purchase, except that the sale already belongs to you. In its traditional form, layaway doesn’t work for every purchase. Automated layaway payment programs, like eLayaway (OK, that’s the last plug, I promise), make it easy and affordable to open your own layaway department. Following are some of the benefits to offering layaway.
Become A Weatherman For Your Sales (Ugly Tie Not Included). Layaway plans can be a useful tool to forecast future sales while gaining valuable insight to the purchase patterns of your customers. The best part is that you do not need a degree in meteorology to accomplish this! When you know more about the future sales of your busines
As, you can make a more informed choice when it comes to supply and demand. Understanding what the needs of your customer’s will be in the future and the patterns of which they spend can be invaluable to a business owner. Now, that’s science!
Did You Just Ask if You Can Put a Coffin on Layaway? We once had a customer ask us to put a coffin and burial plot for her on layaway. At first, I felt kind of bad asking her what her desired length of her payment would be; wondering if it was a time sensitive matter (Imagine asking, “So, is 6 months enough time or do you plan on dying sooner?”). Quickly, we began to realize that virtually anything can be put on layaway these days. Many doctors use layaway as a means to accept payment for elective procedures. Professional sports teams are utilizing layaway to fill their otherwise empty seats. While travel agents are capitalizing on the already pre-planned nature of vacationing. Think that’s where it ends? Guess again. The possibilities are endless.
When Opportunity Knocks… Open the door! Layaway plans can mean the difference between increasing sales or watching that customer walk back out the door (or click to another page in the case of an online store). Credit-challenged consumers or those choosing to be more fiscally responsible still have wants and needs. Layaway provides the opportunity to capitalize on that simple fact. Without a layaway option, you are literally turning down customers. In keeping with the theme that the main objective of a business is to make money, does it really make sense to discriminate money that was derived from a layaway plan? You decide.
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About the Author:
Melissa Valido is one of eLayaway’s marketing experts and resident bloggers. She works directly with both consumers and merchants to better understand the needs and motives of eLayaway’s market and to ensure that future iterations of the process meet those needs.