Nov 11, 2008 8:18 am US/Eastern
Layaway Plans Make Comeback This Holiday Season
Many Businesses In Our Area Bring Back Practice Made Popular During Tough Times Of Great Depression
NEW YORK (CBS) ―
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Early shoppers wait online to pay for their goods at the Toys 'R' Us at Times Square Nov. 23, 2007 in New York City.
Hiroko Masuike/Getty Images
Amid the continuing credit crisis credit card companies are tightening limits and offering fewer promotions.
In response, retailers say consumers are shopping for the holidays the old fashioned way.
Want to buy a bike for your kid for Christmas but don't have enough cash on hand today? How about putting it on layaway?
"Just some Christmas toys, a camera, Scrabble board games," said Ailel Rodriguez of the Bronx. "We'll usually do it for bags. We'll put down a certain amount and in a matter of two or three weeks, we'll get it."
Layaway plans are making a huge comeback. More merchants say customers are clamoring to put purchases aside until they can pay it off in cash. It's a practice made popular during the Great Depression but nearly became extinct due to the instant gratification of credit cards.
"They are trying not to use that credit card or they don't have cash," an employee at Backwoods clothing store told CBS 2 HD.
At Backwoods on the Upper West Side the owner said his customers appreciate the service of letting them pay over time.
From local shops to big box retailers, layaway is luring cash-strapped customers. One Kmart in the Bronx is about to rent a trailer to hold the overflow from their layaway room.
"It helps them on larger ticket items spread the payments out eight weeks and then they can pick up before Christmas and have it paid for and not worry about the credit," said John Plate, manager at the Kmart in Baychester.
Other stores offering layaway this holiday season include TJ Maxx, Burlington Coat Factory and Marshall's.
And in a new twist to layaway plans head online where a number of Web sites like elayaway.com let bargain hunters choose a payment option affiliated with any number of retailers.
Terms and fees vary from store to store but under New York City law a merchant must disclose in writing the terms of the layaway plan, including any additional charges and where and how long the merchandise will be held.
(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)
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