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Layaway purchases make comeback during holiday season

12:44 AM, Nov 29, 2012   |    comments
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  • Kim Allen used layaway to purchase a ski set for her son this Christmas season.
  • Alpine Ski Center in West Knoxville offers a layaway option for their outdoor sports equipment and clothing.
    

Holiday shoppers may have noticed a retail trend "flashback" lately as layaway purchasing continues to grow in popularity again.

The payment option, a once-common choice for purchasing large-ticket items, allows consumers to reserve an item and enter an agreement to pay the price over a period of time. Only once the item is paid in full can the buyer take it home. Those payments are interest free.

"It was something that retailers did before credit cards were so important to people and a way to do something similar," said Ann Fairhurst, of the University of Tennessee Department of Retail, Hospitality and Tourism Management. "And it just gave the people an opportunity to purchase products, but still do it over time."

Layaway payment plans faded significantly once credit cards became a primary payment option, but Fairhurst points to a recent struggling economy for the sudden resurgence of the practice. Big box stores like Kmart, Sears, Walmart and Toys 'R Us lead the charge on new layaway efforts.

"Over half of all Americans have some kind of impact from the economy still, and that was going to affect their holiday spending," Fairhurst said. "As in past years, they're always looking for ways to cut corners, and one way to do this is through the layaway purchasing."

Alpine Ski Center in West Knoxville offers a layaway option for their outdoor sports equipment and clothing.

"That's how we get our products moved," said employee Tanh Cao.

In a tough economy, Cao says layaway allows customers to buy what he calls "luxury items."

"It's not a necessity by any means for us to have that, and [to] have customers still come through here - that's a plus."

Kim Allen used layaway to purchase a ski set from the store for her son this Christmas season.

"They'll keep it for you until you pay for it and take it home, that's a good thing!" she said, after making her final payment Wednesday evening.

"Especially if you've got more than one child. You can at least come in here and get them a couple of things and put it in layaway and that way you know they've got something for Christmas."

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