Walmart Brings Back Layaway for the Holiday Season

Wal-Mart (WMT) is bringing back something its customers have been asking for since the Great Recession: layaway.

The world's largest retailer, which ditched the pay-as-you-go plans in 2006, is rolling out a holiday layaway option from Oct. 17 through Dec. 16. Wal-Mart is following rivals that brought back the service during the thick of the recession.

The move comes as Wal-Mart's mostly low-income shoppers are increasingly being squeezed by high unemployment and rising costs. It also comes as Wal-Mart Stores Inc., based in Bentonville, Ark., aims to reverse nine straight quarters of declines at its namesake U.S. stores open at least a year - a key measure of retailer's health.

Have you ever used a layaway plan to make a purchase?
Yes. I had a great experience in doing so.1 (25.0%)
Yes, but I probably will not do it again.1 (25.0%)
No, but I'd consider it.1 (25.0%)
No. I don't like the idea of layaway.1 (25.0%)
"We're always looking for ways to ease budget strain for our customers, and we know this holiday season brings with it additional financial pressure," said Duncan MacNaughton, chief merchandising officer at Wal-Mart's U.S. division. "This was a key component that our customers asked us for."

Layaway - an agreement that allows shoppers to pay over time, interest- free, and pick up their merchandise when it's paid in full - became popular during the Great Depression. The practice had become largely a thing of the past as the economy flourished and consumers were feeling more confident. But when credit dried up, and the job market turned sour during the recession that began in late 2007, Sears and other merchants added back or expanded the service.

Citing increased costs and lower customer demand, Wal-Mart phased out layaway in September 2006 - roughly a year before the recession began - with the exception of fine jewelry. But the discounter faced criticism because it built its reputation on helping its low-income shoppers.

Wal-Mart said it will be able to limit costs now by limiting the layaway program to toys and electronics with a price tag of $15 or more. It also added a $5 non-refundable service fee and $10 cancellation charge for any orders not picked up by Dec. 16 or cancelled by the customer.

The program, which has a minimum layaway purchase of $50, is only available at stores and doesn't include online purchases. It also requires a 10 percent down payment. The company said if the program is successful, it may extend the layaway throughout the year.

The layaway plan is part of Wal-Mart's efforts to turnaround its struggling U.S. business. In addition to the layaway program, Wal-Mart said that starting Monday, it will launch price cuts on dozens of holiday toys to $15. The company also said that it will start offering a small samples of holiday merchandise, including outdoor decor, later this month, two weeks earlier than a year ago.

These moves are just the latest effort by Wal-Mart to revive sales. Wal-Mart has been going back to "everyday low prices" instead of focusing on pricing gimmicks like temporarily slashing prices on select items that caused some shoppers to go elsewhere. It's also finishing up restocking thousands of items it cut during an overzealous bid to clean up its stores.

Increase your money and finance knowledge from home

What Is Your Risk Tolerance?

Answer the question "What type of investor am I?".

View Course »

Small Cap Investing

Learn now to invest in small companies the right way.

View Course »

Add a Comment

*0 / 3000 Character Maximum


Filter by:
Veronica Mcghee

When can you startputting things in layaway at walmart?

September 01 2012 at 8:15 AM Report abuse rate up rate down Reply

Why is the layaway plan limited to toys and electronics? Why not clothes and housewares? And there are toys that don't cost $15.oo, there shouldn't be so many stipulations for the use of layaway. I thought it was to help the people who can't afford to pay alot out at once, but yet you want to tell us what we can get!!! No thanks, I'll continue to put my stuff on layaway at KMART!!!!! Way to go KMART......we can put anything on layaway with you!!!!

October 05 2011 at 6:31 AM Report abuse rate up rate down Reply

hope they decide to keep the layaway after christmas is over with,they should let you put whatever you want on layaway besides just toys and electronics

September 28 2011 at 7:50 AM Report abuse rate up rate down Reply

I am glad they decided to bring back the layaway and hope they keep it. However, I feel them limiting it to toys and electronics was a bunch of crap. It looks like I will be using Kmart again this year. Even though I enjoy Walmart, I buy clothing and other stuff for my children and family members as well. I do hope that Walmart will change their minds and add other stuff as well.

September 22 2011 at 9:27 PM Report abuse rate up rate down Reply

as a mom of 5 i think walmart needs to bring back the lay away full time and it was a god send to me for birthdays school and for items i just did not have the cash to buy out right i live about 20 minutes from walmart but idrive about 50 miles out of my way to go to kmart and use the lay away to buy the things my kids need

September 22 2011 at 4:22 PM Report abuse rate up rate down Reply
judi b

I used layaway for years when my kids were younger. It was a great hiding place and I could get just a little extra. Now that I am single and on a very strict Social Security budget there might be some furniture I would be interested in and I really would like to get some new clothes but according to this article they are not included. What about towels, sheets, rugs, luggage, etc.

they need to bring back the fabric dept and also bring back tons of the deleted merchandise. They had White Stag clothes which were good quality....they went away also.

September 21 2011 at 12:45 PM Report abuse rate up rate down Reply
Cathy you're bringing back layway...YAY WALMART...but I reading this right? They're going to limit it to toys and electronics only? And it has to be over $5, and you have to have a minimum of $50, and there's $10 cancellation fee, and you have to paint the CEO's house, and chane his oil.. damn...can it be anymore complicated?

September 09 2011 at 9:31 PM Report abuse +1 rate up rate down Reply

Walmart- what a joke. Low prices? Pshaw! Wide selection? Hahahahaha! Good quality? Pththththth!

September 09 2011 at 9:07 PM Report abuse +1 rate up rate down Reply

Wal-Mart is a joke. They have like 30 check out lanes but most of the time only 7 are in use. Four are express and the other three are for those that have a lot of time on their hands and love waiting in long lines to check out. Seems to be a waste of money having all that equipment sitting idle.

September 09 2011 at 7:28 PM Report abuse rate up rate down Reply

Duh in this economy its a no brainer, however I think Walmart is going through a brand identity crisis and has been for the last ten years.

September 09 2011 at 7:25 PM Report abuse rate up rate down Reply