Walmart Kicks Off Holiday Season With Free Layaway

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Walmart is kicking off the 2013 holiday shopping season with free layaway.
Photo by Joe Raedle/Getty Images

It may be only August, but Walmart already has Christmas on its mind: Today it fired the first shot in the holiday pricing wars by announcing a free layaway program to start next month.

Last year, Walmart Stores (WMT) announced a $15 open fee for its layaway program before lowering it to $5, which would be refunded in the form of a Walmart gift card at the end of the layaway period. This year, Walmart is going a step further by waiving the fee altogether. The program will start Sept. 13 and run through Dec. 13. There will still be a 10 percent down payment and a $50 minimum purchase, as well as a 10 percent cancellation fee.

In case there was any mistaking the significance of the announcement, Walmart made it clear: The layaway program "will kick off the retailer's official start to the holiday season."


Ditching the layaway fee is partly a matter of keeping up with the Joneses -- the Joneses in this case being Sears and Kmart -- both operated by Sears Holdings (SHLD) -- as well as Toys R Us, all of which already offer free holiday layaway. But it's also in response to Walmart's recent struggles to hold onto its low-income customers, who are most likely to take advantage of the pay-as-you-go option.

As we noted last week following Walmart's disappointing sales report, the retailer is facing economic headwinds in the form of lower discretionary spending. But it's also dealing with the fact that consumers struggling to make ends meet are choosing competitors like Family Dollar (FDO) when deciding where to spend the few bucks they have left at the end of their paycheck. These are the customers most likely to need layaway for their Christmas presents, and if given a choice between a $5 layaway program and a free one, their decision is going to be easy. We'll see if ditching the layaway fee is enough for Walmart to get its mojo back this holiday season.

Matt Brownell is the consumer and retail reporter for DailyFinance. You can reach him at Matt.Brownell@teamaol.com, and follow him on Twitter at @Brownellorama.


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BoboinVegas

Wal-Mart has been suffering from an image problem as well in the past few years. The store in the neighborhood where I shop has been going down hill fast, no employee friendliness, long lines at check out, shelves in disarray, and items not in stock. However; they have started addressing these issues, with self check, and the store is cleaner. It also depends on the neighborhood, and I suppose the manager. I love the lay a way, especially since it is free, and I like the holiday only, prevents me from overbuying. I like to get the items I want early, and lay a way is a good way, and I pay them off in time for Christmas.

August 26 2013 at 4:23 AM Report abuse rate up rate down Reply
jelun

Forget about buying at retail stores, go to your local flea market.

August 22 2013 at 2:08 PM Report abuse rate up rate down Reply
suecnrd

So, I read \"Holiday Season,\" and I\'m casting about in my mind as to what holiday they\'re talking about - Labor Day, Halloween? Then, I thought, \"They can\'t possibly be talking about Christmas.\" But, yes, they are. I like Christmas, but, this is getting ridiculous.

August 22 2013 at 11:31 AM Report abuse rate up rate down Reply
Bye Birdie

Lots of cash registers - Customer is always first - Sure he is unless we can save a buck

August 22 2013 at 10:11 AM Report abuse rate up rate down Reply
saweet97hog

all chinese garbage

August 22 2013 at 9:23 AM Report abuse rate up rate down Reply
rilaza2005

It won't help them.First of all,Kmart and the others have layaways all yr long.Kmart will even allow sale and clearance on layaway and includes ALL depts.Walmart limits to toys,jewelry and electronics.I'll still take my business elsewhere.I like clothing,bedding and other depts on my layaways,and not just for 2 months per yr!

August 22 2013 at 4:35 AM Report abuse +1 rate up rate down Reply
Stephen

Free lay-away..... sounds like a funeral home.

August 21 2013 at 10:22 PM Report abuse +2 rate up rate down Reply
dennislee431

OH AND 1 OTHER THING WALMART IS NOT THE LOW PRICE LEADER, USE YOUR SMART PHONE TO COMPARE PRICES WHILE YOU SHOP YOU WILL FIND MOST OF THE TIME WALLY WORLD IS NOT THE LOWEST. ITS A MYTH

August 21 2013 at 8:42 PM Report abuse +2 rate up rate down Reply
1 reply to dennislee431's comment
Stephen

Problem is, with the exception of occasional "sales" and "specials".... or "buy one and get one free" promos..or maybe "buy two for the price of one" (same concept), Walmart is generally much cheaper than any of the grocery stores.

August 21 2013 at 10:25 PM Report abuse -1 rate up rate down Reply
dennislee431

does anyone remember the time before walmart got rid of its layaway program years ago when there would be 70 to 100 trailers full off layaway goods in the parking lot. then they dfecided they didnt want that hassle. I guess know thet realize most of there shoppers are poor and dont have a walmart visa card. just glad i dont have to stand in those layaway lines.OH YEAH WALMART STOCK YOUR SHELVES , TO MANY OUTS. YOUR SALES MIGHT IMPROVE IF YOU HAD PRODUCT ON THE SHELF.

August 21 2013 at 8:37 PM Report abuse +2 rate up rate down Reply
pdbliz

I went to Walmart today,,,,,,,,it is not the Walmart of yesterday......Less people working,,,,,100% China junk,,,,,,,but,,what store is not China.?????
And WAGES,!!!!! believe it or not,,,some of the older workers do make a good wage,!!!! Ask them,!!!! But,,,most of the workers,,,get Welfare benefits also...
ADD THIS UP,,,THEY MAKE MORE THAN PEOPLE THAT WORK HARD......
And,,more you have to pay workers,,,more the items go up....same as the union wages.!!!!!

August 21 2013 at 8:25 PM Report abuse rate up rate down Reply