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Layaway, other changes irk Wal-Mart loyalists
Some shoppers feel betrayed by decision to end layaway, remove fabric
 Carissa Ray / MSNBC.com Wal-Mart's changes, including stocking more trendy clothes, have made some longtime shoppers feel like the store is less interested in catering to family shoppers on tight budgets. |
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That in itself is not unusual. What is unusual is that, instead of pondering what toys she should buy at her local Wal-Mart, the 43-year-old mother of two is wondering how she’s going to play Santa Claus this year without the layaway option she had relied on.
“It’ll be less, let me put it that way,” she said. “They won’t get as much.”
Long after most mainstream department stores eliminated layaway plans, Wal-Mart continued to offer the old-fashioned service, which appeals mainly to consumers who either don’t have credit cards or already are carrying high credit card debt. But that ended last year when Wal-Mart eliminated the layaway program, leaving many customers seething about the change — and fretting about what to do this holiday season.
The move is especially jarring to some families because it has come amid other changes Wal-Mart has made, including cutting back on fabric departments and stocking more trendy clothes, as the discounting titan tries to appeal to a broader swath of shoppers, including more upscale consumers. Those changes, some longtime shoppers say, has made them feel like the store is less interested in catering to its traditional and loyal market of family shoppers on tight budgets.
“I always believed that they’re always trying to give us the lowest prices and they’re not for the rich man, you know?” said Jennifer Reynolds, a 28-year-old mother of four who used to depend on layaway for her children’s school uniforms and holiday gifts. “I just can’t believe that they would get rid of layaway and say, ‘Here, well, here’s a credit card.’ ”
Reynolds was, in fact, so angered by the decision that she started an online petition aimed at restoring the service, and sent two e-mails to Wal-Mart. She said the company never responded, although she continues to hear from other Wal-Mart shoppers disappointed by the change.
Layaway programs allow people to make a down payment on an item and then pay off the rest over a set period of time before taking it home. The system is still offered by rival Kmart, although most large retailers have long since gone exclusively to more modern payment forms including credit and debit cards, citing the cost and hassle of managing layaway programs.
Linda Brown Blakley, a spokeswoman for Bentonville, Ark.-based Wal-Mart, said the company decided to stop offering layaway because fewer people were using it and it was costing the company more.
Blakley also said more people now have access to other financing options, such as credit cards, than when layaway first started. For customers without credit cards, she said the company simply tries to offer the best value.
Patricia Edwards, an analyst with investment firm Wentworth, Hauser and Violich who owns shares in Wal-Mart, remembers visiting a Wal-Mart on the day after Thanksgiving a couple years ago and being surprised to see that the longest line in the store was for the layaway department.
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From a financial perspective, she said, allowing shoppers to put items on layaway instead of buying them outright is a big risk because some people will never pay them off. That leaves Wal-Mart stuck with merchandise it could have sold during peak demand times but instead has to offer at clearance prices.
On the other hand, Edwards noted, the decision to end layaway was a blow to many loyal Wal-Mart customers.
“It hasn’t helped reputationally, and it hasn’t helped especially with their core (low-income) customers,” she said.
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