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Is Layby Shopping on the way out?

“World famous U.S. retailing Giant Wal-Mart Stores Inc. will end layby service before the end of this year. Referred to in the US as layaway , and in some Australian firms as laybuy , the service will be scrapped by Wal-Mart due to reduced demand and rising processing costs. The Wal-Mart layby tradition started when Sam Walton founded the chain back in 1962 catering to low income rural shoppers in northwest Arkansas. Is layby shopping also on the way out in Australia? A layby system allows customers to make a down payment to hold an item and then gradually pay it off, with varying time frames usually reduced during the peak Christmas season. Pat Curran, executive vice president of Wal-Mart store operations says demand for layaway service has declined steadily as consumers turn to current options including online shopping, shopping cards and zero cost credit alternatives that were not available when the company was started. The company is working on ways to make other time payment methods available to customers with limited credit, such as Wal-Mart cards with zero interest for the first 12 months. In other changes this year, Wal-Mart has introduced bonus caps for hourly workers, after forty years of unlimited annual Bonuses. It has also ceased retailing guns and ammo in about a third of its stores to make room for other sporting gear. The company is also deliberately tailoring each store to local demographics rather than presenting the same stock in all outlets. It is evident that big changes are taking place in major retailers in all western countries. Many Australian retail stores still offer a layby service including major department stores David Jones and Myer. David Jones however recently more than tripled its fee for lay-by purchases, worrying consumer groups who fear people are being pushed into expensive store cards instead. There are also a plethora of smaller Australian retailer and online shopping sites that offer layby. Will the major Australian retailers also push shoppers on to cards and eventually retract the layby system like Wal-Mart in the US? Will offering layby services then be another way that smaller retailers can better compete with the majors? What are your thoughts on the layby service? Is it still needed? What stores offer it in your local area? Are they all charging fees for layby purchases? Are the terms excessive? Please tell our readers about your layby experiences.”

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