Layaway plans are an old idea that are being brought back to help improve sales.
There was a lot of talk this past holiday season about reviving layaway plans. I am very familiar with the plans because my mother’s stores offered them and I used them for many years myself as a consumer. Once my mother explained the purpose, it made sense to use a layaway plan for some purchases.
A perfect example is a winter coat. They are displayed and put on sale in September, too early for some people. The layaway plan allowed you to get the choice coat at the best price and not fully pay for it until you needed it—often several months later. Typically a 20 percent deposit was needed at the first payment. Thereafter, payments could be made as often as the customer would like. There are no charges for a layaway service.
From the point of view of the retailer, merchandise is moved out faster, and some money comes in right away. The customer also comes in more often to pay on the purchase, making it very likely that the customer will end up purchasing more items.
Would layaway work in the framing industry? It would work very easily for something that is ready-made: pre-framed art, even loose art or any gift item like photo frames and gifts. For custom work, it is more of a payment plan. In our case, we would take a 50 percent deposit and complete the piece while the customer paid us over time. We would hold the piece in stock until the customer finished making payments. This may not be the easiest thing to explain to a customer, but you may be getting more requests now that it has had so much press.
Here’s the process: a customer chooses a framed item priced at $200. You take $40 as a down payment and give the customer a receipt. The customer can then make several payments, such as $20 week or month (up to six months), until the item is paid off. You do need to maintain a record of payments and receipts. A Point of Sale software program may provide that information. Also, there are layaway tickets available at NEBS mail order service and in the Business Forms DVD from Columba Publishing. A small sign in your shop stating, “Layaway Plans Are Available” should be enough to boost sales.