Yesterday, Black Enterprise Managing Editor Alisa Gumbs forwarded a press release to our entire content team announcing retail chain Sears’ promotion of online layaway at barbershops to potential shoppers, so that they could experience the service firsthand. The release was accompanied by a photo of Ronald Larry, a regular patron of De’ Bon’s Barber Shop in Chicago, test driving Sears’ new online layaway program for the first time.
“Now that Sears has layaway online, not only is it easy on my wallet,” Larry is quoted as saying in the release, “it’s easy on my time. I can even get that new flat-screen TV I want, and have it in time for Christmas.”
Gumbs response to this expression of shopping glee is a refrain that echoes often around the offices of Black Enterprise: “This is a hot mess.”
I was confused by her response. I couldn’t see why making layaway more available and accessible as a shopping option, especially given the current economic environment, couldn’t be a good thing. When I pressed her on this point, she responded, “You don’t find anything funny about Sears going into barbershops to try to get black people to use modern technology to buy high-end electronics that they can’t afford–on layaway?”
The truth is, I found it both funny and ironic. However, without layaway and online technology, these same people were still buying high-end electronics that they couldn’t afford, only they were doing it using high-interest credit cards.
With credit cards, they were paying in installments after the purchase and being charged compounded interest to boot. With layaway, they pay the installments in advance, only buying the merchandise after they’ve reached their “savings” goal, and without incurring the interest charges and other fees that are the vast majority of burgeoning credit card balances. With layaway, you have to budget for the purchase, and you have to really want it, since you have to pay nonrefundable fees to participate and failing to keep up with the payments could mean losing all or part of your deposits, depending on the policy of the retailer. Layaway eliminates impulse buying and forces delayed gratification, even if it’s for an item you shouldn’t be buying in the first place.
Back in the day, up until the 1980s or so, layaway was a very prominent option for low- and middle-income shoppers. Then more Americans began to gain access to credit cards, until we finally reached a point where just about anyone (including unemployed college students) could get them–even if they did come with sky-high interest rates and a myriad of fees and penalties in the small print. Layaway faded away as a shopping option, although it never really disappeared.