Kmart (Stock Quote: SHLD) is kicking it old school this week as they try to reinvent a classic money-saving strategy: the layaway.
The discount retailer will begin offering online customers the layaway option this Friday in an attempt to provide its in-store offerings to its online customers. So, how does it work?
According to a Kmart press release, online customers shop the same way as they would if they were making a normal online purchase. They then choose to initiate a layaway contract before they purchase the items.
The contents of your online shopping bag are then held at a store near you until you pay the full amount of the layaway contract.
A great feature of Kmart's new online layaway is that customers can pay their contract online or in the store. The same thing goes for customers who put something on layaway in the store and then want to pay the contract from home. Convenience is key.
“We have an entire generation of customers that grew up shopping online,” said Mark Snyder, Kmart’s chief marketing officer, in a press release. “Launching online layaway at Kmart engages these customers by allowing them to spread their payments out over time and better plan their spending.”
Before you sign up, take note of some of the rules and regulations.
First, all layaway customers must pay a $5 initiation fee. In addition, you’ll have to fork up a $15 or 10% (whichever is greater) down payment that must be made when you initiate the contract. Customers must make payments every other week and the item must be paid in full by the end of eight weeks. When the item is paid in full, it must then be picked up at the store - it won't be delivered to your home. Also, as with Kmart’s normal layaway plan, certain items are excluded
The launch of online layaway rounds out Kmart's "National Layaway Week" as the retailer begins to encourage holiday spending. To learn more about Kmart's online layaway, check out these fast facts.
—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.