Even though most parents are still focused on shopping for their kids’ back-to-school items, Carrie Munns is already thinking about Christmas.
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.
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.
Reynolds, who lives on the military base in Fort Hood, Texas, said she still shops at Wal-Mart about once a week, but she’s stopped doing her grocery shopping there and also has noticed that some other items are now cheaper elsewhere.
Wal-Mart has recently acknowledged that many of its most loyal customers are being pressured by high gas prices and other costs, and it has lowered prices on some items.
Reynolds bought some school uniforms at Wal-Mart this year, although she said she also scoured garage sales and secondhand stores. For the coming holidays, she’s thinking of putting items on layaway at her local Kmart instead of shopping at Wal-Mart.
Munns doesn’t have that option, because there isn’t a Kmart in her community of Horn Lake, Miss., and the other big department and toy stores there don’t offer layaway, either. She said she and her husband have been trying to put money away in a savings account for the holidays, but she worries it won’t be enough for the pricier items her 6-year-old and 13-year-old will want for Christmas.
Munns goes to Wal-Mart for her groceries, and she likes the convenience of also being able to pick up other items at the Supercenter. But she said she’s been disappointed by changes she’s seen at the store over the past few years, including poor customer service and boxes in the aisles.
She also has cut back on buying clothes at Wal-Mart, because the store has started stocking trendier clothes that don’t appeal to her.
‘I’m 43 years old. I can’t wear pants that (hang) off your hips and shirts that show your belly button,” she said.
Wal-Mart has conceded that it has had problems with its push toward trendier items, and it has blamed apparel difficulties for contributing to weakness in some store sales.Wal-Mart spiffs up
As part of its push to broaden its appeal, Wal-Mart also recently finished remodeling many of its stores. While shoppers have welcomed the cleaner stores and better signage, some remodels and new store openings have angered longtime customers because they included replacing fabric departments with areas featuring party supplies.
Wal-Mart spokeswoman Tara Raddohl said that she didn’t know exactly how many stores no longer have fabric departments and that the company is still evaluating the project. But in general, she said, fabric has been a declining business for the company, and officials have been happy with sales in stores where it has replaced those items with party supplies.
Edwards, the analyst, said adding party supplies was probably a smart decision in the more urban areas where sewing has become less common. But in rural communities, where sewing is more popular and Wal-Mart may have been the only place to buy fabric, such a change doesn’t necessarily make as much sense.
In Joan Jennings’ retirement community of Bullhead City, Ariz., Wal-Mart was the only store where the many older women could buy quilting, sewing and craft supplies. Now, she said, the only options are to drive nearly two hours to Las Vegas — a trek that’s difficult for many retirees — or to ask someone in another part of the country to send supplies by mail.
Jennings, who is 70, has started asking her daughter in California to buy fabrics she uses to make clothes for her grandchildren, doll’s outfits and other items. With the added cost of shipping, she said her projects have become more expensive.
She scoffs at the idea of ordering fabric over the Internet instead.
“Most of these older women don’t even have computers,” she said. “I have a computer, but I probably wouldn’t it order online, either. I’d want to look at it.”
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