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Shop Tips for Offering Layaway

One trend that appears to be emerging from the recent economic downturn is a resurgence in the interest in purchasing using Layaway. If you are looking for an additional tool to help increase your sales this Holiday season and beyond, you might consider adding this option to your Terms of Sale.

However, should you choose to offer layaway, it is important that you outline the specific terms of your plan in your Terms of Sale. Please be sure to include the answers to the following questions:

-Is layaway available for all items within your shop?
-Is there a price minimum for items offered on layaway?
-When must the buyer confirm with the seller that the transaction is a layaway?
-What percentage of an initial deposit is required?
-When are each of the remaining payments due and what is the minimum required amount?
-When is the final payment due – example: Initial 25% deposit with remainder due in 3 equal payments over a 90-day period.
-Do you reserve the right to cancel the transaction if payments are not made on schedule or in the agreed-upon amounts?
-If the transaction is terminated will the buyer receive a full refund of payments already made, and if not, what percentage will not be refunded? Is this if either party cancels?
-Do you accept returns on layaway items?

In addition, here is what the FTC says about disclosure of layaway terms:

Disclosing Layaway Terms
There are good business reasons to give your layaway customers written disclosures:
-they help assure that customers understand their payment obligations;
-they give notice to customers of your layaway policies;
-they help ensure that all customers receive the same information; and
-they help prevent misunderstandings and disputes.

For more information on layaway plans visit: http://www.ftc.gov/bcp/edu/pubs/business/adv/bus17.shtm

Article Last Update: September 25, 2018