ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Tuesday, December 24, 1996 TAG: 9612240063
SECTION: BUSINESS PAGE: B6 EDITION: METRO
DATELINE: DES MOINES, IOWA
SOURCE: ASSOCIATED PRESS
Paying by charge card just isn't Jennifer Davis' style - she uses old- fashioned layaway plans for her holiday purchases.
``I hate charging things. You just have that guilty feeling,'' she said. ``If you use layaway, you're paying it off and you don't accumulate interest.''
Fewer and fewer Americans, however, are willing to forget about credit cards and use layaway plans as their means of payment, especially with the growing availability of consumer credit. Many retailers, in turn, are scaling back their layaway programs.
Before credit cards became an integral part of society, shoppers depended on layaway to help them buy merchandise that they couldn't pay for all at once. Instead, consumers would pay a certain amount weekly or monthly.
Today the population is saturated in credit cards, with 376 million Visas and MasterCards in circulation as of last June, up 80 percent from 1991, according to the National Credit Counseling Services, a nonprofit group in Columbia, Md.
``Retailers are offering interest-free financing, 90 days same as cash and all these other programs that allow an easier way to handle the transaction,'' said Bruce Van Kleeck, a vice president of the National Retail Federation, an industry group based in Washington.
``Layaways are a bit of a nuisance for the retailer,'' he said. ``You're maintaining essentially customer property in your inventory.''
With dwindling demand, many retailers are stopping their layaway programs. Such is true at Dayton-Hudson Corp., which owns Target discount stores, Mervyn's clothing stores and three department store chains.
``We have our own proprietary credit cards, so we think that's a pretty effective substitute for a layaway plan,'' said Susan Eich, a spokeswoman for the Minneapolis-based retailer.
But not everyone is dropping layaway plans, including the nation's largest retailer, Wal-Mart Stores Inc.
``We do get tremendous amounts of layaways for the holiday season,'' said Sharon Weber, spokeswoman for the Bentonville, Ark.-based company. ``There's a lot of folks out there who don't have credit cards. This is an excellent way for them to buy things.''
LENGTH: Short : 49 linesby CNB