Layaway Resurfaces. Could it Work for Wedding Vendors?
Layaway plans -- whereby you ask a retailer to hold merchandise you'd like to purchase and allow you to pay it off in installments, then retrieve it once you've paid in full -- had all but disappeared by the 90s. When everyone had easy access to credit, there wasn't much allure to delaying gratification. Now that credit is tight, and most consumers are nervous about taking on more debt, layaway is looking attractive once more. (Here's one article about the trend: MSNBC: Layaway Makes a Comeback.)Which got me to thinking: could wedding vendors create payment programs for their brides and grooms inspired by layaway?
Most wedding vendors sell services, not merchandise -- so, technically, there's nothing to lay away. But, vendors could offer brides the option to pay for their services ahead of their weddings in small increments -- say, monthly -- for a year or more prior to their wedding dates. Most people are less nervous about paying $75/month better than $1,000 at one time. And, such a plan would allow people who simply can't put $1,000, $2,000 or $5,000 on a credit card like they once could. Expand the concept a bit, and family members can join in by picking up a payment or two in lieu of gifts.
Just like it once did for designer bags and furniture, the option to prepay in small bits over time could help keep more expensive wedding packages in reach of more brides.
A few caveats spring to mind, though. I wouldn't recommend this if you don't have much tolerance for bookkeeping; implement a plan like this, and you'll need to do a lot more of it! You'll need to think through a cancellation policy: stores like K-Mart charge a small fee, but return money paid towards the merchandise. You'll need to decide how much you should charge for cancellations -- and whether that figure should vary based on how far away the wedding date is.
And, of course, marketing will be critical: make sure you can update your materials, your web site, and your ads to bring in enough clients to make the effort of setting up such a plan worthwhile.
Most wedding vendors sell services, not merchandise -- so, technically, there's nothing to lay away. But, vendors could offer brides the option to pay for their services ahead of their weddings in small increments -- say, monthly -- for a year or more prior to their wedding dates. Most people are less nervous about paying $75/month better than $1,000 at one time. And, such a plan would allow people who simply can't put $1,000, $2,000 or $5,000 on a credit card like they once could. Expand the concept a bit, and family members can join in by picking up a payment or two in lieu of gifts.
Just like it once did for designer bags and furniture, the option to prepay in small bits over time could help keep more expensive wedding packages in reach of more brides.
A few caveats spring to mind, though. I wouldn't recommend this if you don't have much tolerance for bookkeeping; implement a plan like this, and you'll need to do a lot more of it! You'll need to think through a cancellation policy: stores like K-Mart charge a small fee, but return money paid towards the merchandise. You'll need to decide how much you should charge for cancellations -- and whether that figure should vary based on how far away the wedding date is.
And, of course, marketing will be critical: make sure you can update your materials, your web site, and your ads to bring in enough clients to make the effort of setting up such a plan worthwhile.
posted by Laurie at 12:37 PM
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