Lay-by is an arrangement where a customer reserves an item and pays for it over time, taking the goods only once the full price is paid. It is common for gifts, furniture, jewellery and seasonal items.
The retailer records a deposit, schedules or accepts further payments, and holds the stock aside. In a POS, a lay-by is an open order linked to a customer, with a balance and payment history. When the balance reaches zero, the goods are released and the sale is finalised.
Retailers use lay-by to win customers who prefer to spread payments without borrowing, and to secure sales ahead of peak periods. Some stores run lay-by seasonally, while others offer it all year. Retailers sometimes charge a small administration fee for setting up a lay-by, and any fee or cancellation charge should be clear in the written agreement. Staff should explain the terms before taking the deposit.
Lay-by has legal requirements under the Australian Consumer Law and state or territory rules, including a written agreement and limits on cancellation charges. These rules change, so check current ACCC and state fair trading guidance. Also check how your POS handles stock reserved against unpaid orders, and how overdue and cancelled lay-bys are managed.
Lay-by suits some retailers, but poor tracking leads to locked-up stock and disputes. Clear terms and good records protect both sides.