Across the United States, consumers face a multitude of financial stressors. The rising cost of living, uncertainty surrounding the pandemic, and potential increases in interest rates are just a few of the issues influencing their spending decisions. Many feel particularly cautious about purchasing durable goods, generally defined as goods that do not wear out quickly and are used by consumers for more than three years, such as sofas, beds or refrigerators.
Many consumers believe that they have only two viable options for purchasing durable goods: depriving themselves of potential necessities or going into unsecured debt. However, they still have another option to consider: buying on a hire-purchase basis. This method allows consumers to purchase the goods they need using flexible payment options over time.
The secret of the lease with option to buy: giving consumers control over their purchases of durable goods, a PYMNTS and Katapult collaboration, examines how rent-to-own purchase options can give consumers greater financial flexibility when purchasing durable goods. The report is based on a balanced census survey of 2,688 US consumers. It reveals how they currently pay for durable goods and how rent-to-own plans can positively impact their relationships with their favorite merchants and increase sales.
Key findings of the report include:
• Over the past 12 months, 62% of US consumers have purchased durable goods. The most purchased durable goods are home furnishings, cited by 33% of consumers. Twenty-eight percent of respondents said they purchased consumer electronics, 27% purchased household appliances, and 26% purchased auto parts.
• The most common reason consumers use financing options is to better manage their finances. Sixty-seven percent of rent-to-own users and 57% of buyers Now Pay Later (BNPL) users would not be able to purchase desired durable goods without access to these financing options.
• More than a quarter of respondents would not buy durable goods from a traditional retailer that does not offer rent-to-own options. Sixteen percent said they wouldn’t make the purchase and 10% would go to a hire-purchase store and try to use hire-purchase financing.
To learn more about durable goods buying and financing trends, To download The report.