Lease-to-own Chain Aaron’s Begins Offering Smartphones in 80% of Its 2,100 Stores

Lease-to-own chain Aaron’s in the past week began offering smartphones online and through about 80 percent of its 2,100 stores, President Steven Michaels said on an earnings call Friday. That's a reversal of the chain’s policy announced in July of putting off launching smartphones until 2016, Michaels conceded. “We believe in the smartphone category, as we did back in the summer when we announced our delay,” Michaels said. “Our customers are asking for these devices and it continues to be the category that gets searched most often on Aarons.com.” The chain wanted to address several “issues” before it felt “comfortable” jumping into the category, he said. For example, Aaron’s has partnered with a third-party service vendor to “ensure a proper wiping and refurbishment on the phones as they come back off of lease,” he said. “We've got a tight and narrow device lineup of current-generation phones that we feel good about. And we're going to be conservative in our inventory positions and continue to pay attention to the industry and make sure we're reacting and dunk it home.” Aaron’s plans to partner with a “national” wireless carrier in 2016, he said. But for now, customers who walk into Aaron’s stores can procure “unlocked GSM-capable devices,” he said. “We've asked the stores to partner with local stores to get the activation on from a prepaid standpoint, assist the customer in doing that,” he said. “We are talking to carrier partners, and we do think that activation is a key component of the program, and we do intend to have a second phase in 2016 via a national partner carrier and that will help provide us some additional margin through the activation and refill of the airtime.”