Final answer:
'Buy Now, Pay Later' is a payment option that allows customers to purchase products now and pay for it at a later date. It can have a direct impact on the bottom line of retailers by attracting more customers and increasing sales. This payment option is particularly useful for retailers selling goods through mail-order catalogs or online platforms.
Step-by-step explanation:
In the context of retailers, 'Buy Now, Pay Later' can have a direct impact on their bottom line. The concept of 'Buy Now, Pay Later' refers to the option for customers to make a purchase and postpone the payment to a later date. This strategy can boost sales for retailers because it allows customers to acquire products immediately, even if they don't have the full amount of money upfront. By offering this payment option, retailers can attract more customers and potentially increase their revenue.
One example of 'Buy Now, Pay Later' is the use of credit cards. When customers use a credit card for a purchase, the credit card company transfers the money to the seller's checking account immediately, while the user owes the money to the credit card company at the end of the month. This essentially provides a short-term loan, allowing customers to buy now and pay later.
This payment option can be particularly useful for retailers that sell goods through mail-order catalogs or online platforms. Customers who cannot physically see or touch the products may be hesitant to make a purchase. However, the availability of 'Buy Now, Pay Later' can encourage them to buy something even if they are unsure if they want to keep it. Additionally, offering a money-back guarantee can further instill confidence in the purchase decision.