(For those who are not familiar with the term "Lay-by", it means a consumer pays instalments for certain goods, and the store holds the goods until the full payment has been made. Wiki, Australian Government Law)
There are a few things wrong in this. Allow me to elaborate.
(1) Today's super-modern and extremely picky kids do not want outdated toys. The current "hot" toys many not be popular by Christmas.
(2) You do not know what kids really want. You are not taking the kids to the store and let them pick the toy, and tell them they have to wait half a year.
(3) Although I can understand the financial merits of "lay-by" over buying with credit. But, why bother? If you can't afford consumer goods, don't get it. You can earn more rewards when using your credit cards. (To Don: although I like to use my credit cards for shopping, I don't spend more than I can afford. I use credit cards for earning rewards and I pay off the bills in full by the due date.)