Updated: August 30, 2015
As a blogger, I normally get invited to business events. While we don’t really get paid in cash to cover and write about them, we do sometimes receive gift certificates in exchange for our efforts in spreading the news about the business.
Moreover, giving GCs as a birthday present is something I normally do for friends. Giving them gift certificates to their favorite store or restaurant has always been a well-received and much-appreciated gift in my observation, plus it saves me from the hassle of thinking about a specific gift to buy.
Today, a guest writer shares the advantages of having gift certificates available for your business. This is a good read especially for restaurant owners. Let’s read what she has to say below.
The Department of Trade and Industry (DTI) defines gift certificates as an instrument issued by a supplier to an individual, partnership or judicial entity for monetary consideration evidencing a promise by the issuer that consumer goods or services will be exchanged in favor of the bearer upon presentation of said gift certificate to the value, credit, specific good, service or event shown in the instrument.
If you have a retail store, a restaurant, or any business that offers services to consumers, you can benefit from adding gift certificates or GCs to your portfolio of products.
Here are the ways:
1. Gift certificates as gifts
The most common reason why your customers buy gift certificates is because they want to give it as a gift.
To customers, it is a no-fail gift because the one receiving the GC has the freedom to choose what he or she likes from a store. In the U.S., gift certificates rank as the second most given gift by consumers. GCs are also issued by companies as gifts or incentives to their employees espcially during Christmas season.
Instead of giving them a bag of groceries, they give them gift certificates from a supermarket instead. Aside from the gains your company will generate from this occurence, around 10% of gift certificates go unredeemed due to loss or damage resulting to additional gains for retailers.
2. Promotions, sponsorships and more
Since your gift certificate is tied to your store, it can be used for various reasons to promote your business and delight customers.
For your sales and marketing promotions such as contests, you can use your GCs as prizes. These days credit card companies also like to reward their customers with GCs from stores or restaurants, offering a lot of opportunities for retailers and restaurants to tie-up with credit card companies.
GCs can also be given as sponsorship to concerts and events either as full or partial payment. It can also be given to appease angry customers, say, in case of product complaints or late food deliveries if you are a restaurant. The ways GCs can help promote your business are limitless!
3. Cash flow
Another benefit of gift certificates often overlooked is its contribution to cash flow.
If you sell 1,000 pieces of your gift certificates worth P100 each, you automatically have P88,000 (P100,000 less VAT) in your bank account at almost no major cost (except for printing costs). No merchandise has be sold, and no service has been availed yet, and you already gain this amount.
However, with its advantages also comes challenges.
Gift certificates are “good as cash” but unlike money, they are not strictly regulated by the government. They become very attractive targets for forgers and counterfeiters.
So how can you enjoy the benefits of selling gift certificates, while ensuring your company’s protection?
First, in printing your gift certificates, you have to incorporate anti-copy and anti-forgery security features. These security features allow you and your employees to easily detect tampered or forged gift certificates.
In fact, having these security features is already a deterent to counterfeiters because they know they will instantly get caught with their “fake” GC.
Next, you have to make sure that the printer you will commission for the printing of your GCs have the security facilities and procedures in place to ensure your company’s protection. You don’t want “excess” prints of your gift certificates to be circulating the market.
Lastly, you have to implement a system with strict controls in the issuance and acceptance of GCs, just like how you would treat your cash.
With the -Ber months nearing, it is time to plan your sales and marketing strategy for the holiday season. Offering gift certificates to your customers is a good way to start!
This article is written by Kim Perez of Tone Guide Press Inc., the pioneer and leader in security printing. They print the gift certificates and security forms of major corporations in country. For more information, you may call them at (02)3646071 to 76 loc. 114 or send an email to [email protected]
Photo credit: plumeperfume