Baal-zebub
Site Admin
Joined: 01 Jan 1970
Posts: 124
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 Posted: Fri May 19, 2006 8:11 pm Post subject: Gift Cards for Cash Flow |
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<p>I sometimes have to remind small business owners that it is possible to "sell your way into bankruptcy." If receivables do not keep up with payables.</p>
<p>One way to ensure cash flow is to collect cash upfront, before the goods or services are sold. How to do that?</p>
<p>Sell a gift card.</p>
<p>Mark Clothier from BLOOMBERG NEWS, picked up by the Seattle Post Intelligencer, writes that: <a href="http://seattlepi.nwsource.com/business/260931_giftcards27.html">Retailers find profit windfall -- unused gift cards</a></p>
<blockquote>The potential gains for retailers are growing as gift cards become more popular. The International Council of Shopping Centers estimates sales of gift cards increased to as much as $40 billion during the holiday season from $30 billion a year earlier.</blockquote>
<p>There are some challenges on the bookkeeping of the liabilities of the unused cards. But this is a high quality problem to have. Your business already received the cash upfront. And 10% of cards are never redeemed.</p>
<p>However, you want the gift card holder to come in. <a href="http://emergingclass.com/?p=21">EmergingClass.com</a> reports that the customers who redeem the card may spend an additional 40%. </p>
<p>Gift cards. A good deal for cash flow.</p>
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