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Latest | Highest ratedGift Card Sales Backfire: Implications for Retail Sector? [View article]
Even though the retailer may earn interest on funds from the gift cards, the interest earned is negligible at best. The earned interest is offset by other costs, i.e. cost to maintain gift card system, printing costs of plastics, etc. Furthermore, the "value" of the card is a receivable and can't be recorded as income until the card is used by the consumer. So a consumer holding onto a gift card indefinitely doesn't necessarily benefit the retailer all that much.
Gift Card Sales Backfire: Implications for Retail Sector? [View article]
Even though the retailer may earn interest on funds from the gift cards, the interest earned is negligible at best. The earned interest is offset by other costs, i.e. cost to maintain gift card system, printing costs of plastics, etc. Furthermore, the "value" of the card is a receivable and can't be recorded as income until the card is used by the consumer. So a consumer holding onto a gift card indefinitely doesn't necessarily benefit the retailer all that much.