Feature of the Month

February 2003

Managing Gift Certificates

Statistics show that the majority of gift certificates sold/issued by retailers are never redeemed.  This is a double-edged sword, because while a gift certificate left unredeemed is nearly pure profit, it also means the holder of the gift certificate hasn’t come to your store to redeem it.

With a little preparation and some creative design work, you can have RetailPro 8 not only manage your gift certificates, but even print them and report on the profitability of them, so you can know how many of those little slips of liability are coming back to your store (hopefully with new customers in hand!) and how many are going to become money in the bank after they expire!

Gift Certificate Basics:

1.                   Be consistent about gift certificate numbers. 
When using Retail Pro to track the gift certificates at point-of-sale, enter in the gift certificate numbers printed on your forms, or better yet, have RetailPro suggest the number for you!  By tracking the numbers accurately at P.O.S., you can report on them to see which ones have been redeemed and which ones are still in the hands of a customer.

2.                   Secure your gift certificates. 
Every one that has a dollar amount outside of your store(s) is a liability.  If they are stolen or given away by a cashier that’s really nice to their friends, you’re not getting the cash value for them, which could be disastrous financially.  Finding the balance between securing your tenders and providing efficient service to your customers is tricky, but necessary.  As an alternative, you can have RetailPro 8 print the gift certificates, making theft impossible.

3.                   Make your gift certificate policies known to the customer.
If you issue another gift certificate as change when one is redeemed, the customer should know this up front.  Some people will expect cash back if there’s no stated policy.  Pre-printed gift certificates probably won’t have your policy, so adding an additional leaflet with the policy printed on it is good.  By having RetailPro 8 print your gift certificates, you can include your policy (a.k.a. ‘the fine print’) as part of the design for the customer.

Designing Gift Certificates in RetailPro 8: As with designing any document, creativity and presentation are crucial.  At right is a sample gift certificate designed for a tri-fold, letter-sized page.  The bottom third can be perforated (pre-perforated papers are available from stationary distributors) to tear off the actual certificate portion.  The top two-thirds could contain gift certificate policy, return and/or exchange policies, other receipt information or even advertising. Some other common designs for gift certificates, on a letter-sized page could be a half-page design that’s folded or a full-page design, similar to a company letterhead.  In a multiple-workstation store, one printer can be utilized by multiple P.O.S. workstations to print to the same printer just for gift certificates.  They can also be printed on a report printer in a back room.

Looking at the design example at the right, the date is in the upper-left corner and the gift certificate number (assigned by RetailPro in this case) is in the upper-right corner.  The bright ‘Gift Certificate’ is eye-catching and obvious to remind the holder to go use it!  The store addresses and phone numbers are listed for convenience, as well as ample space to fill in the name of the recipient.  Lastly, the value of the gift certificate is plainly visible and the bottom line states clearly that the gift certificate has no cash value and is only valid for one year after date of purchase.

This design is a receipt design within RetailPro, so it can be printed to another letter-sized printer from the former receipt list.  Any ink-jet or laser printer would handle this with no problems. 

Except for the ‘Gift Certificate’ artwork, all the design elements are native to the RetailPro document designer.  The fancy 3D text was created using WordArt from within MS-Word.

Our training staff can assist with any design work you may need.

Fields used in example design at right:

DocDate (date of purchase in the upper left corner), GiftNum (the gift certificate number in the upper-right corner), GiftPurchase (the amount of the gift certificate in the box at right).  All the rest are text or graphical elements that remain static.  The GiftNum field can be setup to be barcoded and printed on the gift certificate as well, to ensure proper tracking of the gift certificate when it is redeemed.

Preferences that pertain to Gift Certificates

System Preferences > Point of Sale > Tender Options

Putting a check in the Gift Certificate row within the Receipt Tenders grid will require the receipt to have a customer listed on a receipt where a gift certificate is received as tender or sold/issued.

System Preferences > Point of Sale > Receipts

The option ‘Suggest Gift Certificate number for change tender’ will allow RetailPro to suggest the numbering for gift certificates as they are sold.  This can be manually over-written by the cashier.

System Preferences > Point of Sale > Receipts > Tenders

Checking ‘Gift Certificate’ in the top group will show a change window with the amount of the gift certificate to be issued. Checking ‘Gift Certificate’ in the lower group will allow a gift certificate to be used as a tender on a return receipt.

W/S Preferences > Sequences

The sequential numbering of gift certificates can be changed here.

Reporting on Gift Certificates

A sales journal can easily track gift certificates sold as well as redeemed.  A sample report preview is below.

Since an outstanding gift certificate is a liability, the sold gift certificate will show as a negative amount on the sales journal.  They will show as a positive amount when redeemed.  From the sample preview below, we can see that G.C. #13740000420004 was sold sometime before the period for which the report was run (the month of February).  However, #137400004200006 was sold on February 1^st and redeemed one week later.    The total (-$75.00) is the net value of outstanding gift certificates, or the outstanding liability for accounting.

The design of this report is very simple and is sorted by Gift #, Receipt Date & Document SID in order to group the activity for each gift certificate together for easy tracking.  This also will alert you to someone redeeming bogus or counterfeit gift certificates, as each number can only show up here twice: once when sold and once when redeemed.  A third entry for a number is suspect.  Also, a gift certificate redeemed that isn’t in line with your numbering scheme is also suspect.

In addition, the receipt total on this report gives you an idea of how customers are using their gift certificates.  Jane Doe bought only $15.59 worth of merchandise with a $100 gift certificate.  You can use this to evaluate your policy on redemption for less than the face value.  Do you give cash?  Or issue another gift certificate above a certain amount? 

One limitation of v8 is that you cannot tender multiple gift certificates on one receipt, so a policy by which you return a gift certificate as change needs one receipt to give the change as store credit (which means you need a customer on the receipt!), then a second receipt using the store credit to purchase the gift certificate for the customer.

This report also uses a custom filter designed to view only those receipts where a gift certificate was included as tender, to exclude cash sales, credit card sales, etc.  If you aren’t comfortable setting up filters, our technical staff will gladly get you set up to report on your gift certificates.