Buying gift cards isn't enough to save local businesses, experts say - Business Insider

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Experts say buying gift cards will only 'go so far' unless the government steps in to save local businesses hurting from coronavirus-related closures

alike are encouraging shoppers to purchase digital gift cards to help cushion the blow from the lack of physical sales.

Several people shared similar sentiments on Twitter this week, stating that the push to buy gift cards overlooks bigger-picture challenges, like long-term revenue recovery and the immediate impact on employees who are being laid off en masse around the country. "On one hand, [gift cards do] have the benefit of accelerating cash flow into the business," said Jonathan Treiber, CEO of the offer management platform RevTrax.

"Closed businesses need to focus first on cutting costs to stem the bleeding in the near-term — with any gift card sales viewed as a cushion or rainy-day fund — either to cover expenses in a prolonged shutdown or for when they return to full operations," he said. "Running out of cash during a rebound would be a very unfortunate predicament that businesses should do their best to avoid by conserving cash in the near-term.

 

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