Gift cards to restaurants aren’t only great for the people who receive them — many businesses also reap the benefits.
January and February are typically slower months, according to Tom Boucher, owner of Great NH Restaurants, which includes T-BONES, Cactus Jack’s, Copper Door and CJ’s Great West Grill.
For every $25 gift card, the company offers $5 complimentary cards. The promotion starts 10 days before Thanksgiving and lasts until Jan. 1.
“It is really a driving force for us to keep people coming in the door during somewhat slower months being the winter,” Boucher said.
A survey from the National Restaurant Association showed about 47% of adults in the United States planned to give a restaurant gift card during the holidays. MKM Partners analyst Brett Levy said gifts card sales could mean a positive start for restaurant sales in the first quarter.
“We certainly see a huge uptick in gift certificate sales in the holiday season, and that does spill over into January where there are an awful lot of folks that usually try to redeem their gift cards in a relatively short period of time,” said Mike Somers, president and CEO of the New Hampshire Lodging & Restaurant Association.
Common Man founder Alex Ray works on the “Peverly” sign that now hangs outside the Barn on the Pemi in Plymouth next door to the company’s Italian Farmhouse restaurant. Ray says gift card sales help drive new customer traffic to the Common Man Family of Restaurants.
Different parts of the state experience different peak seasons, but summer is typically the busiest, he said.
“It is an opportunity to have new customers come and try your place and hopefully they fall in love with it,” Somers said.
The Common Man, which operates 15 restaurants, two inns, a spa, convenience stores and The Flying Monkey Movie House & Performance Center, offers gift cards for up to 25% off, said owner Alex Ray.
“We sell a tremendous amount from Dec. 1 to Christmas,” he said. Many people or companies buy in bulk because of the discount.
“It encourages new people to come that might not have thought about us until they get a gift card,” Ray said.
The sale of gift cards doesn’t count as income for tax purposes until the card is redeemed, Boucher said.
He agrees with the overall benefit of gift cards for business.
“Who doesn’t like a restaurant gift card? Everybody likes to go out,” Boucher said.
Material from Bloomberg was used in this report.
