The gift that keeps on giving.
On March 31st 2018, the legislation for gift cards in New South Wales changed to allow gift vouchers the length of three years validity, two years increased from the original one year expiry date.
A typical consumer scenario includes customers phoning the day of or a day before said voucher expires, asking for an extension, which many business are happy to accomodate, due to the twelve month length of the voucher.If this same consideration was applied on a three year validity when the average life of a beauty business is three to five years, as gift vouchers are seen as a liability in terms of profit and loss, this allows for some disruption to the way the beauty industry promotes gift vouchers.
In three years the life of a beauty and wellness business can include changing ownership, becoming solvent or subject to menu changes and updates. How is one to redeem a service that is no longer provided on their menu, let alone sell a business with a gift voucher debt the size of Russia? While this change has only taken effect in New South Wales, chances for the ruling to be passsed along to other states across Australia are highly likely.
Fair Trading has a consumer friendly 'gift card checklist' which includes:
Check the expiry/issue date.Treat your gift card like cash – if you lose it, it's gone.
Read terms and conditions about getting ‘change’.
Check if there is an issue fee.
Beware of cards that charge a fee to check the balance.
How will gift cards effect your business if the validity is extended to three years?