By George Anderson
Numbers demonstrate tax-free sales days not only boost business but also help retailers achieve larger margins, as well.
According to an article in USA Today, "There's a growing recognition among retailers and savvy mall owners that shoppers are suckers for 'tax-free' sales -- discounts equal to the sales tax rate. These sales often save consumers far less money than more traditional 10%- or 20%-off sales, experts say."
Pam Murtaugh, a marketing consultant, told USA Today, "The rational consumer would add it all up and say, 'I'm not getting such a great deal at the tax-free sale.' But shoppers, in the end, do what makes them feel good."
North Plains Mall in Clovis, N.M., is promoting a tax-free sale. Most mall merchants have agreed to pick up the 6.375% tax. Even the mall's restaurants and nail salons have signed on, says Cindy Banister, the mall's property manager.
Mike Muscato, owner of the All About Sports shop in Clovis, New Mexico says he gets more traffic from "tax-free" sales days than when he runs a quarterly 30 percent off sale. "People love the illusion they're pulling one over on Uncle Sam," he said.
Nine states including Connecticut, Georgia, Iowa, New York, North Carolina, South Carolina, Texas, South Carolina, Vermont and West Virginia currently have tax-free days planned for this year.
Moderator's Comment: How smart are consumers? What are the keys to developing loyal customers?
We object to the term "suckers" being used in the USA Today piece to describe how retailers see consumers. The ones we know see customers they wish to serve. Making a profit doing it is the point of being in business in the first place. [George Anderson - Moderator]