Councillor Richard Holmes has called into question the value of the Causeway Coast and Glens Gift Card Programme which promotes the ‘Shop Eat Enjoy Local’ message throughout the borough.
The project is designed to lock-in additional money for participating businesses and encourage local spend and increase footfall in the borough’s local towns.
At this stage in the scheme, which was set up in November 2019, the 222 businesses which have signed up to date are not charged to participate.
Since its inception until December 31, 2020, 574 cards with a cumulative sales value of £22,540 have been sold. However, 76 of those cards were purchased by council departments to a value of £3,580 for competitions, prize draws and marketing purposes.
The cumulative running costs as of December 31, 2020 are £19,481.51 which sees the scheme operating at a loss.
Since Christmas 2019, gift cards have only been redeemed 170 times to a total value of £4,161.11.
Speaking at the Leisure & Development Committee meeting, Councillor Holmes said: “When it went through council it was one of those things I thought was a nice idea but if you watch Dragon’s Den it is full of ‘nice’ ideas which aren’t commercially viable and I had that feeling about this.
“At the time we were told the setup costs were £22,000 and there would be very little to run the advertising to keep it going. The bit I couldn’t understand back then and the bit I still don’t understand how we break even, we don’t charge fees for it so I’m struggling to see how we are going to break even on this card.”
A council officer said: “You do make a valid point in terms of breaking even. We won’t see that for a while.
“In terms of ongoing costs – the setup costs were £11,500, in terms of the ecommerce platform and looking at the website we have annual fees of £5,500, we don’t charge the businesses at this point to actually get on to that system, which would be £25 to the business. I think from our point of view it’s important we get as many businesses as we can onto the scheme.
“We now have over 200 on the scheme and we have people wanting to come on board. Yes it’s vitality important that we keep our spend local.
“We do have plans for the future in terms of looking at the card as everything is now on line and we will be looking at adapting those cards with the help of Miconex so they can be ‘chip and pin’ going forward rather than the swipe card and there is an appetite right across the borough to take this on board.
“We do have those challenges in terms of making it break even. If members wish we can start and charge businesses to come on board but I do think that would be a backward step.”
Cllr Holmes added: “When this went through council we were told there would be a setup fee and the costs would be low beyond that. We were told that we would break even in costs over a three year period, that’s what we were sold on going through council.
“I don’t see businesses paying to take this on when they can get cash or cards handed over for free – that’s the problem with this, it is a nice idea that is not commercially viable.
“This is, to my mind, something that should not have gotten through council because it is not commercially viable but we are probably going to have to let it run for a period of time, for another year at least.”
The Causeway Coast & Glens Gift Card began in late November 2019 as part of a five year contract with Miconex.
There are five gift card programmes in Northern Ireland, three of which are managed by BID’s (Business Improvement District) and Antrim Town Gift Card is managed by Antrim & Newtownabbey Borough Council.