Participating businesses offer discounts that residents can apply to their property taxes, while out-of-towners can get an annual check. Businesses bear the costs of the program plus discounts, however.
By Matt Skoufalos | November 21, 2016
Businesses in Haddonfield are rolling out a new incentive program designed to capture local dollars in the form of a tax rebate for property owners.
But with small businesses in the high-end Haddonfield shopping district shouldering the up-front costs of the discounts, the technology necessary to implement them, and a per-transaction processing fee, early participation is scattered.
Fifteen businesses so far have registered for the incentive program, and are offering discounts of 3.75 to 15 percent, with some limitations. (It’s also worth noting that none of the professional service businesses in the borough have signed on yet.) Shoppers pay the full total at the register, and a third-party processor, Fin Credit, directly debits the discounted amount, which includes a 2-percent service fee for each transaction.
At the end of the year, residents receive a property tax deduction equal to the total amount of their shopping discount. Out-of-towners and renters who register for the card can receive rebates in the form of a check, minus a $7 processing fee.
The Shop Haddonfield cards will be mailed to each of 4,107 Haddonfield households by early December, a cost absorbed by the Partnership for Haddonfield (PFH), which oversees the borough Business Improvement District (BID). Republic Bank contributed $10,000 to print and manufacture the cards.
PFH Retail recruiter Remi Fortunato said the program is intended to motivate Haddonfield residents to keep more of their dollars in the local economy.
“We don’t want to become a discount town, so this is a reward,” Fortunato said. “Everyone has a rebate program. The malls have them. To keep competitive with those areas and keep the customers coming downtown, we felt that we should jump on the bandwagon.”
Haddonfield Mayor Jeffrey Kasko said out-of-town shopping is strong, but he thinks borough residents can have an impact if they patronize local businesses more frequently.
“We’ve often talked, a lot of the retail businesses and store owners, about how we attract people from out of town, which is great,” Kasko said.
“But sometimes they feel like there’s not enough people who actually live in Haddonfield who also shop here.”
With a median annual property tax bill of $12,000, Kasko cautioned that the Haddonfield card isn’t a tax relief program by any means, but over the course of a year’s shopping, “it’s something.” After consulting with the Voorhees business community and municipal government, which has established a similar program, Kasko said organizers discovered “there’s really no downside.
“Whatever we can do to help is good,” the mayor said. “I think it’s just a matter of people learning more about how it works.”
JAX Boutique owner Jamie Gorczynski of Cherry Hill is offering a 5 percent rebate, which she said allows her the flexibility to combine Haddonfield card discounts with other sales she may offer.
“I see it as a way to get the Haddonfield residents in here and shopping,” Gorczynski said. “A lot of business owners are from Haddonfield. Those small amounts they do spend around town, they’ll see it add up in the end.”
Gorczynski also pointed out that shoppers can also register their phone numbers with the program for trips when they don’t have their cards on hand.
Kathy Gold of In the Kitchen Cooking School co-chairs the PFH Marketing Committee, which she said is charged with “creating the experience of downtown Haddonfield” through events programming, general advertising, and beautification.
If the local business district is to be more than a scenic backdrop to that small-town experience, however, it’s dependent upon a return on that investment.
“People love walking through town and they don’t know what’s here,” Gold said. “I’ve been here 10 years, [and] not a week goes by and someone asks me if I’ve just opened.”
Haddonfield business owners pay premium rents, ostensibly for access to high-income clients in a scenic walking district. Shop owners carry premium inventory with the expectation of reaching those wealthier consumers, and the expense of that investment means that any discounting necessary to entice those shoppers cuts purely into the profits they need to make to keep their doors open.
When customers who are accustomed to big-box retail sales apply that same thinking to independent retail, the math doesn’t wash.
“For years, I would never step foot in Macy’s without my coupon,” Gold said. “You never dreamed of paying full price. [But] small business owners really bear the brunt of having a sale as a way to entice shoppers.
“It’s wonderful that we’re creating opportunity for our residents to have a discounted value,” she said. “The downtown is always offering [sales] and we really hope that it does go both ways, which this will help.”
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