Setting up Christmas Savings club

quickstepqueen

I wondered if someone could possibly point me in the right direction?

I work for a small independent butchers and a customer asked us if we ran a Christmas Savings club. We don't, but my boss asked me to look into this to see if it's viable and if there are loads of pitfalls.

I've tried googling but just don't know where to look. I think my boss is a member of the federation of small business - would they help?

Unfortunately I am just a lowly employee who manages to use the internet (unlike my un-techie bosses) so I get lumbered with these tasks I have no idea about savings clubs. Apparently this said customer had been part of a christmas club with a butchers where he used to live, has now moved to our town and likes our meat, but for him a savings club would be beneficial.

I'm just anticipating loads of pitfalls, such as customers saying they're entitled to more than they are, customers paying in for a few weeks then never redeeming their money (how long do we hold onto it etc.)

If someone can point me in the right direction I'll be very grateful

paulwf

I've done it before, it can be easy to set up. Just design a simple grid on a spreadsheet, one column for date, another for amount, then staff initials and customer initials. Print out these blank grids and put them in a folder.

Set up a department on the till for deposits (exact details will vary by till system) and every time a customer makes a payment print out a duplicate receipt and staple it to the back of the form so you have a record if there is a dispute.

In the industry I was in there was a very big divide. In affluent areas Christmas club schemes have died out completely, there seems little point when credit cards give up to 60 days interest free. Plus I wouldn't have though a meat bill could be all that large. On the other hand in poorer areas they seemed to make or break the Christmas for the retailer so they were essential.

paulwf

paulwf wrote: »

I've done it before, it can be easy to set up. Just design a simple grid on a spreadsheet, one column for date, another for amount, then staff initials and customer initials. Print out these blank grids and put them in a folder.

Set up a department on the till for deposits (exact details will vary by till system) and every time a customer makes a payment print out a duplicate receipt and staple it to the back of the form so you have a record if there is a dispute.

In the industry I was in there was a very big divide. In affluent areas Christmas club schemes have died out completely, there seems little point when credit cards give up to 60 days interest free. Plus I wouldn't have though a meat bill could be all that large. On the other hand in poorer areas they seemed to make or break the Christmas for the retailer so they were essential.

In this instance my instinct would be to hold off introducing a scheme until several people ask, perhaps look to spread payment through November and December only. You don't want to attract the people that want to pay £1 a week for 50 weeks, it will be too much hassle for a small business.

Edit: hit the quote instead of edit button, it's been a long week at work

Savvy_Sue

It would certainly be worth putting up a poster to say you are THINKING about it, and to say if you might be interested, although I'd treat the numbers expressing vague interest cautiously.

FSB might well be able to offer advice, no harm in asking them.

You might want to have two cards, one to keep in the shop and one for the customer, so they can see at a glance what they've got. Use the business stamp on their card, but have a clear note to say that the record kept at the shop is final! Stapling the receipt to it is a good plan.

Horace

The Federation of Small Businesses will be able to advice on the legalities of it all.

I think that most printers can print cards for Christmas Savings Clubs - I seem to recall that the printers that I use can print off card for the purpose..https://www.printing.com

quickstepqueen

Thankyou so much for all of you who have replied. I will take all of this information back to my boss and see what he thinks. I'm still a bit anxious about the prospect of taking people's money each week. I guess we'd have to include some terms such as the money can only be redeemed in the shop, and not just use us a personal savings account. I personally think that it could be more hassle, more time and cost consuming than we want, especially as to date we've only had 2 enquiries.

We recently started offering gift vouchers (which we were concerned about but has gone very well to date) so I guess if people really want to save up weekly they could just buy £1 gift vouchers from us each week.

Thankyou for your replies. I think I'll suggest my boss contacts the FSB first to see what assistance they can offer (though I have a feeling he'll only delegate that back to me! LOL)

qsq x
BTW you've be surprised how much people spend at christmas! A bill of £50+ is most definitely not uncommon!

dezzy31

This is a very simple straightforward service to offer, and your boss will fint it will benefit his business more in the long run. All you need is a pack of ordinary payment cards and a note book. Advertise your savings club early and let people know they can invest anything from £1. Give the customer a payment card and put a reference number on it, then put this number in your note book, (keeping in numerical order for easy access).
Each time the customer pays mark both the card and book.

Also make the customer aware that if they cancel at anytime you will refund all there money minus say 10%, this is legal.

This means customers will save and buy there meats from your place. When a customer buys meat just minus the amount from there card and give them the meat.

Savvy_Sue

One thing your boss does need to do is make sure that his accounting procedures are clear, so that he knows what is 'saved' and doesn't spend it early!

Same with the Gift Vouchers, if you find you sell lots and they are suddenly all redeemed at Christmas, the cashflow may get 'interesting' if the money taken on vouchers through the year has gone out buying new carcases through the year, but suddenly there's £100 in vouchers in the till rather than £100 in crisp £10 notes.

Does that make sense?

Of course if your boss has a savings account paying any interest at all, then that's where all voucher / club money should live until it's redeemed! Then a £10 voucher 'spent' should mean £10 coming out of savings and into the current account.

quickstepqueen

Thankyou dezzy31 and Savvy_sue for your further replies. I didn't think I'd get much response from my request but you have all been wonderful. All of your comments make sense.

It sounds easy enough to start up (and I can easily devise a spreadsheet form or make some headed savings cards) but I guess I was worried about some of the legalities and pitfalls e.g. if someone pays in but then never redeems (forgot/died), how long do we hold that money for? Should we take customer contact details just in case, do we need them to sign any small print/disclaimer type things or have that printed on the back of their card?

I've yet to see the boss to discuss this so all your comments have been very helpful. It will help me to better explain it to him.

Thankyou all once again. I'll let you know how I get on.
qsq x

Savvy_Sue

I'd say that yes, keeping customer details would be a good idea (but very securely, not just in a book by the till), and also a reasonable limit on the most that anyone can save, which might need reviewing every year. But do check with the FSB, you don't want to run into money-laundering regulations (and I'm not entirely joking about that!)

quickstepqueen

Savvy_Sue wrote: »

But do check with the FSB, you don't want to run into money-laundering regulations (and I'm not entirely joking about that!)

Thankyou....The setting it up bit sounds straightforward but we do need to carefully consider any pitfalls and potential problems beforehand. I'm the sort of person to check everything to the nth degree as I'm always concerned I'll be ripped off, even those remote possibilities such as money laundering! I shall see the boss tomorrow all being well and we'll take it from there.

Thanks again.