Swapping of gift cards seen as a risky business

Filed under: Retail |

Consumers often turn to cyberspace to sell or swap unwanted gift cards. This method gives consumers an opportunity to find a better deal than buying the card from a traditional store.

Sites like swapagift.com, cardavenue.com and plasticjungle.com have all reported a surge in traffic during the last year.

The Web sites charge users a fee of about $4, or a portion of the cards’ value, to list cards to sell or swap. Plasticjungle.com has waived its fees and shoppers typically log on to a password protected site and then post a description of their card with the remaining balance.

The National Retail Federation expected shoppers to spend $24.81 billion for gift cards this holiday season, up from $18.48 billion last year.

Still, many shoppers are nervous about buying gift cards from the secondary market. According to a survey conducted by Accenture, 60 percent of respondents said worries about fraud would prevent them from purchasing a previously owned gift card from a source other than a known retailer.

Card-swap sites say they have security and verification measures to protect swappers, but the NRF suggests the safest way to purchase a gift card is to buy directly from a retailer.

Ethnic food sales rising

With the growth of ethnic groups in the United States, the sale of ethnic foods is also on the rise. According to A.C. Nielsen, Asian and Hispanic frozen entrees showed the highest growth.

Data reveals that during the year ending Nov. 4, total retail sales of Asian foods (excluding Wal-Mart) rose by 4.5 percent, to $1.1 billion. Sales of Mexican foods continued a four-year rise to reach $3.2 billion, up 3.5 percent from a year earlier.

A.C. Nielsen research shows that tortillas remain the most popular product. Sales rose four straight years, and culminated in a 4.3 percent climb to $1 billion during 2006. Salsas and sauces ran a close second at $945 million, up 2.8 percent from the previous year. The largest contributor to Asian sales continues to be one-food frozen entrees.

However, the two-food frozen entree segment in the Asian category has doubled in size since 2002, up 21 percent to almost $88 million last year. In the Mexican category, the same segment was up 36 percent, to $30 million, compared to a year earlier.

According to U.S. Census Bureau data, there are 14 million Asians and 41.3 million Hispanics living in the United States. Asians are forecast to account for 8 percent and Hispanics 24 percent of the nation’s 394 million residents by 2050.

A.C. Nielsen reports that the Asian and Hispanic populations are the fastest-growing U.S. ethnic groups and constitute the biggest drivers of ethnic food retail sales.

Low-glycemic sales top $1B

Low-glycemic foods and beverage sales are on the rise, with year-end totals expected to reach $350 million, according to market research firm Packaged Facts in its report “Low Glycemic Index Food and Beverages in the U.S.”

Low-glycemic products target the more than 20 million diabetics in the United States, in addition to consumers concerned about boosting their energy level and losing weight.

According to Packaged Facts, sales will keep growing at a compound annual rate of more than 45 percent from 2007 to 2011, with sales projected to hit $1.8 billion in 2011.

The awareness of carbohydrates effects on the body is driving sales, particularly those of food bars and beverages, which account for 90 percent of the current market.

“Low glycemic foods and beverages have made it out of their corners in health food stores to become a widely accepted addition to supermarkets, mass merchandisers and drug stores where they are often double marketed with like foods as well as in the diabetic supplies aisle,” said Packaged Facts publisher Don Montuori.

The report is available at Packagedfacts.com and MarketResearch.com.

New shredder on tap

The Monument UPS Store, located next to Safeway at 590 Highway 105, has added a self-service shredder to help local businesses and individuals prevent identity theft, said Amanda Verrie, president of RealTime Shredding.

Identity theft is the fastest-growing crime in the United States, according to the National Crime Prevention Council. More than 9.3 million Americans were the victims of identity theft last year, resulting in losses to individuals, businesses and government of $52.6 billion.

The shredder, developed by Colorado Springs-based RealTime Shredding Inc., cross-cut shreds paper, cardboard, credit cards, paper clips, staples, CDs, DVDs, and floppy disks. The cost is $1 per two-minute session.

The industrial-strength shredder can shred up to 200 sheets of paper a minute.

U.S. chain store sales

As the 2006 holiday shopping season neared its end, U.S. chain stores reported a 1.6 percent increase in sales for the seven days ended Dec. 16, according to International Council of Shopping Center’s index. On a year-over-year basis, the pace of sales growth slowed to 2.4 percent.

U.S. chain store sales saw a 2 percent increase for the seven days ending Dec. 23 according to ICSC’s index. Year-over-year sales ended up 1.7 percent, slightly lower than expected.

Same-store sales for December and combined November and December look to be at the low end of ICSC’s predictions of 2.5 to 3.5 percent.

Joan Johnson covers retail for the Colorado Springs Business Journal.