There are many ways to save a dime while spending. One of the ways I consider most efficient is using “pre-paid” vauchers, so that the price you pay for the voucher is significantly less than it’s face value.
Why? It’s a win-win situation. The vaucher is valid only at a certain place, so the merchant has secured your business, without providing you anything yet. The merchant got (most) of the money which you’ll end up paying anyway, but upfront, thus improving the cashflow without reducinig the stock.
You on the other hand got a discount (the difference between the face value of the voucher and the actual value you paid for it), which you otherwise wouldn’t get, and ensured that when you really need to spend money at that merchant’s – you don’t actually need to worry about spare cash in your wallet, you have already paid.
I use this method from time to time, it’s very common in some areas (such as travel and lodging, or some retail gift cards that can be bought at discount), and less in others. Let’s take a closer look at one particular area, restaurants. And one particular vouchers’ provider – restaurant.com.
Restaurant.com provide discounted (and sometimes not discounted) coupons to various restaurants. In our case we got a $25 value coupon (which costs $10 on the site) to one of the restaurants we wanted to go, hoping for some savings.
The first impression is that we have $15 savings – plain and simple. Little did we know. The fine print states several things:
1. One certificate per table, cannot be combined. Ok.
2. Minimum purchase is $50. Hmmmm…. Not a cheap restaurant, but still we need to eat a lot to get to $50. So it’s not for a couple.
3. 18% will autiomatically be added. Wow. That’s double the sales tax, we usually tip that if the service was really good, not by default.
4. On the vaucher there was a big-letter writing “Don’t forget to tip your server”. Wait, what are the 18% for then?
5. Once applied – the voucher cannot be refunded.
18% of $50 is $9, plus $10 the voucher costs, the discount reduced from $15 to at most $6 just by the fine print. Obviously, the dinner was more than $50 (since for a couple it’s too high a limit, we used it when we went with a couple of friends, as we frequently do), and the result is that because of the fine print we ended up paying $10 more than we would have paid without the “discount”.
So people, when you get your coupons and vouchers – read the fine print and do the math. Sometimes, when you think you’re getting a discount – you end up paying more.
As to Restaurant.COM – I’m not using their services ever again.
Your little advisor.