Associated Press
Tired of waiting for spending to rebound on its own, retailers are taking matters into their own hands. Stores like Sam's Club, Target, Toys "R" Us, Staples and Office Depot are offering unconventional promotions meant not only to attract visitors to stores, but also to get them feeling profligate.
Sam's Club is introducing a program in which it facilitates loans for shoppers of up to $25,000, backed by the Small Business Administration. Target will give its credit card holders 5 percent discounts. Toys "R" Us offers a holiday fund program in which it adds to shoppers' savings, and Staples and Office Depot are giving away office products for a penny or at no cost.
"A lot of the government programs have come to an end," said David Bassuk, a managing director in the global retail practice at AlixPartners, a financial consultancy. "So retailers are taking it upon themselves to do everything they can to get the consumer to spend, even opening up their own wallets to give money back to the consumer."
Of the over-the-counter stimulus plans, the one at Sam's Club is the most unusual.
Sam's Club began testing the program in May and will soon start marketing SBA loans of $5,000 to $25,000 for its members nationwide. Superior Financial Group, which is managing the loans, gives Sam's Club members a $100 discount on the application fee and lower interest rates because of how much business it expects to get through the arrangement.
The company says it does not expect the program to be a big moneymaker, though it earns $50 for each financed loan. The point is to get customers spending more freely -- and, it hopes, spending at Sam's Club.
Michael Golata was someone who had been watching his spending carefully. As a contractor in Louisville, Ky., for United Parcel Service, he drives emergency medical equipment to hospitals when MRI or CT scan machines break down.
When he asked UPS if more routes were available, the company told him there was so much work that he should bring on as many drivers as he could afford. There was just one problem: Golata owned one truck, and he was driving it all the time. Online, he had found a used white Dodge Sprinter for $12,500. With just a few thousand dollars in cash, he tried to get a bank loan but was denied. Golata, a Sam's Club member, clicked through the retailer's website and found a page describing SBA loans offered by the retailer. He filled out an online application, and, by the next day, got a phone call from Superior Financial telling him he was approved for a $10,000 loan, with an interest rate of 7.25 percent over 10 years.
Other retailers are taking slightly different routes to economic recovery. Beginning in the fall, Target will offer holders of its Target-branded credit and debit cards 5 percent off every purchase.
Toys "R" Us is asking consumers to create a sort of grown-up piggy bank, and put money into a holiday fund that can be spent only at the toy store. Toys "R" Us will add 3 percent to the account's balance in mid-October.
Office Depot is practically giving away products. Trying to lure back-to-school shoppers, it will soon sell some supplies, like glue sticks and scissors, for less than $1.
Staples is offering several products for a nickel or a penny.
Sam's Club is introducing a program in which it facilitates loans for shoppers of up to $25,000, backed by the Small Business Administration. Target will give its credit card holders 5 percent discounts. Toys "R" Us offers a holiday fund program in which it adds to shoppers' savings, and Staples and Office Depot are giving away office products for a penny or at no cost.
"A lot of the government programs have come to an end," said David Bassuk, a managing director in the global retail practice at AlixPartners, a financial consultancy. "So retailers are taking it upon themselves to do everything they can to get the consumer to spend, even opening up their own wallets to give money back to the consumer."
Of the over-the-counter stimulus plans, the one at Sam's Club is the most unusual.
Sam's Club began testing the program in May and will soon start marketing SBA loans of $5,000 to $25,000 for its members nationwide. Superior Financial Group, which is managing the loans, gives Sam's Club members a $100 discount on the application fee and lower interest rates because of how much business it expects to get through the arrangement.
The company says it does not expect the program to be a big moneymaker, though it earns $50 for each financed loan. The point is to get customers spending more freely -- and, it hopes, spending at Sam's Club.
Michael Golata was someone who had been watching his spending carefully. As a contractor in Louisville, Ky., for United Parcel Service, he drives emergency medical equipment to hospitals when MRI or CT scan machines break down.
When he asked UPS if more routes were available, the company told him there was so much work that he should bring on as many drivers as he could afford. There was just one problem: Golata owned one truck, and he was driving it all the time. Online, he had found a used white Dodge Sprinter for $12,500. With just a few thousand dollars in cash, he tried to get a bank loan but was denied. Golata, a Sam's Club member, clicked through the retailer's website and found a page describing SBA loans offered by the retailer. He filled out an online application, and, by the next day, got a phone call from Superior Financial telling him he was approved for a $10,000 loan, with an interest rate of 7.25 percent over 10 years.
Other retailers are taking slightly different routes to economic recovery. Beginning in the fall, Target will offer holders of its Target-branded credit and debit cards 5 percent off every purchase.
Toys "R" Us is asking consumers to create a sort of grown-up piggy bank, and put money into a holiday fund that can be spent only at the toy store. Toys "R" Us will add 3 percent to the account's balance in mid-October.
Office Depot is practically giving away products. Trying to lure back-to-school shoppers, it will soon sell some supplies, like glue sticks and scissors, for less than $1.
Staples is offering several products for a nickel or a penny.
