💳 How can gift cards help your business make money?

Alex Hormozi explains how Starbucks gets money from gift cards. Customers buy gift cards and loan money to Starbucks. This helps Starbucks use money before customers spend it. It is smart for businesses.

🎁 Gift cards create immediate cash flow.
- 📊 Leverage customer funds for investments.
- ⏳ Understand the profit vs. redemption timeline.

Gift Cards: Starbucks' Billion-Dollar Strategy

In the video "Starbucks Made $1.7B From This One Thing" from Alex Hormozi, he discusses how Starbucks was able to get thousands of everyday people to loan them $1.7 billion to do whatever they wanted with it. Do you know how they did it? They offered them gift cards. When you buy a gift card, you essentially loan money to a business. That business can take that money, invest it, and do other things with it in the meantime before you redeem it. When you buy a gift card, you're not even really giving them that much money that they will have to spend on you; you're giving them that much money in gross profit that they'll spend later. For example, a $100 gift card to Starbucks might only be $5 in actual cost for them. Therefore, they can immediately take that money and use it. They can even sit in a treasury and start making interest on your money. No matter what, if you're a business, offering gift cards is one of the smartest things you can do, and that's why there are laws around them because they're so powerful.

Gift cards are a hidden goldmine for businesses. When customers buy them, they essentially fund your operations upfront. Use that capital wisely, and your business can thrive without debt.

By incorporating gift cards into your business model, you can boost cash flow and attract new customers. Alex Hormozi highlights how gift cards allow companies to leverage funds before they are redeemed, serving as an effective marketing tool and an additional revenue stream. When customers buy gift cards, they essentially provide a loan to your business, enabling you to invest that capital immediately. Hormozi’s insights illuminate the strategic and financial benefits of integrating gift cards, showcasing their potential to significantly enhance profitability.

Now, share your thoughts on how you think gift cards could impact revenue in your business model in 25 to 100 words in the comments below! Remember to engage by replying to 2 comments and liking 3 other valuable insights shared by your peers.

Gift cards help businesses grow and thrive in exciting ways. 🌟

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