Retailers hungry for tax-free weekend revenue

Stephanie Myers-News Herald

Though Loudon County students may be dreading summer's end, local businesses are feeling just the opposite as they prep for a revenue boost from next weekend's tax-free holiday.

Shoppers across the state will take a nearly 10 percent break on clothing, school and art supplies and computer purchases Friday through Sunday for the seventh annual tax-free event. Big-chain retailers and small business owners alike are confident the incentive will bring much-needed sales.

"Typically for the retail business, August is a slower month, so it made a tremendous difference," Gail Edwards, owner of Chic Boutique in Loudon, said. The holiday brings "at least" 40 percent more traffic throughout the August weekend, she said.

Business was hopping for the consignment shop during last year's tax holiday.

Though the Chic Boutique offers the same savings, and sometimes even higher at 15 percent off throughout the year, the "tax free" psychologically drives customers through the doors.

"It has become so popular," she said.

Jim Brown, state director of the National Federation of Independent Business, said the tax holiday will be a big help to families and small businesses still recovering from the recession.

"The sales tax holiday is like the day after Thanksgiving," Brown said. "It gets people fired up and in the mood to shop, and that's exactly what our economy needs right now."

The weekend is geared toward giving students and their parents a tax break for school supplies.

"What we are mainly getting is moms and grandmothers that were already out and about shopping because so many stores run the sales. So, they were already out and about and they came to see us as well," Edwards said.

Chic Boutique will run a summer clearance sale at the same time.

"(It's) mainly because of the traffic it brings in, and usually this time of year you do your clearance," Edwards said. She hopes the coincidence helps.

In its first year of business, children's consignment shop Lollipop Lane hopes its array of clothing, shoes and backpacks will be a bit hit next weekend.

"We are pricing right now, trying to get out some of our winter and fall items," owner Stacy Lawson said.

It may be tough competing with big retailers like Walmart, but Lawson hopes it gives consignment shops a leg up. "Of course, we have better prices than Walmart would have," she said.

The downtown Lenoir City business is now offering buy one, get one half off deals leading up to the tax-free weekend. They also offer hairbows, baby items and strollers.

Though those items are exempt from the tax-free incentive, Lenoir City Cato store manager Kim Wallace welcomes the weekend to be that extra nudge to sell accessories.

"No matter what outfit they get for school, we have some really nice purses and wallets to match that," Wallace said.

Cato is offering layaway options during the weekend. All the factors leading to a profitable weekend seem to be stacking up on the retailer's side.

"Now that being the weekend and everyone saves up for that I'd say we're pretty much going to probably double (in foot traffic)," Wallace said.

Though Loudon County is limited on brick and mortar retailers compared to Turkey Creek, Wallace and Lenoir City Walmart store manager Donnie Wells believe many shoppers will stay in the county.

"They somewhat go outside of the county, I guess, because we're limited in what we can carry here versus what JCPenney or others can carry," Wells said.

But Loudon County offers unique incentives.

"Many local people don't want to go fight the crowd. We are more convenient for the town. It benefits them to save on gas and shop here locally," Wallace said.

The tax-free weekend isn't as crowded or brings in as much revenue as Black Friday, but Wells said the local Walmart still is pleased with the 25-30 percent increase in foot traffic that is spread over three days.

"It gives people more opportunity to shop over a broader time range," Wells said. "You have some customers that just go ahead and get it (school supplies) now, but families that have three or four kids in a family that can save a significant amount of money."

Tennessee taxpayers saved nearly $9.6 million last year, according to Revenue Commissioner Richard Roberts.

The holiday begins at 12:01 a.m. Friday and ends at 11:59 p.m. Sunday. During the designated three-day weekend, consumers will not pay state or local sales tax on clothing costing $100 or less per item, school and art supplies costing $100 or less per item and computers costing $1,500 or less.