The check may be in the mail, but supermarket retailers hoping to receive a back-to-school sales hike due to tax rebate checks may not see those extra dollars go to their cash drawers.
While big-box stores like Kmart, BJ's Wholesale Club and Ames Department Stores have created promotions specifically for the federal rebate checks, other retailers and analysts had mixed views on the effects of Uncle's Sam's helping hand.
One co-operative wholesaler source in the South said back-to-school spending dollars will be a positive boost. "The refund checks aren't enough to go out and buy a car, but it's enough to go out and buy extra groceries and school supplies," he said. "We anticipate on having a big back-to-school year because of them."
However, not everyone expects the windfall to go to food retailers, and analysts do not expect them to specifically promote the $300 to $600 tax rebate checks.
Sarah Scheuer, manager, industry media relations, National Retail Federation, Washington, said "[the checks] are a moving target -- not everyone will get the same amount or get them at the same time, or even get them at all."
She said grocers will go with their planned back-to-school promotions, while retailers that focus more on financing or clothing will also center their promotions more on the tax refund checks.
Burt Flickinger, managing partner at Westport, Conn.-based Reach Marketing, agreed. "The checks will certainly help spending in back-to-school, but most tax refunds will go toward paying down consumer debt and going toward bigger purchases," he said.
In addition, he said, only 30% of the tax refund dollars will be in consumers' hands during this back-to-school season.