One local computer store expecting a big boost in sales as a result of the weekend’s statewide sales tax holiday.
President Mike Austin said his computer business generates an entire month’s worth of revenue in just two days. Austin said the state-sponsored event provides a significant financial boost to the company without the typical monthly overhead costs.
“Because it’s something that the state of Tennessee has done for us and I’m sure it’s a real blessing to the community and to the individuals, but it’s also helped our business so much,” Austin said.
Austin said the business prepares for the influx of shoppers by stocking up on popular computer models a month in advance. Austin said the goal is to have enough inventory to match a standard month of sales to ensure operations run smoothly for the high volume of customers.
“We find some of the computers in our showroom that we feel like that we can also discount, not just not have to collect sales tax, but we take $100, $200, $300 off some of them, so that maybe even more in some cases, so that they’re on sale as well and you don’t have to pay sales tax,” Austin said. “So it’s kind of a double benefit that way.”
Austin said customers often begin mentioning the holiday a month before it begins, with many choosing to delay their purchases to save money. Austin said while those with immediate technical failures often buy replacements right away, those looking for upgrades frequently wait for the tax-free window.
“But if someone is like, ‘it’s about time for me to upgrade, I’m still running,’ and they see that they’re getting close to sales tax holiday, often our customers are telling us often that they are just going to limp along until sales tax holiday and then they’ll be able to save money on their computer purchase,” Austin said. “Oh, they’re smiling and saying, ‘I’m here to get a computer on’ I bet they’re saying, ‘I bet that a lot of people are saying I’m here for sales tax holiday, I’m here because of the no sales tax.'”
Austin said approximately half of the shoppers during the weekend are purchasing equipment for students heading back to school or college. Austin said the business increases its advertising during this period because customers recognize the state’s lack of sales tax as a guaranteed saving.
“We do a little bit of extra advertising to make sure that people know about this opportunity, because the way that we look at it is if we offered 10% off, people would wonder ‘yeah, but how much did you mark it up?'” Austin said. “But when we tell them that the state is not collecting sales tax from them during this weekend, they know for certain that that’s money in their pocket.”
Austin said the business has operated for more than thirty years and relies on a customer base that is roughly 50 percent repeat clients.
“We love it because not only are they getting a good deal, but we’re tickled to have them as a customer because we’re going to try to do our very best to take good care of them,” Austin said. “We feel like that it’s just a win-win for them and us.”
