As small businesses shutter, your gift cards are time-sensitive

Gift cards you received over the holidays may only have value for a limited time, as so many retailers face bankruptcy and economic uncertainty.

Many San Francisco businsesses, from independent bookstores to gyms, salons, and restaurants, are struggling to stay open. 

Arlene Cook owns Leenie Rae Boutique, a women's retail and home goods store in San Francisco's Richmond district. Last month she lost over half her holiday business.

"Last Decmeber we made a little over $52,000. This December we made a little over $20,000," Cook said, noting she has been operating at limited capacity since the city instituted another shutdown in early December.

She sold a handful of high value gift certificates that have not been redeemed yet, and she hopes shoppers use them sooner than later.

"I would say that there's a lot of urgency," Cook said, adding that she's concerned for the future of her business.

Rory Cox, founder and president of the San Francisco Small Business Alliance, says the local small business landscape is shrinking fast.

"You're going to see a lot of businesses closing in the few weeks, few days," Cox, who owns YuBalance fitness studios, said. "I would say that if we're lucky at the end of these lockdowns we might have 15 to 25 percent of our small business community remaining," Cox said.

Green Apple Books is one of the lucky ones, with loyal customers shopping online and in their three San Francisco bookstores. Co-owner Pete Mulvihill says gift cards kept them afloat when the bookstores were forced to temporarily close last March.

"We sold a ton of gift cards, especially when we closed, it was almost like a fundraiser, almost like a GoFundMe, with people saying, 'I believe in you Green Apple, I want you to be there three months from now, six months from now, a year from now," Mulvihill said.

If you have a gift card to a retailer that has already gone out of business before you had a chance to use it, money savings expert Andrea Woroch says to hold onto them, they're not worthless.

"You may have the opportunity to file a claim and this would be reviewed by bankruptcy court and you could potentially get paid out the full value of your gift card, " Woroch said.

"Hold onto your gift card until the bankruptcy filing is paid out. It's not a guarantee but it's definitely an option," Woroch advises, adding that gifters should send proof of purchaise receits to the recipient of the gift card so they can file that claim.

And if you have a gift card you want to exchange to shop somewhere else, Woroch suggests visiting websites like Gift Card Granny or will let you exchange a gift card or trade it in for cash, and take home 92% of the value.