Surely someone is going to loose money or not make any money as the company with gift cards ( like microsoft )would loose money selling it discounted to the shop (like Tesco), and there would be no point the shop selling it for no profit. How does this work ?
In: Economics
Shops usually get a small percentage of the gift card sold as payment for their service. Say, if they sell a $100 gift card, they get to keep $2 and $98 goes to the gift card business.
It makes sense for the retailer, as there is almost no cost associated with selling the card, so it is almost pure profit (albeit small). It also make sense for the company offering the cards, as I would rather lose $2 of my profit on a sure-thing $100 transaction than have that transaction be less likely.
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