How does it work?

Do you participate in it?

ours gives you 10% for the year that you spend in your birthday month.

Most of my LQS's have punch cards with $10 off or 10% off after $150 spent

The one I use has a punch card and when filled you can use it for $20 of free stuff. It also will honor the JoAnn coupon on Tuesdays. Works out pretty good.

the LQS has a $25 cert for every $250 spent on non-sale items.

and this online shop has a frequent buyer program that i use

http://www.ericas.com/quilting/

Ours has a punch card when filled 20% off. Also 20% off during your birthday week (must be on their mailing list).

Our quilt shop send out coupons every month in their newsltr.

I have two LQS both about the same distance from my house. Niether has a frequent shopping program. And neither ever has a sale of any kind.
One of them the prices are up to 12.75 for most batiks and the Kaufman fabrics.
I do find it a bit of a "stone in my shoe" that after the years of patronage there is never any ... customer appreciation in the form a sale or program.... or even random act of appreciation. I have spent big $$$. So as much as I would like to support my LQS ... I have taken to the internet for a significant amount of purchases.
I am sure one of these days the owner(s) will see me in the store and comment "gee , its been awhile" . At which point I will tell them .. after all the years of purchases .... why do I still just feel like only a wallet when I walk -in.

I have one that does the punch card thing and another that gives a discount in your birthday month and sends out email coupons every so often.

Lori, don't they even have a clearance section?

I would think that every store, everywhere, has to have a clearance section. Otherwise, it would mean that their buyer always made PERFECT decisions! Gee, but that would be hard to do...