Rebates are used to drive sales, essentially providing customers with incentives that encourage them to purchase more. In the B2B world, they present a fantastic opportunity to drive loyalty, brand affinity and help to build long standing relationships between buyers and suppliers.
However, managing buyer and supplier rebates is a complex process, especially when dealing with large volumes of agreements with complex rebate rules. An effective rebate management solution must manage multiple pricing schemes, provide full transparency into calculations, deliver fully-traceable audit trails and foster a well-managed authorisation process.
A good solution will also provide organisations with the ability to forecast outcomes and model future rebate agreements.
Surprisingly, many organisations still rely on spreadsheets for rebate management. This is an outdated practice – and one that was never really sufficient in the first place. Price changes, agreement changes, reams and reams of data – it’s all too much to maintain by hand on a spreadsheet, leading to inefficient processes and opening organisations up to the risk of costly errors.
So, what can organisations do to optimise their rebate management solution?
How to Stop the “I Like to Do It this Way” Conundrum and Ensure that Common Practices and Standards Are Followed by All
Old habits are hard to break – but when it comes to using spreadsheets to manage rebates, they must be broken.
Spreadsheets may be time-honoured, but they represent a manual approach to rebate management – an approach that is slow, complicated and error-prone. Such inefficiencies lead to inaccurate accruals and payment and unrealised earnings as you are missing buying behaviours. Often the spreadsheet in question is maintained by just one person, limiting visibility into calculations for all concerned parties, including suppliers, buyers and finance teams.
Centralised Accounting and Reporting Processes
Today, the most effective rebate management solution is to utilise purpose-built digital tools that streamline and automate processes, centralise accounting and ensure that common procedures and practices are followed by all involved in the supply chain.
Rebate management software collects and stores all contract data in a centralised, cloud-based location, enables deals to be monitored by all parties, and feeds back timely and accurate information to sales, purchasing and finance teams. Anyone with the right permissions can access this data from anywhere and at any time, giving everyone full visibility into all calculations and agreement terms, while eliminating reliance on cumbersome, mistake-prone manual processes.
Resolve the Bottlenecks and Streamline Processes
Approvals and authorisations are a crucial part of a rebate management solution. All agreements must be processed and approved at the right level, including any changes that occur. However, many organisations lack a system that defines roles and responsibilities for each stage of the process, resulting in bottlenecks, important tasks being missed and business integrity being compromised.
Automated Management Workflows
A robust rebate management solution solves these problems simply and effectively.
Rebate management software systems come with configurable workflow engines, which allow organisations to ensure that all agreements – and any changes to those agreements that occur – are audited, processed and approved by appropriate parties consistently and efficiently. Workflows can be configured to align with business rules and corporate governance, with automated reminders alerting relevant individuals whenever their actions are required. This ensures that all sign-offs take place in a timely fashion and that important actions and deadlines are never overlooked, or forgotten.
Go Paperless with Your Document Management System
Increasing focus on the climate means that more and more businesses are becoming conscious about their environmental impact. Pressure is mounting on organisations to improve their sustainability efforts and those that do are often able to attract more business from other companies who are similarly conscious about going green. Using a document management system and going paperless is one sure fire way to improve your green credentials, but research has found that it can also increase productivity, improve processing capacity and create quick access to vital documents while reducing storage space.
Compared to automated document management systems, paper-based processes are woefully slow and inefficient. The research shows that nearly two-thirds of office workers spend an hour every day searching for documents, reducing productivity and ultimately wasting time and money.
Automated document management systems reduce the amount of time and staff costs wasted on such tasks, while also reducing the risk of human error by eliminating the need for manual data input. In short, a paperless rebate management solution is not only beneficial to your sustainability efforts, but helps you become more effective, productive, streamlined and accurate in all your rebate management processes.
Model Your Way to Success
The complexities involved with buyer and supplier rebates are very difficult – if not impossible – to model in manual rebate management solutions such as spreadsheets. Organisations that rely on these systems to calculate and forecast the impact of rebate agreements leave themselves open to risks of inaccuracies, missed opportunities and supplier disputes.