What is rebate management?
Rebate Management is the process of recording what rebate type applies to a customer or product, (sometimes referred to as a trade agreement). Rebates act as a loyalty incentive as they usually run over a time period which incentivises the buyer to stay loyal, in order to reach the agreed target and get the rebate owed to them.
However, e-Bate is more than just rebates, is a rebate and pricing management Software-as-a-Service platform, tracking monies that have a post invoicing impact on margin, such as commissions, bonuses, on offs, events and promotions, to name just a few and each sector refers to them in different ways.
The Pitfalls of not using a rebate management solution
Rebate management is often disjointed across the process, you have commercial and procurement teams negotiating rebates on behalf of the company which is often a paper and verbal process, and then they are passed to finance or a pricing function for management and collection. Many rebate management solutions are often Excel based which means:
No audit of the changes
No approval or workflow for changes
Delays in changes being communicated and updated into Excel
Delay in getting data from your ERP and into Excel to managing calculations
Discrepancies are difficult to identify or prove
Lack of visibility of data across the process
What are the benefits of using a rebate management solution?
The benefits of having an automated solution like e-Bate® is that you gain control and have full visibility, which delivers:
Create and store complex rebate agreements
Increased efficiency in the process which would be fully automated giving each role involved full visibility
Remove calculation errors that lead to overpayments and therefore impact profit margins
Allow global monitoring across your business and customer base, so you can see the real impact on margins at a product level
Increased transparency across all roles, improving decision making
Streamlined processes which can also include your buyers and suppliers
Ability to withstand scrutiny and audits due to every transaction being audited
Improved decision making through visibility of information on Dashboards and reports
What functions and roles do rebates affect?
Rebates affect many functions:
Board – establishing the business strategy
Commercial / Procurement teams – negotiating rebates and trade agreements with suppliers
CFO – financial performance and management
Pricing Teams – to understand and analyse the market price, and net price to allow the implementation of effective pricing strategies
Finance – managing the calculations, accrual and payments to ensure financial integrity
But generally, they work in silos as each function has a different objective. But collectively, rebates are there to ensure that the board delivers on its business strategy. However, if the process is disjointed and the information is delayed, can you really be sure what your financial position is?