The Deal Economy - Page 7 - Enable

Special Pricing Agreements (SPAs) are often considered a necessary evil in most industries. Whilst they can assist you and your trading partners in winning business over your competitors and allow you to enter new markets, the accompanying complications of managing SPAs can leave you wondering if they’re really worth it. Some businesses we have engaged with wish to cease dealing with special pricing agreements due to the burden of managing them! There is no doubt that special pricing agreements...Continue reading

We learn about collaboration from an early age. As children we quickly learn that we need to collaborate with teachers, classmates and team players in order to be successful. "There's no 'i' in 'team' is a common mantra in sports and work teams. And "supply chain collaboration" has been a hot topic for decades. Despite that, there are very few systems that enable wholesale distribution companies and their suppliers in the building materials industry to truly collaborate on their trade agreement...Continue reading

Rebate Management refers to the management of discount claims that are based on volumes of purchases over time. To some companies, that rebate is treated as a bonus. But to others, rebates form a significant proportion of their revenue and for these companies accurate management is absolutely essential. What is a rebate? Rebates were “invented” as a way of driving sales growth without simply reducing the contract price. By agreeing retrospective financial incentives based on actual sales, both...Continue reading

We have witnessed a huge volume of merger and aquisition activity over the years, there were 1,560 recorded deals in 2018 valied at 182.6 bbillion compared to a whopping 6500 mergers and acquisitions were completed in the UK in 2015 with a total value of £433bn. Fast forward to today and merger and aquisition deals have totalled $42.9bn (£35bn), down 69 per cent on the same time last year, according to data from Refinitiv. But despite the large drop in value, the number of deals has fallen only...Continue reading

SPAs (Special Pricing Agreements) are a common vendor program in many industry sectors. The program gives a special product discount for verified sales to an ultra-competitive event where in-stock discounts can’t secure the order. Special pricing agreements trace their roots back to the 1970’s but have shown significant growth in the past decade. As B2B e-commerce now counts for an estimated 15% of all orders and grows at 8% per year, special pricing agreements have grown significantly as price...Continue reading

Vendor monies that support reseller sales are big business. US-based research conducted in October 2018 estimates that, at top performance levels, distributors, dealers, and retailers use $600+ Billion (USD) in vendor funds. Projections from the EU find that approximately €500 Billion (EU) in vendor funds are similarly spent. These funds are found as four primary types including: SPAs — Special Pricing Agreements used by sales to compete with a competitor’s special pricing to a customer MDF --...Continue reading

Rebates, SPAs, claim-backs, contract support are all very similar and at the same time quite different to each other. In essence they are all terms for the money that wholesalers claim from suppliers and manufacturers for selling their products. Some of the key differences lie in how the agreements are formed, whether goods are actually ever handled by the wholesaler, and how the claims are made. Collectively, they are sometimes referred to as “vendor monies”. It is estimated that, annually, the...Continue reading

Companies tend to look for specialist rebate management software when they reach a point where their core business systems are proven to be inadequate. This particularly affects builders' merchants, plumbing distributors, electrical distributors, HVAC distributors and others who operate in the building materials industry. These businesses usually have to deal with a large number of complex trading agreements involving rebates, special pricing agreements, retrospective discounts, over-riders and...Continue reading

Whilst working with a number of organisations across industry sectors such as building materials, buying groups and wholesale and distribution, we have seen a large variety of very complex supplier rebates and trading agreements. These very often involve incredibly complicated performance-based calculations with seemingly endless permutations, and on top of that rebate agreements are subject to periodic review and change. In the building materials sector for example, there are further complicati...Continue reading

If you’re a builders merchant you’ll know how essential it is to ensure every penny counts in terms of your bottom line. So, it’s even more crucial than ever that you don’t miss out on any of the, often significant, sums due to you through rebates. Indeed, profitability for building materials suppliers is often very closely dependent on the amount of rebate they can negotiate and claim and many businesses across this sector tell us that the sheer volume of categories and the complexity of rebat...Continue reading

Failing to claim 100% of rebate due can have a large negative impact on the bottom line for businesses in industries where rebate agreements are commonplace. Finding out why that happens and how to stop missing vendor rebate claims is at the forefront of the minds of rebate accountants and financial leaders all over the world. Some ERP systems have functionality for recording rebate agreements, but often lack the granular level of functionality needed to carry out detailed matching of actual pu...Continue reading

Contracts are core to any business activities, regardless of size, industry, and region. They set out the prices, service levels, terms and supplier relationship and ensure that your company is regularly supplied with their direct and indirect supplies. A study by the Institute for Supply Management uncovered that between 60-80% of all business-to-business transactions are governed by some form of written agreement, with a typical Fortune 1000 company maintaining 20,000 to 40,000 active contrac...Continue reading

In our experience, many businesses that receive rebate revenue from suppliers, don't have the means to be able to check that it is correct. They are completely reliant on suppliers to accurately calculate and make the payments. Because they tend to record rebate agreements outside of their financial system, these businesses are unable to match the cash received against amounts owed from their rebate deals, and for that reason they don’t set up a debtor in the same way that customers are treated....Continue reading

When people ask us about integration, the answer is simple. Enable can accept data from anywhere so long as it is detailed enough. We aren’t tied to any particular ERP systems or EDI providers, and we have over 20 years integration experience. There probably isn’t a system or standard that we haven’t come across already. The bottom line is that if you have line item data on goods received, purchase orders and supplier invoices somewhere in your digital infrastructure, then you are ready to im...Continue reading

This business had used a bespoke system to manage rebate earnings for some time, but rebates were calculated at a very high level and were based on data provided by suppliers rather than their own data. They reviewed the situation and estimated that by making calculations at a more granular level of detail, they could significantly increase the level of rebate claims within the existing deal structures. They moved to Microsoft Dynamics AX for their core financial system, but it was clear from th...Continue reading