The Deal Economy - Page 7 - Enable

When it is done well, rebate management improves partner relationships, provides financial compliance and reduces audit risk, eases cash flow for customers, improves rebate accuracy and predictability and helps grow business through true partnerships between manufacturers and their customers. In the past: managing customer rebates was like playing telephone Unfortunately, in the past, managing customer rebates internally — never mind with external partners — was more like a game of telephone:...Continue reading

It may seem overly simplistic to associate the complex nature of financial accounting with a cup of coffee, but when it comes to customer rebate management this analogy makes intuitive sense for anyone who has ever tried to get a free cup of the caffeine-laced beverage. Rebates vs. discounts Rebates are similar to a discount. So what’s the difference between them? Discounts are typically applied at the point of purchase to reduce the buying price: when you get a bill you pay the discounted value...Continue reading

In this blog, we are going to focus on the system requirements for configuring, storing, monitoring, reviewing and operating rebate deals or special pricing agreements. For the sake of efficiency and audit tracking, and to avoid unnecessary disputes, all elements of pricing agreements should be stored in one place. A cloud based solution is ideal for multi-centred operations. Accessible for all The software should provide a central repository that (with appropriate security settings) is accessi...Continue reading

When it comes to modernizing business practices, technology in general and software in particular is essential for business growth. How are manufacturers and suppliers who deal with millions of dollars’ worth of customer rebates each month adapting to the challenges faced by a historic lack of suitable software? Andy James, Chief Product Officer at Enable, shared a few stories about how their clients have changed for the better and what drove their decisions. Essentially, for two of our largest...Continue reading

Rebate management is the process of recording supplier agreements, tracking purchases and sales against those agreements, and managing accruals and rebate claims in a timely manner.

Proper rebate management can be a headache for any business, regardless of the scale of their rebate programs. Often, whole teams are dedicated to using legacy systems to follow inefficient processes, reducing productivity and negating the intended benefit of the rebate agreements commercial teams have negotiated brilliant terms for.

For small to medium businesses, rebate can make up the majority of their profit and for large businesses even a small improvement in process can lead to the discovery of millions of pounds, therefore it’s essential for any company who are regularly involved in rebate to scrutinise their current rebate management process and consistently strive to improve.

8 min read

Rebates were “invented” as a way of driving sales growth without simply reducing the contract price. By agreeing these retrospective financial incentives based on actual sales, both the supplier and the distributor are working together to drive market share and growth. Rebates often act as either a reward for loyalty or as an incentive for increasing trade with a specific trading partner because the benefits of a rebate agreement tend to improve as trade with the trading partner increases. Rebat...Continue reading

In business, procurement and finance are two separate departments, working alongside one another within the organisation. The procurement function is about spending the money well and driving more for less from suppliers, and the finance team is all about keeping the balance sheet in check and driving profitability. While this relationship works for some companies’ others not so much, which isn’t the most efficient and effective way to handle business operations especially when vendor rebates ar...Continue reading

Customer rebates are what a seller pays to another business whether they’re a direct customer, an indirect customer, or a buying group. Customer rebates are a key contributor to the flourishing Deal Economy, which last year was worth $500bn in the US alone. The following blog outlines the challenges faced and some practical steps you can take to regain control of your customer rebate programs, and start maximizing their value to your business. What is a customer rebate program? Customer rebate...Continue reading

For any business to be successful, it’s vital that a profit is made enabling continued success and to provide opportunities for growth and development. But, making a profit isn’t always as easy as it may seem. Once all the necessary expenses and costs have been paid out, its then essential enough sales have been made just to break even, let alone have anything extra to realize a company’s ambitions.

Although this can be extremely challenging at times, it’s also possible to increase the profitability of your business by spotting opportunities. Collecting rebate agreements on time, consistently and accurately could be one of these opportunities. Rebate management is the process of recording supplier agreements, tracking purchases and sales against those agreements, and managing accruals and rebate claims in a timely manner.

5 min read

Finance and accounting departments tend to rely on Excel spreadsheets to manage a growing business’s financial data because they know it, they understand it and old habits die hard. But excel errors are always a risk, in fact various studies report that nearly 9 out of 10 accounting spreadsheets (88%) contain human errors. Moving forward to today, the use of accounting spreadsheets does appear to be in decline, according to a 2018 Benchmarking the Accounting & Finance Function report by Rob...Continue reading

Whatever industry you are involved in, forecasting the potential earnings for your business is essential in preparing for the ups and downs of the year ahead. Although a complex task, forecasting helps you make important decisions about your budget, such as how many employees you can afford to hire or how much you can spend on marketing.

You wouldn’t be able to make these decisions if you don’t know how much revenue and profit, you’d be generating, which is where forecasting comes into play.

Why is accurate forecasting important?

Accurate forecasting and accurate accruals are vital to success within your business to ensure that you are aware of what the future is likely to hold so that you can appropriately allocate resources to assist in key areas. Accurate forecasting also helps you reduce unnecessary spending, avoid missing potential opportunities and means you can manage your cash flow better.

For many businesses, forecasting is not a focus and even for those that make a point to forecast their future, various challenges can limit the accuracy and benefit of these financial forecasts.

Challenges of forecasting rebates

Businesses face several challenges when developing forecasts and can lose a lot of precious time in the forecasting process. It becomes even more strenuous when there is a lack of common tools and inconsistent approaches. With this in mind, let’s dive in to the four common challenges of forecasting rebates.

1. Many in-house forecasting tools are too basic.
2. Renegotiating the best deals in the future.
3. The forecasting process is too manual.
4. Forecasts are not updated throughout the deal.

8 min read

Sometimes both parties come out of a negotiating a contract feeling like they have won but if you think you won and the other party (your supplier or your customer) feels they lost, then it’s not really a good situation to be in. If the customer feels they lost, then maybe they might have stuck with you because they need to in the short term, but in most situations, they could well be looking to take their business elsewhere in the future. On the other side if the supplier feels they were the lo...Continue reading

Supplier rebate agreements are often based on the volume of purchases of particular products. This means that in order to accurately calculate the rebate that should be accrued or collected, and to minimize the chance of disputes with suppliers it is crucial that your rebate calculations are based on accurate data.

When choosing which data to use for your supplier rebate calculation, you will likely be considering the three following options. Unsurprisingly, each of these choices have advantages and disadvantages to consider depending on your internal systems, business processes and priorities.

Let’s dive in and take a look at the pros and cons.

5 min read

Safety in numbers is the well-known hypothesis that, by being part of a large group, an individual can reduce their risks and is, therefore, more likely to succeed. In the same way, buying groups typically form to provide smaller independent companies greater buying power by consolidating their purchases. While this structure can be hugely beneficial, we’ve found that it usually adds complexity to the process of managing retrospective rebates.

Due to the number of members changing and volatility of small business, there can be a great variance in the purchase volume from time to time. This means that the buying group as a whole can often struggle to commit to consistent large purchasing volumes which reduces buying group negotiating power and will lead to suppliers offering lower discounts.

Rebates often enter the conversation as a mutually beneficial method, offering tiered discounts based on actual purchases. Whilst rebates are the best solution for this problem in the eyes of the buying group, supplier and buying group members, they create new challenges for all involved. This can lead to large amounts of time and energy — that could be better utilised elsewhere — being unnecessarily wasted.

Let’s dive in to the 5 rebate challenges that are faced by both buying groups and their members:

5 min read

Businesses managing complex trading agreements face several hurdles that are difficult to overcome entirely when using manual processes and spreadsheets. Lack of transparency, inaccuracy and limited control of rebate accounting processes is common and the ramifications of these can have a damaging effect on profit, compliance, cash flow and business growth. For example, an accounting mistake that supermarket retailer Tesco made meant a £129m fine to avoid prosecution by the FCA for overstating...Continue reading