How to Maximize Your Holiday Budget with Rebate Management Services
The 2022 holiday season is upon us, and as businesses begin to close their doors, budgets are getting tighter. The holiday season is notoriously tough on many businesses; while pre-Christmas shopping sprees may send retail sales soaring, reduced hours and manpower can spell trouble for a business’ budget and revenue streams.
Some businesses have begun utilizing rebate management services to strategically prepare, survive and thrive through the holiday season. Rebates can help both customers and suppliers to maintain, protect and even increase their margins during the toughest quarters of the year – but only if rebate teams can stay on top of them.
Don’t Leave Money on the Table; Collect More Rebates
As a butterfly flapping its wings stirs up a tsunami on the other side of the world, overpaying or under-collecting rebates throughout the year can lead to significant reductions in your budget at year end. Companies that manage customer rebates on spreadsheets tend to overpay by 0.21%, equating to an average of $83,000 annually. Distributors on the receiving end of rebates are particularly vulnerable to this, as those using spreadsheets typically fail to collect 1% of the rebates they’re owed every year – an average of $218,829 annually.
In this case, your approach to rebate management – whether it be manual and reactive or proactive and automated – can have a real, measurable effect on the success of your rebate programs. Distributors using dedicated rebate management services typically earn 1.82% more rebates. That’s an extra $182,000 on every $10m of rebate income.
Make the Most of Your Margins
But the benefits don’t stop there. When manufactures make fuller use of rebates, they typically achieve a 1.64% margin uplift — or an extra $164,000 for every $1M in profit. Rebates are tremendously powerful tools for protecting — and growing — margins. When you negotiate the terms of your trading agreements, make sure that your rebates work at every tier, threshold or mix, or else you risk losing money on your margins.
One way to ensure that you’re using rebates to the fullest is to automate the arduous, time-consuming processes that your team is buried under. An intelligent rebate management service can provide you with detailed analyses, at-a-glance overviews, on-demand reports and reliable calculations at a moment’s notice.
Avoid Administrative Waste
One of the most significant drains on the time, energy and resources of companies involved in rebates is attempting to manage them manually. The responsibilities of tracking, calculations, analysis and reporting on rebate performance or earnings
Manufacturers using rebate management software to automate month-end calculations typically spend 35% less time on month-end processes. This means that instead of paying your employees to perform simple repetitive tasks by hand, you can pay them to do work that actually grows your business. Even with the high upfront costs of rebate management software, you’ll end up saving money on paying several employees to spend hours doing manually what one software can do automatically in an instant.
With rebate management services protecting your margins and helping you to avoid waste, you have more freedom to spend your budget on the things you need to grow or improve your business instead of worrying about having enough left over to make it through the holidays. By minimizing waste, redundancy and human error, rebate management services can help you stretch even the tightest of budgets.
Build Customer Loyalty
There are few times you need customer loyalty more than when budgets get tight. Losing customers at this critical point in time can mean serious problems for your business. To prevent this, make the effort to build up customer loyalty over time and well in advance. Come the winter season, your customers should be looking for ways to strengthen their relationship to your business, not looking for the exit.
One way to encourage and reward customer loyalty is through rebate programs. Part of the beauty of rebates is their malleability. You can create bespoke rebate programs to suit the needs, strengths, concerns or connections of any business you work with. Do you need larger orders to cover increased operating costs through the holiday season? Consider rewarding bulk buyers with a lump sum or logistics rebate.
Automation also plays a key role in building customer loyalty with rebates. With so much data to keep up with, human error is a common risk in rebate management. However, errors or disputes in rebate calculations can put a heavy strain on relationships between customers and suppliers – but automating your rebates can help to avoid this risk. Automating your rebate programs also promotes transparency and collaboration between trading partners.
Take Your Holiday Budget Farther with Rebate Management Services
The holidays can be a stressful time for many businesses, but they shouldn’t be. Wrapping things up at year end should be an enjoyable experience for your rebate teams, not a desperate search for wiggle room in the budget. Choosing an effective rebate management software to build your process around can play a significant role in preserving your business’ holiday budget, so you can spend money when you need to (and never when you don’t).
Ready to transform your rebate management process? Learn how to choose the solution for you in our new blog, What is the Best Rebate Management Software?