We help buying groups, wholesale distributors, and retailers protect margin, accelerate cash flow and reduce risk in their trading agreements. Using DealTrack, our market-leading rebate management software, clients typically manage between £100m and £30bn of rebatable purchases annually.
The complexities involved in retrospective payments on trade agreements and the sheer volume of these contracts, are often difficult to model in manual systems such as spreadsheets and basic accounting software. Organizations opting to calculate, forecast and accrue rebate income in this way leave themselves at risk of inaccuracies, missed opportunities and supplier disputes.
Rebate management software meets these problems head on, by removing the risks associated with manual processes and delivering a streamlined process that handles complex trade agreements in the following ways.
What problems are solved by rebate management?
1. Complex trade agreements
Sophisticated rebate management software excels where basic accounting packages and spreadsheets fall short: the software handles all deal dimensions from the type of deal being made, to the member or branch rules that apply to each of these, the turnover bands they fit into and all the intricacies in between. The complexities remain the same, but the input and management of these is entirely simplified.
2. Automated calculations
Calculations can be based on purchase data, goods received, sales transactions and/or the data reported by suppliers based on the agreed parameters of each deal ensuring accurate, visible and timely accruals. Automating the calculation of rebates based on transactions and agreed contracts provides accurate data, which purchasing teams can immediately access in order to consistently negotiate from a position of strength.
3. Deal modelling
With a sophisticated rebate management system, greater purchasing insight is at your disposal through deal modelling features. Purchasing departments should be able to replicate former deals and alter their data dimensions to forecast parameters for new contract negotiations, as well as those coming up for renewal.
4. Never miss an opportunity
Another advantage of a well thought out rebate management software solution is the true cost and margin alerts that automatically flag up when deals and opportunities could be missed, or need to be chased. Buy price, sell price and true net cost price can be clearly stated and then used to prompt these margin alerts. This helps to avoid margin-damaging purchase decisions that can result from the continual variation in complex deals.
Proactive notifications are also raised when your contracts need to be renewed, when contract sign-off is required, when incentive targets are approaching/likely to be missed, or a change to a contract is pending review. Missing opportunities becomes near impossible!
5. Online contract management
With supplier contracts being negotiated and managed by multiple people across several teams within organizations and within suppliers’ businesses, a collaborative portal is a highly efficient feature of rebate management software. This supplier contract management ensures both you and your supplier share an identical version of the trade agreement, enabling a shared understanding whilst allowing internal management sign off, as well as external sign off by supplier.
6. Structured agreement data
With rebate management software, agreements can be recorded electronically (as structured data) rather than as a written document that’s often filed away and reviewed at the end of the contract. Standardised, professional and compliant contract documents can be generated automatically from data, whilst automated processes such as earnings calculations can be based on this data too, further avoiding any discrepancies.
More about rebate management
- Calculating rebates at a granular level of detail
- Why your ERP system doesn’t cope with rebate accounting
- Rebate management integration techniques — which method will you choose?
To some, income from special pricing agreements, rebate agreements or market development funds is treated as a ‘bonus’. But to other companies, these rebates form a significant proportion of their revenue and therefore warrant accurate management.
How can you ensure you keep track of your rebate contracts effectively and reliably?
Our guide will give you all the information you need to implement a structured approach to effectively managing rebates and complex trading agreements.