Using Rebates
A rebate is the amount of the purchase price refunded by the seller to the payer. A rebates is be paid out only if the value of goods or quantity purchased reaches the specified limit or other specified goals are met, usually for a given time period.
Rebates are traditionally utilized to reach the following business goals:
Customer retention
Attract new customers
Getting additional information about customers
Maintaining high net prices
Reducing visibility in overall price reductions
Improve sales volume
Dive Deeper: Understanding Rebates in Business Operations
A rebate is a refund of a portion of the purchase price given by the seller to the buyer. It is paid out only when the value of goods or quantity purchased reaches a specified limit or other specified goals are met, typically within a certain time period. Rebates are commonly used to achieve business objectives such as retaining existing customers, attracting new customers, gaining additional information about customers, maintaining higher net prices, reducing visibility in overall price reductions, and increasing sales volume.
Use Pricefx to Manage Rebates
Pricefx offers functionality that enables you to:
Create, manage and execute rebate agreements
Set rebates at any customer/product levels
Create, track and manage any rebate types in a transparent and easy way
Use built-in analytics to track rebates performance and prepare for claims payouts
Integrate with leading CRM and ERP systems to streamline rebate processes
Automate rebate approvals and push accruals to the ERP system
Global rebates visualization using Dashboards
Dive Deeper: Streamlining Rebate Management with Pricefx Functionality
Pricefx offers functionality that enables you to create, manage, and execute rebate agreements, set rebates at any customer/product levels, and track and manage rebate types transparently. Additionally, it provides built-in analytics to monitor rebate performance and prepare for claims payouts. Integration with leading CRM and ERP systems streamlines rebate processes, automates approvals, and pushes accruals to the ERP system. The global rebates visualization using Dashboards provides comprehensive insight and analysis. These features benefit businesses by streamlining rebate management, improving transparency, automating processes, enhancing performance tracking, and providing valuable insights for informed decision-making.
Getting Started with Rebates
Pricefx offers a Rebate Management Accelerator Package that provides a solution for fast implementation, easier management of rebates agreements, and complete support of typical rebate calculations.
The Rebate Package provides:
20+ predefined rebate types with calculation logics
Approval workflows
Baseline values calculations
Inbuilt analytics - 3 predefined Dashboards
Rebate forecasting
Templates for customized agreement output documents
Typical Business Scenarios
The Rebates functionality can be used for the following scenarios:
Dive Deeper: Centrally define rebate types that will be used locally/globally
Businesses can use rebates for centrally defining rebate types that will be used locally and globally by establishing a standardized set of rebate categories and terms. This allows for consistent application of rebate types across different regions and markets, ensuring uniformity and clarity in rebate offerings. By centrally defining rebate types, businesses can streamline the management of rebate programs, improve transparency, and facilitate easier tracking and analysis of rebate performance on a global scale. Additionally, it enables businesses to maintain control over rebate structures and ensures that local and global rebate strategies align with overall business objectives.
Dive Deeper: Make a forecast on paid out rebates based on previous performance
Businesses can benefit from using rebates in the scenario of making a forecast on paid out rebates based on previous performance. By analyzing historical rebate performance, businesses can gain valuable insights into rebate payout trends, seasonality, and the impact of different rebate programs on sales and customer behavior. This data can be used to make more accurate forecasts on future rebate payouts, allowing businesses to better anticipate and plan for financial obligations related to rebates. Additionally, forecasting paid out rebates based on previous performance enables businesses to optimize budget allocation, improve cash flow management, and make informed decisions regarding rebate program adjustments and resource allocation. This proactive approach to rebate forecasting can lead to improved financial planning and more effective use of rebate incentives to drive desired business outcomes.
Dive Deeper: Approve and manage customer-specific bonus and rebate agreements
Businesses can benefit from using rebates in the scenario of approving and managing customer-specific bonus and rebate agreements in several ways. Firstly, it allows businesses to tailor incentive programs to specific customer segments, encouraging customer loyalty and repeat purchases. This personalized approach can lead to increased customer satisfaction and retention. Additionally, managing customer-specific bonus and rebate agreements enables businesses to strategically allocate resources and incentives to high-value customers, driving sales growth and revenue. It also provides businesses with the flexibility to adapt incentive programs based on individual customer needs and behavior, enhancing the overall customer experience. Furthermore, effective management of these agreements can lead to improved transparency, accuracy, and compliance, ensuring that both the business and its customers benefit from clear and fair incentive structures.
Dive Deeper: Calculate bonuses and rebates based on the actual performance
In this scenario, businesses can benefit from using rebates to calculate bonuses and rebates based on actual performance. By doing so, businesses can align incentives with specific performance metrics, such as sales targets or volume thresholds, motivating and rewarding employees, partners, or customers for achieving desired outcomes. This approach encourages improved performance, productivity, and sales growth, as individuals and teams are incentivized to meet and exceed targets. Additionally, it allows for a more equitable distribution of rewards based on actual results, fostering a culture of fairness and transparency within the organization. Moreover, by linking bonuses and rebates directly to performance, businesses can effectively manage costs and ensure that incentives are tied to measurable value creation.
Dive Deeper: Create rebate records that will be sent to other systems (for payouts)
In this scenario, businesses can benefit from using rebates to create rebate records that will be sent to other systems for payouts. By doing so, they can automate the process of recording and transferring rebate information to external systems, such as finance or payment processing platforms. This automation reduces manual data entry errors, speeds up the rebate payout process, and ensures accuracy and consistency in the transfer of rebate records. Additionally, it enables seamless integration with other systems, leading to efficient and timely rebate payouts. This streamlined approach not only saves time and resources but also improves the overall transparency and auditability of rebate transactions, enhancing trust and compliance with internal and external financial processes.
Rebates Key Functionality
The Rebates capability offers the following functionalities:
Rebate Agreement Types
To create and maintain the rebates, the first step is to define the agreement type. You can have as many rebate agreement types as you need for your business purposes.
Condition Types
For each rebate type in your business process, you need to have a condition type in place that represents the different ways of rebate agreement calculations. Condition types will vary due to goals, rebate criteria, and rebate calculation behavior.
Rebate Templates
Based on templates you can generate different rebate agreement outputs. These templates can be shared with others via Excel file and/or PDF file.
Rebate Templates is a mechanism allowing you to mass-create many Rebate Agreements at the same time and is available in the Profit package.
As an example, it can be used to:
Mass-upload (i.e., mass-create) many Rebate Agreements from customer's system into Pricefx.
Create a pre-populated Rebate Agreement based on previously created Rebate Agreements.
You can define templates for customized Rebate Agreements where you can combine placeholders (computed parameters, such as customer ID or Rebate Agreement name) and user inputs (parameters provided by user). Templates can access all kinds of data using the standard Pricefx interface, i.e., Datamart, Company Parameters, etc.
Rebate templates are dynamically filled in based on the data from existing or created Rebate Agreements. They include Rebate agreement conditions, terms and conditions, other static parts of the document such as signatures, and overall graphical layout.
Rebate Agreements
A rebate agreement will include the validity dates, condition types, specific input pricing parameters, specific payout dates, and additional analytics and performance charts.
Calculations
To perform the rebate calculations, Pricefx offers a configuration logic (formula) that will set up price calculations and call different data from different sources, including master data and pricing parameters. Each condition type has a calculation logic associated.
Rebate Records
Rebate records are created for each item line condition of the Rebate Agreement upon its approval. This list will represent the approved and calculated records ready for the payout process.
Payout Records
When the rebate calculations are completed and submitted, the payouts are generated and you can see those payout records in Pricefx. These are the records transferred to your ERP (accounting) system.
