16th November’22: A rebate is a contract in which the manufacturer agrees to return a portion of the purchase price to the channel partner if their purchase reaches a certain quantity within the specified period of time. Many rebates have additional requirements or specific tiers that match the manufacturer’s goals. Rebates differ from discounts and coupons in several ways. This means that rebates are made after the sale and purchases are made at full price.
It is important to understand the concept as it will resolve underlying issues for manufacturers who want to avoid overpaying rebates and channel partners who want to avoid underbilling rebates.
Why is it important to Incentivize Channel Partners?
Your channel partners aren’t merely making sales on your behalf. It’s likely that they are also selling for other vendors who have comparable products to yours. In order to compete, you must set yourself apart from your rivals and motivate your channel partners to promote you. Giving rebates to your channel partners is a fantastic method to accomplish this.
The great thing about utilizing Rebates as an incentivization method is that it allows manufacturers to invest in existing businesses and has positive feedback from partners.
By giving partners a portion of the sale back, a rebate motivates them to make more sales. For instance, a channel partner would receive 10% of the sale if he sold 10,000 pieces of your product. This kind of incentive is straightforward and effective in getting your channel partners to market your products as they grow along with your sales.
Top Four Benefits of Automating Rebate Process
- Since multiple teams are engaged in managing the rebate process, automation can help in saving team members’ bandwidth which can be invested in other worthwhile projects related to transaction analysis and strategy.
- High accuracy and lower chances of errors in calculating rebates
- Less time to calculate rebate will reduce processing time and eventually lower cost. Time is money you see!
- Reliable & accurate data will help in maximizing profits from rebate deals