In our experience, many businesses that receive rebate revenue from suppliers, don't have the means to be able to check that it is correct.
For spring / early summer we have a series of three webinars planned to share more detail about our 3 step approach to profitable growth through:
mastering rebate accounting and maximising profit from rebate deals,
being prepared for and executing on smarter supplier negotiations,
collaborating with suppliers for mutually profitable growth.
Topics: Rebate Management, Procurement Excellence, Rebate Management & Compliance, Rebate Accounting, Industry Sector: Building Materials, Industry Sector: Wholesale Distribution, Rebate Management & Growth, Industry Sector: Retail, Industry Sector: Buying Groups, Rebate Management System
Failing to claim 100% of rebate due can have a large negative impact on the bottom line for businesses in industries where rebate agreements are commonplace. Finding out why that happens and how to stop missing vendor rebate claims is at the forefront of the minds of rebate accountants and financial leads the world over.
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. This blog and animation cover:
What is rebate management?
What is a rebate management system?
What are the benefits of having a rebate management system?
What types of company use rebate management systems?
Today it was announced that Tesco has agreed to a £129m fine to avoid prosecution by the FCA for overstating its profits in 2014. The root of the problem is believed to be premature recognition of rebate income from suppliers.
Topics: Rebate Accounting
The complexities involved in managing complex trade agreements and accounting for rebates and retrospective discount payments are often difficult to model in manual systems such as spreadsheets and basic accounting software. Organisations opting to calculate, forecast and accrue rebate income in this way leave themselves at risk of inaccuracies, missed opportunities and supplier disputes.
Here are 6 ways to improve rebate accounting processes in order to:
- remove the risks associated with manual processes
- deliver a streamlined process for handling complex trade agreements
- provide a foundation for growth in business profitability and revenue.
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 retailers, wholesalers and large buying groups, solving these issues to ensure receipt of the correct amount of rebate income and achievement of mutual trading goals is critical. So what are the common pitfalls of rebate management and how can they be avoided?
How was your last year end?
I’m not referring to the actual outcome, but the PROCESS of getting to your year end figures together.
If you’re in the fortunate position of being able to match each supplier invoice to an order at the right price, then perhaps your year-end is simply a question of dealing with a volume of transactions? But for those in the Building Supplies sector, those working in buying groups, and many wholesale distribution companies, revenue recognition is hampered by rebates, retrospective discounts and other promotions.
It's a complex task managing multiple vendor rebate deals across multiple vendors, multiple product lines, and in some cases multiple units of measure. 2 for 1, multi-pack discounts, retrospective discounts, limited lifetime promotions, not to mention awards points and prizes make rebate accounting a very complex job.
By way of illustration, we have worked on one example where there were 300 deals written into 1 vendor contract.