It’s intimidating enough managing rebates manually, add in the stress-inducing Excel formulas needed to calculate payments and you’re probably feeling the pain.
For more accurate and efficient rebate management, knowing where Excel lets you down is the first step. Taking back control of the rebate process will deliver profitability and volume gains to your business.
1. Spreadsheets won’t grow your business or grow with your business
It’s true - spreadsheets creep into every company early on in their growth.
There is a point where Excel can no longer easily or accurately manage the increasing amounts of data. You end up creating rebates that Excel can manage rather than a rebate that will drive customer loyalty.
For example, having a rebate connected to spend tiers, order size or product mix encouraging customers increase their volumes with you.
Solution: Have a tool that calculates and applies the rebate at the time of sale.
Having a tool that calculates rebates at the time of sale reduces the risk of ‘over-promised volume’. If a customer does not achieve the agreed volume, you can automatically adjust or remove the rebate. This will also provide greater margin transparency for more decision-making power around the sales deals you say yes and no to.
2. When complexity is too complicated
The problem with managing rebates in a spreadsheet is the time and cost needed to enter and update them. Rolling rebates over, without evaluating their effectiveness, to the following month or year can be dangerous. It establishes an expectation on the part of the customer that their rebate stands indefinitely and you become reluctant to roll it back for fear of losing customer volume.
Solution: Rebate management software will automate your rebate process.
This alone will mean you can accurately manage and calculate rebates with an easily accessible audit trail. This safeguards you against overpaying or underpaying your vendors, ensures rebates are earned, and increases the volume of rebates you can manage. Spreadsheets are also very time consuming and prone to errors, the time saved with employing rebate management software is in itself is another solution to the manual nature of spreadsheets.
3. Managing your rebates is harder than it should be
To take back control of the rebate process, you need to manage the calculation of rebates and handle complexity easily. Your Sales team should be able to select products and have the correct rebates automatically applied.
Solution: Analyse your rebates to ensure they are driving incremental volume.
With an automated rebates management process, rebates can be easily analysed for success or failure empowering you to take appropriate action. You can easily create and update rebates and don’t have to rely on the Sales team being aware that a rebate exists for specific products or customers.
4. Keeping your best price safe from prying eyes
The moment you offer a strategic customer a discount through a distributor, the distributor will know your best price and use that as their starting point for the next strategic customer.
Solution: Combine multiple rebates into the one order to disguise the best list price
A huge ask for a spreadsheet, not so with a solution that manages and automates the rebate. The more complex your rebate programs can be, the less chance your distribution channel has of recognizing your discounting behaviour. Spreadsheets limit the complexity of your rebate programs.