Rebate accounting professionals play a vital role in driving business growth and strategy, but most businesses don’t give them the chance to do this because the rebate accounting team is bogged down with inefficient, manual processes taking up all of their time. A McKinsey report found that employees spend 19% of the average working week (close to 8 hours per week), searching and gathering information. Before accepting that your current rebate accounting processes are simply fine consider the true impact of wasting your team’s valuable time.
Manually entered rebate data is prone to errors and, as your business grows and the number of deals you manage increases, you’ll find that spreadsheets slow down and calculations get more complex. Rebate accountants have to rush to complete tasks on schedule which can lead to human errors and oversights with financial data. Finding and fixing the problem takes even more time. This is less likely to happen with all your data in one system.
Disappearing trading agreements
When there’s a backlog of trading agreements waiting to be signed off manually, it’s not uncommon for emails or paper documents to be temporarily misplaced or completely lost on someone’s desk or filed away in a drawer. The rebate accounting team needs to know what was agreed before they make any payments.
Missed or delayed payments
Companies can have whole teams dedicated to negotiating and managing rebate, however a lack of collaboration between the teams or a shortage of time can lead to missed or delayed payments especially if the invoice is lost. It is likely that rebate income is going to slip through the cracks and be missed unless a complete rebate solution like Enable is implemented to handle your rebate accounting processes.
Slow deal approvals
If you’re going back and forth with your trading partner trying to get a deal approved over email it’s not only inefficient but also time consuming. There is also a chance of the deal not getting approved on time if say the person goes away and doesn’t leave a handover with a team member or worse yet there can often be older versions of the same type of agreement floating around. To solve this issue its best to use an online platform where you can all your trading agreements and have a clear audit trail and status.
If you are using spreadsheets to manage your rebates it can take a lot of time to manually track all of the data necessary to ensure financial compliance, not to mention the errors that can occur which aren’t just frustrating but can also be costly. Rebate accounting inefficiencies makes it harder to perform compliance audits, meaning fines and penalties can happen which can damage the reputation of the company but are easily avoidable. Especially when you have a rebate management system in place.
Procurement and those negotiating new deals need financial insights at their disposal in order to make sound decisions, but if the information is not readily available, they may not be able to wait. Missing or inaccurate financial data puts your company and its decision-makers at a disadvantage and can lead to costly setbacks if deals don’t perform as they should.
How can you improve your rebate accounting processes?
Using a rebate management system to automate your finance processes should be a no brainer. Why go through the laborious process of calculating and allocating rebates manually when you could have intuitive software take care of it all for you in a fraction of the time?
With the right rebate accounting software, you can help your finance team to react and adapt plus avoid costly errors and keep all important documentation in plain sight. Companies who have automated aspects of their rebate accounting have seen an increase in ROI, operational efficiency and met their business goals.