finance toolkit

The ultimate finance toolkit for better rebate management

Posted by Elizabeth Allcock on January 14, 2021 08:15:00

Finance teams play a pivotal role in understanding the impact of deals and rebates and in guiding their organization for what comes next. However, over the past few years they have been neglected with outdated software and manual processes that consumer their time and energy. Here are key business outcomes that your finance function can achieve from implementing rebate management software.

Key business outcome: Increase profitability

Collecting rebate agreements on time, consistently and accurately is a tactic to increase profitability. However, too often traditional methods of rebate management can lead to missed rebates and poor accrual accounting. With a dedicated end-to-end rebate management system such as Enable, the finance function will have all the data required to manage their rebate accounting accurately. Providing your business with truthful data, helping to bridge the gap between disconnected or broken processes and giving your finance function the freedom to focus on managing your rebates properly.

4 resources to help you achieve this outcome:

Key business outcome: Improve collaboration

The finance function needs to have real-time visibility of their B2B deals and a strong understanding of what’s involved with each deal. This will ensure informed decisions are made and reduce the risk of disputes that could damage or even jeopardize collaboration between trading partners.

We believe technology is fundamental to the success of any future collaboration for the finance function. Enable’s collaboration portal enables purchasing and sales to work together to maximize rebate revenues, and finance to monitor, accrue and claim for all rebate due – with a full audit trail.

 

3 resources to help you improve collaboration:

Key business outcome: Offer more types of deals

At Enable we have come across over 300 different types of deals and we’ve mapped all of those options into our rebate management software. The most popular types of agreements are off invoice discounts, retrospective discounts, marketing funds and promotions. The purpose of these deals is to formalize a joint business plan to work together for a given period and deals can also be to incentivize behaviour.

Deals can be simple such as 1% off everything you buy which is really easy to calculate and has generic benefits but doesn’t necessary drive behaviour. On the other end rebates can be complex especially if they are tiered and targeted based on specific product ranges and rebate is paid on specific transactions.

A lot of finance teams may want to implement new deal types but if they haven’t got the processes or software in place so that both parties can keep track of the more complex deals it won’t benefit either of them.

 

6 resources to help you offer more types of deals:

Key business outcome: Streamline rebate processes

For many small to medium businesses, rebates can mean the difference between profit and loss and for large enterprises even a small improvement in procedure can lead to the discovery of millions of dollars. Therefore, it’s essential for any company which deals in rebates to regularly evaluate their existing rebate management process and identify areas for improvement. This all starts with a dedicated rebate management system which can:

  • Boost commercial performance - Actionable insight reveals sales and margin opportunities within your deals and promotes frictionless trading through precise execution.
  • Increase financial transparency - Take control of your deal management to strengthen and accelerate your financial reporting with auditable results and up-to-date information.
  • Drive operational efficiency - Maximize productivity through collaboration and business process automation.

 

6 resources to help you streamline rebate processes:

Key business outcome: Reduce rebate errors

Finance teams who are relying on outdated, manual processes such as spreadsheets and using pen and paper to sign of their trading agreements end up increasing the probability of errors and inconsistencies in the rebate management process.

Human errors when entering data are one of the most common causes of unnecessary monetary loss. These errors tend to happen when managing many complex deals as they can be very labour intensive, and it can be difficult to link them up with the data especially if using manual, spreadsheets.

Some errors may have minimal effect to a company’s financials and can be corrected. While other errors are more serious and could have a significant impact by misrepresenting a company’s true financial health. Hence why a rebate management system is critical to minimize any errors for finance going forward.

 

5 resources to help you reduce rebate errors:

Key business outcome: Automate forecasting

Accurate forecasting is vital to success to ensure that finance are aware of what the future is likely to hold so that they can appropriately allocate resources to assist in key areas. Accurate forecasting also helps finance reduce unnecessary spending, avoid missing potential opportunities and improve cash flow management. Enable features automatic forecasting which allows users to view the forecasted earnings for their deals. Our rebate management software forecasts the total spend of the deal and then calculates the forecast earnings based on that forecasted spend.

 

4 resources to help you automate forecasting:

Key business outcome: Accurate accruals

A rebate accrual is the expectation of income at a later date. All rebate income must be accrued for – even though the money isn’t actually in the bank yet – in order to accurately calculate profit and loss. However, the sheer volume of deals to handle and the level of complexity involved with each of them, can easily result in incorrect calculations of amounts due. This is especially true when finance teams are relying on spreadsheets which are open to human error, lack version control and collaboration.

The finance function need to have complete control and confidence in their rebate accrual accounting process to ensure both accuracy and compliance. There can be serious consequences if rebates are mishandled, and profits are over or under-stated. So, to regain control over rebate accruals, companies must take a hard look at their current rebate accounting processes and if necessary, implement a rebate management solution to address the gaps that some accounting systems leave behind.

2 resources to help you achieve accurate accruals:

If you want to experience our rebate management software for your finance team, try Enable for free.

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Topics: Rebate Management, Rebate Accounting, Rebate Management System, Industry sector: Finance