Rebates...how do they work and what's the point?

[NFS4]

OK, I've been thinking about rebates and I know a few things about them, but I wanted to get the full scoop. From what I gather just by observation:

1) Not everyone turns in rebates, so there not a 100% chance that they would have to put out
2) Submissions can get lost in the mail, refer back to #1
3) They can find some picky reason to reject your submission, refer back to #1

Other than that, why do they normally take so f*&king long to give you your money back? Do they just like to keep you waiting or is it that the company just doesn't have the money at the time?

 

[fatbaby]

1. More $$$ for the company
2. More $$$ for the company
3. More $$$ for the company

Other than that, why do they normally take so f*&king long to give you your money back? Do they just like to keep you waiting or is it that the company just doesn't have the money at the time?

Interest$$$

 

[Evadman]

THey get $$ in hand.

 

[Viper GTS]

An amazingly high percentage of rebates never get sent, IIRC it's nearly half.

Viper GTS

 

[HappyPuppy]

Wow, after 28,000 posts you finally figured it out.

 

[NFS4]

Originally posted by: HappyPuppy
Wow, after 28,000 posts you finally figured it out.

It's not that I "just" figured it out. It's just that I haven't really cared enough to even think about it.

 

[CarpeDeo]

Originally posted by: Viper GTS
An amazingly high percentage of rebates never get sent, IIRC it's nearly half.

Viper GTS

What's IIRC?

 

[NFS4]

Originally posted by: CarpeDeo

Originally posted by: Viper GTS
An amazingly high percentage of rebates never get sent, IIRC it's nearly half.

Viper GTS

What's IIRC?

If I Recall Correctly

 

[PsychoAndy]

I havent taken Managerial accounting yet, but someone correct me if i'm wrong here.

$1000 laptop with a $200 MIR.

Retailer takes $1000 up front. Records as revenue. Writes rebate to pay customer and records as an expense.

Not only is it a booster for the top line, but a tax deductible expense as well.

Maybe.

-PAB

 

[zer0burn]

the retailer wouldnt right it off usually its a manufacture rebate, and itd be a selling expense probabbl

 

[vegetation]

Offering small rebates is the way to go for fraudulent management of a company. Clear out your inventory fast, offer a rebate, but only fulfill them to the 1% of the people who actually submit a rebate and complain about not receiving it. I wont mention names, but a company who sold cans of compressed air through a major retailer does exactly this.

 

[rudder]

So companies like bestbuy can send out flyers advertising $20 cdr's and free blank cd's (after MIR) to sucker you to come into the store. And they know full well that 97% of the people will never see the rebate.

 

[BlamoHammer]

Originally posted by: rudder
So companies like bestbuy can send out flyers advertising $20 cdr's and free blank cd's (after MIR) to sucker you to come into the store. And they know full well that 97% of the people will never see the rebate.

My experience is that people who never recieve their rebates are also the people who dont fill them out properly. Every rebate I have filled out and sent off I have received.

 

[NFS4]

Originally posted by: PCH0

Originally posted by: rudder
So companies like bestbuy can send out flyers advertising $20 cdr's and free blank cd's (after MIR) to sucker you to come into the store. And they know full well that 97% of the people will never see the rebate.

My experience is that people who never recieve their rebates are also the people who dont fill them out properly. Every rebate I have filled out and sent off I have received.

Same here, I've gotten back EVERY rebate. Then again, I take the time to read the forms and do EXACTLY what it says and send EVERYTHING in.

 

[fatbaby]

well you see bestbuys does not lose $$$ on rebates since they do not process them. Rebates are a incentive by the manufactuer for customers to buy their products. They also give an incentive to go to the store that is having the stuff after rebate. Thats why the retailers like rebates. Its a win win situation for them.

Thats why retailers usually won't pm the AR price or allow pms with items AR (they do sometimes)

 

[dolph]

the last figure i remember seeing is only 15% of people submit rebates. how many of them actually get it i don't know. so it's a huge money maker for the company. what i don't get are instant rebates, though... what's the point?

 

[XCLAN]

Originally posted by: PsychoAndy
I havent taken Managerial accounting yet, but someone correct me if i'm wrong here.

$1000 laptop with a $200 MIR.

Retailer takes $1000 up front. Records as revenue. Writes rebate to pay customer and records as an expense.

Not only is it a booster for the top line, but a tax deductible expense as well.

Maybe.

-PAB

If thats the case andy....i am gunna start a local business and become rich with schemes like this...thanx I will mail you a small percentage of my fortunes.

 

[Frosty3799]

Originally posted by: dolph
what i don't get are instant rebates, though... what's the point?

These are usually offered on the items that are already receiving MIR's. Here is an example of how I see them working.

Regular price $49.99
MIR $20
IR $10
Final cost that they advertise: $19.99

Now, consider the fact that only 15% (from your figure) send in, and possibly receive their MIR back, they are really selling 85+% of this product for $39.99, but becuase they can advertise that final price of $19.99, they get sooo many more buyers for the item that they still make a huge excess profit over their regular price of $49.99.

So really they are to get you in the store and paying them $$ on more things you normally wouldn't have bought, but since the products are so cheap, you buy anyway.