industrialsupplymagazine.com Open in urlscan Pro
54.157.19.43  Public Scan

Form analysis
2 forms found in the DOM

GET /pages/Search.php

<form action="/pages/Search.php" method="GET">
  <input type="search" name="search" id="searchInput"><button type="submit" id="searchSubmit">SEARCH</button>
</form>

POST /page_comments.php

<form action="/page_comments.php" method="post" id="pageCommentForm">
  <div id="pageCommentHeader">Post comment / Discuss story <span class="pageCommentRequired" style="padding-left:20px;">*</span> Required Fields</div>
  <div class="pageCommentField">Your name:</div>
  <div class="pageCommentInput"><input name="name" id="commentName" value=""></div>
  <div class="clear"></div>
  <div class="pageCommentField">E-mail <span class="pageCommentRequired">*</span>:</div>
  <div class="pageCommentInput"><input class="pageCommentInput" name="email" id="commentEmail" value=""></div>
  <div class="clear"></div>
  <div class="pageCommentField">Subject:</div>
  <div class="pageCommentInput"><input class="pageCommentInput" name="subject" id="commentSubject" value=""></div>
  <div class="clear"></div>
  <div class="pageCommentField">Comment <span class="pageCommentRequired">*</span>:</div>
  <div class="pageCommentInput"><textarea name="comment" id="pageCommentComment"></textarea></div>
  <div class="clear"></div>
  <div id="recaptcha_area">
    <div id="page_comment_captcha">
      <div style="width: 304px; height: 78px;">
        <div><iframe title="reCAPTCHA"
            src="https://www.google.com/recaptcha/api2/anchor?ar=1&amp;k=6Ld8B04UAAAAAD5CQZPkG0GhEBT1DlX8Nbvb2rS4&amp;co=aHR0cHM6Ly9pbmR1c3RyaWFsc3VwcGx5bWFnYXppbmUuY29tOjQ0Mw..&amp;hl=de&amp;v=Nh10qRQB5k2ucc5SCBLAQ4nA&amp;size=normal&amp;cb=5b6poa7k0fl"
            width="304" height="78" role="presentation" name="a-83wdpodqm4ba" frameborder="0" scrolling="no" sandbox="allow-forms allow-popups allow-same-origin allow-scripts allow-top-navigation allow-modals allow-popups-to-escape-sandbox"></iframe>
        </div><textarea id="g-recaptcha-response" name="g-recaptcha-response" class="g-recaptcha-response"
          style="width: 250px; height: 40px; border: 1px solid rgb(193, 193, 193); margin: 10px 25px; padding: 0px; resize: none; display: none;"></textarea>
      </div><iframe style="display: none;"></iframe>
    </div>
  </div>
  <script type="text/javascript">
    window.addEventListener('load', function() {
      widgetIdpage_comment_captcha = grecaptcha.render('page_comment_captcha', {
        'sitekey': '6Ld8B04UAAAAAD5CQZPkG0GhEBT1DlX8Nbvb2rS4'
      });
    });
  </script>
  <div class="clear"></div>
  <br>
  <input type="submit" value="Post Comment">
</form>

Text Content

News
News
January 2023
December 2022
November 2022
October 2022
September 2022
August 2022
July 2022
June 2022
May 2022
April 2022
March 2022
February 2022
Articles archive
Articles archive
Print edition
Inventory Management
Motivation
Management
Marketing
Sales
Resources
Resources
Buying and marketing groups
Colleges of Industrial Distribution
Distributor trade associations
Manufacturing trade associations
IS Video Library
IS eResource Guide
New Products
IS Product News Roundup
New Products
New Products by Category
Abrasives/Brushes
Chemicals/Lubricants
Cutting Tools
Hand Tools
Hose and Accessories
Maintenance and Cleaning Supplies
Material Handling Equipment/Supplies
Power Tools
Power Transmission / Motion Control
Safety Supplies
Welding
Miscellaneous
Media guide
Subscribe
New print subscription
Renew print subscription
Change of information
Login
News
Articles archive
Resources
New Products
Media guide
Subscribe
Login

SEARCH
A DIRECT BUSINESS MEDIA,
LLC PUBLICATION



Posted December 26, 2022


WHY IT’S VITAL TO MEASURE REBATE DEAL PERFORMANCE

By Mo Barsema, Industry Principal at Enable

At a time when inflation and economic volatility continue to roil supply chains
around the world, it has never been more important for manufacturers and
distributors to implement mutually beneficial trading agreements that will help
them mitigate risks, reduce costs, and drive sales. These deals should include
rebate programs that help supply chain partners improve their margins by
securing greater market share and increasing brand recognition.

--------------------------------------------------------------------------------



But a rebate deal has limited utility if you’re incapable of measuring its
performance. Partners have to know whether their loyalty programs actually make
an impact on market share, brand penetration, and their bottom lines to help
them make informed decisions about whether and how to adjust these programs.
Effective measurements of deal performance require accurate forecasting on
monthly spend (which can be based on spending in the previous year or current
year trends), as well as the ability to track the success of marketing and sales
efforts.

Many people are responsible for ensuring the success of a rebate deal: sales and
marketing teams, finance specialists, purchasing and pricing teams, and company
leaders. All of these stakeholders have to be aligned on the core goals and
mechanisms of the deal, which means they need access to a single source of
information that can drive joint decision-making. The data won’t lie – it will
show you which aspects of the deal are working, which ones aren’t, and how you
can enable success.

Structuring a Rebate Deal

When supply chain partners negotiate a rebate program, they should remember that
the primary goal is to incentivize the maintenance of a productive, long-term
relationship. While the deal should challenge both partners to increase
efficiency and improve margins, it should also contain safeguards that provide
support when targets aren’t met. Supply chain issues have certainly weighed
heavily on partner relationships and these issues have impacted deal
performance. The central purpose of rebate programs is to put those
relationships on more solid ground.

There are several questions suppliers and distributors should ask as they
structure a rebate deal. First, are the performance tiers reachable? It doesn’t
make sense to sign-off on a rebate deal if targets aren’t attainable. Use last
year’s performance as a benchmark for figuring out what’s feasible and consider
the impact certain business had on that performance, as business climates
change. Second, after identifying the earnings potential of the deal, partners
must establish if their rebate tiers are based on all products and/or certain
product groups, as well as whether they’ll use remittances or purchases as the
basis for calculating earnings. And third, partners must determine how cash
discounts will be applied and which payment terms will work best.

Once this foundation is in place, suppliers and distributors can focus on
performance goals and how to measure progress toward them.

Measuring Deal Performance
One of the clearest trends in the supply chain sector is the move toward
end-to-end visibility, as it allows suppliers and distributors to identify pain
points, replicate what’s working well, and improve planning. According to a
global survey of supply chain leaders conducted by McKinsey, the top three
targets of digital investments are: visibility, specific planning tools, and
end-to-end planning. One likely reason for these investments is the fact that
there’s a direct connection between measuring performance and strategic
planning.

A critical element of performance tracking is the ability to forecast spend,
which allows you to align purchasing decisions with business opportunities and
track actual spending alongside what’s budgeted. Spend should be automatically
adjusted on a monthly basis to perfect real time forecasting. Where there are
misalignments between forecasts and real volume, calculated rebate earnings will
adjust accordingly. Without robust data on past and future spend, it will be
extremely difficult to accurately accrue rebate earnings and determine whether
your rebate strategy is working.
It’s vital to understand the mechanics of your rebate deals right at the outset.
When a deal is first negotiated, the details will affect everything from how
payments are made to which performance metrics are used in tracking progress
toward which goals. Your sales, marketing, procurement, and pricing teams will
need this knowledge to help them maximize your rebate strategy across as many
links of the supply chain as possible.

Bringing All Stakeholders Together Around Your Rebate Strategy

The implementation of your rebate deal requires a concerted effort across the
supply chain. Beyond the company leaders who negotiate the deal, for instance,
the marketing and sales teams are responsible for driving performance by
promoting and selling the products that are included in the deal. Companies have
to decide which marketing resources to use (such as MDF/co-op programs), as well
as which markets and customers to target, how to capture market share from
competitors, and how to measure these marketing efforts.

On the sales side, you have to train sales professionals to drive deal
performance and determine how their efforts will be measured. You also have to
decide if a separate incentive program is necessary to optimize rebate deals –
such as rewards for selling high-margin, low-volume products. Once your rebate
deal is negotiated and your sales strategy is in place, prepare to measure the
key metrics: sales growth, gross margin, rebate growth, tier achievement (where
applicable), and so on. When all internal stakeholders understand the goals of
your rebate strategy – and have the digital resources they need to track
performance – it will be easier to work toward those goals.

Rebates are essential for building more resilient and agile supply chains – the
two central goals of professionals in any sector. But supply chain partners
can’t simply implement a rebate strategy and hope for the best – they have to be
capable of figuring out whether that strategy is working and making changes
along the way. This is why suppliers and distributors have to take performance
measurement seriously if they want to fully leverage their rebate deals.



COMMENTS: 0

--------------------------------------------------------------------------------

Post comment / Discuss story * Required Fields
Your name:


E-mail *:


Subject:


Comment *:






Share This!
 



INDUSTRIAL SUPPLY MAGAZINE



The Jan./Feb. issue of Industrial Supply magazine is off the press. It features
an in-depth cover story about how Fastenal works the kinks out of supply chain
disruption with a strategic emphasis on people and partnerships. Plus articles
by contributing writers that include David Bauders, Jason Bader and other
leading experts in the distribution community.

Read The Articles Read The Digital Edition
sponsored by Tompkins Industries


SPONSORED ADS













Copyright © 2010-2023 Direct Business Media, LLC. All rights reserved.

401 South Fourth Street W, Fort Atkinson, WI 53538

For comments or questions about this Web site contact:
rvurva@directbusinessmedia.com



Privacy Policy

News
January 2023
December 2022
November 2022
October 2022
September 2022
August 2022
July 2022
June 2022
May 2022
April 2022
March 2022
February 2022
Articles archive
Print edition
Inventory Management
Motivation
Management
Marketing
Sales
Resources
Buying and marketing groups
Colleges of Industrial Distribution
Distributor trade associations
Manufacturing trade associations
IS Video Library
IS eResource Guide
IS Product News Roundup
New Products
New Products by Category
Abrasives/Brushes
Chemicals/Lubricants
Cutting Tools
Hand Tools
Hose and Accessories
Maintenance and Cleaning Supplies
Material Handling Equipment/Supplies
Power Tools
Power Transmission / Motion Control
Safety Supplies
Welding
Miscellaneous
New print subscription
Renew print subscription
Change of information
ShareThis Copy and Paste