How to Use the Rebate Type Net of Rebates

In the Rebate Payer module, there are various rebate types that can be utilized to calculate rebates or fees for various business scenarios. This article will focus on the Net of Rebates rebate type.

The Net of Rebates rebate type would be used for business scenarios where a percentage based rebate is calculated by first netting out another rebate for the same customer from the contract sales and then applying the rebate percentage. We have seen this most commonly used in the scenario where an indirect customer has both a differential (price billback) and an admin fee, but the differential rebate payment must be netted out of the sales prior to the admin fee being calculated.

TERMS

Parent Rebate: this is the percentage based rebate that will be calculated net of other rebates selected.

Child Rebate(s): these are the rebates that will be netted out of the parent rebates' calculation.

NET OF REBATES REBATE SETUP

Any rebates you wish to net out of this rebate should be set up in iContracts first

Rebate Payer -> Rebate Maintenance -> Add

Select the customer that the percentage based rebate is for, this is typically the owner of the contract that will contain the sales for this rebate.

Select the rebate type NET OF REBATES.

Select the rebate frequency applicable for this rebate. (NOTE this should either be the same frequency OR lower frequency than the rebate you plan to net out of the calculation)

Click GO.

Add in your rebate description.

Select the applicable MOP (mode of purchase) for the sales this rebate will be calculated on.

Select the applicable Start Date and End Date for this rebate.

Enter the overall Percent for this rebate, if applicable.

Select Auto Add Contract Products, if applicable.

Select any applicable Government Pricing exclusions.

Select either Pay AR or Pay AP depending on which interface the payments for this rebate should flow through.

Select GL Code or Rebate Group, if applicable.

Click SAVE.

 Next, navigate to the Product tab.

Select the Contract that the sales for this rebate should be calculated on. If multiple contracts are eligible, repeat as needed.

Click GO - products available on this contract will be displayed.

Add the applicable products for this rebate by selecting the checkmark next to the product line.

Click SAVE.

If this rebate calculates on an off schedule, this can be entered on the Rebate Schedule tab.

If this rebate is calculated based on tiers, this can be entered on the Rebate Tier tab. 

Navigate to the Select Rebates tab - this is where your child rebates will be selected.

Enter filter for Rebate Id or Customer Id that the child rebate(s) is associated with.

!IMPORTANT! Remove the checkmark for "Show Associated Rebates" prior to clicking GO. This is a commonly missed step.

Click GO.

Select the applicable rebates that you wish to be netted from this rebate by selecting the checkmark next to the rebate id.

Click SAVE.

If any sales adjustments should be excluded from this rebate calculation, this can be done on the Exclude GL Code tab.

IMPORTANT NOTES

• Multiple child rebates can be selected and these rebates can either be percentage based or per unit amount based.
• When calculating a NET OF REBATES rebate, a pop up will be displayed that shows any child rebate calculated amounts that will be included. If a child rebate has not yet been calculated, this will be calculated first prior to the NET OF REBATES being calculated.
• Prior to approving a NET OF REBATES rebate, all child rebates selected will first need to be approved.