A rebate is a type of sales promotion used by businesses, primarily as incentives or supplements to product sales. It is also said to be a refund of some fraction of the amount paid. It is an effective tool used for the promotion of products.
The most well-known and used type is the mail-in rebate. With these, the purchase of a product entitles the buyer to mail in a coupon, or a receipt and barcodein order to receive a check for a particular amount. This amount depends on the product, time, and often place of purchase. Originally, this was a way for manufacturers to encourage sales, by giving the money directly back to the consumer, rather than the retailers keeping it.
Rebates are now offered by either the retailer or the manufacturer of the particular item. Large stores often work in a secret agreement with manufacturers, often requiring two or even three separate rebates for each item. Manufacturer rebates are now often valid only at a single store. Rebate forms and special receipts are printed by the cash register on a separate receipt.
Rebates are heavily used for advertised sales in retail stores in the United States, such as Best Buy and Staples. Personal computer components and electronics make up have a large portion of rebate sales.
The turnaround time is generally four to eight weeks, if the rebate is refunded at all. Most rebates are handled under contract by companies that specialize in doing so. Their fees are covered by the customer’s money that the manufacturer or retailer keeps.
Although rebates are known to be a deceptive method of advertising, it cannot be denied that they greatly boost the number of sales. Today, more and more stores and companies have begun adopting the idea of rebates to promote sales and attract shoppers.