Slashdot Mirror
Computer Rebates Not As Sinister As You Think
Lam1969 writes "Robert Mitchell dug up some details about rebates after getting up at 5 a.m. to get a free (with rebates) computer bundle at Circuit City. He had to deal with five separate mail-in rebates to get his money back, and decided to ask an expert about whether rebate come-ons are some sort of attempt to trick consumers. The reply: 'The big lie that the media and attorneys general want you to believe is that all the retailers and manufacturers are crooked and the reason [they] do rebates is breakage, which is people not turning them in.' Furthermore, Mitchell reports that retailers are making the process easier, by printing rebate forms and receipt copies at the register, and letting people track rebates online. His conclusion: The trade-off of having to do a few hours of copying and envelope-stuffing is worth the price of a new computer, so stop whining -- 'suck it up and accept your rebate check like a man.'"
You forgot two other reasons: One: So called Earnings. They can claim, as a company, to have sold x dollars of merchandise, which is the price of the goods going out the door. They look better on paper even though they have the oncoming cost of rebates. Two: balancing out the 30 day return. The rebates are often only sent out under the condition that there is no way to return the item under any sort of no-risk clause. Either they make you mutilate the box and forfeit the reciept, or they hold the rebate until after the return period has expired. This means they only give the discount to good customers who don't cost them by returning their junk.
:-)
Just off the top of my head
Having worked in retail for 20+ years, most of it at fairly high levels, I can tell you why manufacturers do rebates: retailers demand them.
"We're WallyWorld, and we control 99.867% of the retail market for your product. If you don't offer a rebate, we won't advertise your product, we'll advertise your competitor's product. In fact, we won't even carry your product."
Retailers want rebates because it lets them hold (and advertise the hell out of) a sale without actually having to put anything on sale. The retailer benefits from increased revenue from more selling product at full price to the marks, er, consumers, who think they're getting a deal.
The failure rate for rebates - the percentage never actually paid, even though they're sent in, is also quite high, because manufacturers don't like rebates much at all.