Channel Mechanics

Distributor Back End Credits (BECS) / Ship & Debit Programs

Enable distributors to execute programs from stock with financial assurance and a fully transparent claims process

Where vendors leverage distribution as part of their channel go-to-market strategy, it is normally the case that these distributors will hold inventory.

However, in order to deal with market conditions, vendors often need to offer additional discount greater than what they sold to distribution. In such cases, they need to make the distributors ‘whole again’ for offering this additional discount over what they bought in to inventory.

When this happens, distributors will make a monthly claim to get credit for the difference in what they paid for stock and what they were forced to sell at due to these additional discounts.

Managing these Back End Credit / Ship & Debit programs is quiet a complex task and often falls to the vendors finance team to deal with. They typically use manual processes such as people and spreadsheets to review each line of the distributors claims to try and reconcile the claim amount against their own records. This is error prone, time intensive, costly and generally leads to conflict between the vendor and the distributor, as neither party will be able to align.

Channel Mechanics offer a fully automated solution to execute these Back End Credit / Ship & Debit programs. The solution provides complete visibility to both sides on a line-by-line transaction level. The result drives enormous efficiency and complete transparency into the program and associated processes.
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Benefits of The Channel Mechanics Distributor Back End Credits Program

  1. Enable distributors to fulfil lower priced transactions from inventory and claim any adjustments once the order has been satisfied. Thereby allowing for operational continuity
  2. Both vendor and distributor have full visibility on the status of claim submission, validation and payment
  3. As the price promotions and sales programs eligibility rules are pre-determined, both distributors and vendors know the claims are already pre-validated in terms of the program rules.
  4. Enables significant ROI, efficiency, and scalability.
  5. Savings on Finance resources to manage the increasing number of claims.
  6. Enables ability to scale distribution in a cost-efficient way (no need to keep adding resources for manual validation as BECs rolls out to all Disti’s).
  7. Ease-of-Doing business with Distributors, fully transparency & less time spent on disputes.
  8. Ability to forecast accruals for BECs on a weekly basis.
  9. Reduces errors & eliminates over claims in a timely fashion.
  10. Automation of multiple complex discount rules.
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Key Features

  • Automate credit claimed vs. discount approved via configurable rules engine
  • Scale-up to validate thousands of lines a day/week easily
  • Accelerate the end-to-end process via automated workflow with dashboards for Distributors and Vendor
  • Full transparency and traceability for the Distributor and Vendor
  • Simplify the claim & rebate (credit memo) process via the dashboards
  • Automation for the credit memo generation is possible via API / integration
  • Provides a fully auditable process, down to the SKU level, from Discount approval (pre-sales), through Point-of-Sale, Credit Claim/Approval and Payment (credit)
  • Provides detailed reports for Accounting and Product Managers to enable visibility to true product discount/margin trends

Automate the management and workflow of distributor claims and rebates with the Channel Mechanics Distributor Back-End Credit & Rebates Program


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Related Ship and Debit Program Resources

Pricing Through The Channel Has Never Been So Complex

Because pricing through the channel has never been so complex, Jim Kelly looks at why Vendors and Distributors should care about Back-End Credits

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eBook: Top 10 Distributor Back End Credit System (BECS) Considerations

Download “The Top 10 Distributor Back-End Credit System (BECS) Considerations” eBook and watch as your channel grows through distribution

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Getting SPIFF's Right: Move beyond the old ways of doing Channel Incentives and Rebates

Vendors use SPIFFS or SPIF’s (Sales Performance Incentive Funds) to influence behavior with their channel partner sales teams.

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