What is a "ratcheted" rebate scheme?

[Globalti]

Can anybody explain the reason for this seemingly over-complicated scheme and why accountants think it is better than simply granting a percentage end of year rebate based on the customer achieving purchases up to certain bands?

(I'm a non-mathematician - got a CSE grade 6 - my FD is insisting that his ratcheted scheme should be proposed to our customer but can't seem to explain to me why, in terms I can understand)

 

[Archie_tect]

Sounds like what you've described is what he calls it?

 

[Globalti]

I'm hoping a classically-trained accountant on here will come back with an assured and clear explanation of a ratcheted rebate scheme and why it is better than simple turnover bands.

Ever since childhood, maths has brought a red mist down on me and being 56 I find that my intellectual powers are waning as fast as my physical powers, so I'm not ashamed to admit that this (probably simple to an accountant) scheme has got me flummoxed. The problem with clever accountants is that they can't explain things in simple terms to dummies.

 

[accountantpete]

Its a Spend Threshold Bonus - it's all businesspeakcrap which usually has nothing to do with accountants and probably emanates from the sales dept.

 

[Fab Foodie]

It's because everything has to be needlessly complicated these days ....

 

[ceepeebee]

that'll be all about the sales team yes. Every place I've worked the accounts department has been dead against any rebates at all - they make life complicated.

 

[Globalti]

The opposite here - this bright idea came from the FD while the model we use in sales is simple percentages against bands.

 

[threebikesmcginty]

It's because everything has to be needlessly complicated these days ....

Just a simple fellow trapped in a convoluted and labyrinthine world, like a ickle bunny caught in the headlights of 21st century life - you poor old sod!

 

[ceepeebee]

The opposite here - this bright idea came from the FD while the model we use in sales is simple percentages against bands.

blimey, you want to watch him.

 

[Globalti]

He's Jewish and probably the cleverest, most argumentative man I've ever known. Too damned clever actually.

 

[Fab Foodie]

Just a simple fellow trapped in a convoluted and labyrinthine world, like a ickle bunny caught in the headlights of 21st century life - you poor old sod!

There's a truth in there somewhere ....