Should there be a law that rebates must be instant?

Great Debates
1

I am in the middle of an unsettling experience with a rebate. I purchased a $20 item thru the Internet (a reputable dealer, I think) with a $10 rebate. I filled out the forms, attached the invoice, and included the physical barcode from the retail product box as instructed.

8 weeks later, I get an email from the rebate service company. They claim that the barcode I sent was not a UPC code as the form requested, so they denied the rebate.

I have copies of all rebate forms, and the original product box. Checking the papers, I find that, sure enough, neither of the two barcodes from the box are UPC style (wrong number of digits, for one). However, there is absolutely no other barcode or UPC number anywhere on the box, any side. (It’s probably a Taiwanese special “clone” product.)

So the rules say “must be original UPC barcode” to get the rebate, but there is no original UPC barcode available to the consumer. Catch-22.

I have written both to the rebate servicer and the dealer, since it appears that 100% of the claims for this product will be rejected. What a scam. Let’s hope the dealer sets this right, or I will escalate it to some government authority just out of spite.

But this brings me to the OP: rebates are universally hated by consumers, regularly not redeemed, but frequently used as a sales tool when the advertisers know well that many (most?) purchasers won’t get the rebate either for reasons like the example above, out-and-out fraud by the rebate servicers, or consumers who don’t care for a measily ten bucks.

I am against the idea of “there oughta be a law” in principle, but in the case of fraud, laws may need to be passed to prevent it. And this situation is at least a borderline case of fraud, IMHO.

So should there be a law that all rebates must be given (or at least offered) at the time of purchase? It would make every transaction fair. The consumer would know at the register or checkout that they qualify or not for the rebate, and if there was a problem, it would be solved before the transaction was completed.

What are the implications of such a law?[ol][]Manufacturers would have to adjust the amount of the rebate offered to allow for a greater number of redemptions, and adjust for the reduced float, but see #2.[]Retailers would have to work out an arrangement with the manufacturer or distributor to be compensated for the instant rebate. Doesn’t sound like a big problem with electronic transfers and computerized billing. It’s a lot easier for a store to do this as a composite figure for one day’s sales than for each customer to do it individually. It would make the rebate centers go out of business, and perhaps the amount of rebate could be increased, since the administration cost would be less.[/ol]Does any state or country have such a law? Would it be a good idea?

2

My thought is that if there are several prices for an item advertised, such as the price before and after the rebate, the larger advertised price should be the one you pay at checkout.

Example of what ticks me off:

Instant Pangalactic Gargleblaster Mix ONLY $6.99!!*

*after $25 mail-in rebate when buying 400 or more

3

By “larger”, you mean the larger size type? I would think the fairest price would be the lowest in monetary value.

Damn, I must have missed that sale. I need some Gargleblaster mix; mine is only sub-galactic.

4

that’s because you probably use powdered tooth of Algolian Suntiger.

5

I was under the impression that some states already require that retailers either give the rebate instantly at checkout, or advertise the regular or sale price and mention that a mail-in rebate for $x is available, rather than advertise post-rebate prices.

6

No they shouldn’t.

That defeats the point of the rebate. The rebate is a clever little ploy to make it seem cheaper. They bank on the fact that not everyone will send it in, so they get to advertise a cheaper price than they actually will end up receiving. If you make all rebates instant there won’t be much of an incentive to give them out anymore. If you give out 20 dollar rebates they will only really cost you say 10 dollars, because maybe half the people don’t use them

7

Yes and no. I agree that life is complicated and time-consuming enough without having to deal with cutting barcodes, mailing rebates and dealing with deceiving prices.

The law should state that any rebate must be processed automatically at the point of sale, require 0 extra effort and time from the consumer, and be credited to the customer’s bank account or card automatically after the 6-8 weeks without any further action needed.

Also, not only should all prices exclude non-instant rebates, all prices should include sales tax in the final price just like they do in Europe and pretty much everywhere else on the planet.

8

I read an expose of rebate processing companies, and they provide guarantees to the manufacturers whose rebates they contract to process. The guarantees say at least a certain percentage of submitted rebates will be rejected. They will, of course, have to come up with some sufficiently plausible excuse for rejecting the rebates, but there seems to be no limit to how often they can accomplish that.

There are laws forcing people to make good on the rebates, but of course the laws just accomplish giving you a reason to sue somebody when they keep playing around with your $10 rebate, and a neglible fraction of people are going to try to take action to recover $10.

I think it is only reasonable to treat the price you pay before any rebates are processed as the only price you should consider when deciding if a product is worth buying. But it still galls me to have them telling me I’m going to get money back when I expect that I probably won’t.

It is a good idea to try to select vendors who don’t participate in this whole fraud.

9

But isn’t that fraud? And isn’t a good use of the legal system to prevent or reduce fraud?

As I stated in the OP, sure, the amounts may have to be adjusted with my new law, but at least it would be honest. The manufacturers won’t necessarily be on the hook for any more $ total, they can a just offer a little less for each rebate. And their costs would probably be less (no mailing costs, no redemption firm to hire), so they could offer a little more.

That would be sort of a compromise, but wouldn’t solve the original problem, at least from the consumer’s point of view. The consumer would still be obligated to keep track of what was owed and initiate a complaint if it didn’t arrive in the time alloted. And how many customers are going to make a federal case out of $5?

No, the law has to make the rebate paid at the time of the sale. If a store advertises a product for a $50 cost, what could be fairer than the consumer paying $50 (plus tax and shipping) at the register or checkout? Anything else says, Buy this widget for $50! But the chance of you actually getting it for that price is slim, and anyway, you will have to loan us $20 up front that you might not get back in 2 months. Sucker.

10

Simpler: no more rebates. They are bad. If they only banked on the fact that no everyone would send it n, that’s not so bad. But whaaaaaay too many have jumped through all the hoops to find out no rebate ever comes. That makes it a con.
I have *heard *that some states have so many restrictions on them they are basicly illegal.

11

I agree they are bad, but not that they should be made illegal. They are a sales tool. The manufacturer makes the offer of compensation to the consumer to move products. Making them illegal would make this impossible.

Why shouldn’t the manufacturer be allowed to offer a discount to a consumer? just make sure that what is offered actually happens. Then it’s not fraud. There’s nothing wrong with the concept, just the current method of execution.

12

I like the rebate scheme as it’s currently set up. Since many consumers don’t send in the rebate forms, manufacturers are willing to give larger rebate values for those of us who do send them in. It’s common for me to buy a $30 product with a $20 or $25 rebate. If the law mandated instant rebates, they would offer maybe $10 or $15 instead.

I see this as just another way for manufacturers to tier their pricing on the same items, to offer them at a lower price to price-sensitive consumers, while at the same time selling them at a higher price for those who are willing to pay a little more. Other examples of this are airline flights with a Saturday-night stayover, grocery store coupons, and the eight-ounce coffee at Starbuck’s.

13

Should there be a law that rebates must be instant? As noted that would remove the incentive to offer them, But better monitoring and prosecution of the abusers of the practice would be a good thing. However, its got to be pretty far down anyone’s list of things to actually do.

14

The only thing I’d legislate, if I could, would be how long the rebate checks are good for - I’d have them be valid for at least 90 days. Too often, they’re only good for some very short period of time, which you don’t notice until you get around to taking your checks to the bank, and find that the rebate check’s expired, because it was only good for 30 days after issuance, which turned out to be maybe 3 weeks after you got it.

15

The thing is, it’s too hard to guarantee the Manuf backs it up. They can always claim (like the OP sez) that some hoop wasn’t jumped through. Or they didn;t get it. Or they file Chaper 11 after get get a load of them. Or many other excuses.

If they actually paid off on them, no problem, but they far too often fail to perform.

16

How about just don’t buy things with rebates.

17

I don’t see the correlation to the short cappuccino. The difference is that you are paying for less product (milk) and in turn getting a better quality product. In the case of rebates, everyone gets the same product, only the lucky ones pay less. And, yes, I say lucky because it’s a fact that legitimate rebates have been denied.

18

I have been known to buy things that offer non-instant rebates. But only if I’ve decided the price I pay at the register is the exact amount I’m willing to pay. Essentially, I just ignore the rebate.

19

Hell, yes.

Any mandatory cost should be included in the sticker price. Hidden fees are not conducive to the full and open exchange of information that capitalism depends on. I’d be willing to let additional fees like shipping or other per-order charges not be displayed on each item, but they should be prominently displayed in obvious places, and on websites should not be hidden until the end.

20

The only things I’ve ever seen sold here with Rebates are Laptops and Printers, and in all cases the Manufacturers are good for the money , provided you don’t chuck the box out. (They want you to send the barcode in)

Personally, I think they should be done away with- none of this “pay $750 for the computer then wait 3 months for a $150 rebate cheque” nonsense. Just charge the customer $600 and tell them to enjoy their laptop.

Since everyone fills in rebates here ($150 is $150 no matter who you are), the entire exercise just seems pointless to me…