Rebates

Deal or No Deal?

Redeeming a mail-in rebate looks like an easy process at first glance.  When you buy a product that offers a rebate, you send in the required documentation and receive a check in return.  However, more consumers are having trouble getting their rebate checks.  According to the Council of Better Business Bureaus, the number of complaints has tripled in just three years, from 964 in 2001 to 3,641 in 2004.

Why do so many companies use rebates?

Nearly one third of all consumer products and 20 percent of electronics, such as digital cameras and printers, are sold with rebate offers, according to the NPD Group, a marketing research company.  Rebate offers attract consumers because the offer makes the price seem much lower than normal.  In fact, companies would rather use a rebate in place of a “sale” to increase the attractiveness of their products, because they know so many buyers will not redeem the rebate.

Consumers often forget to submit the claim for a rebate or decide that it is not worth the time and effort.  A company will also make the rebate submission process complex to increase the chance the consumer will miss a step and be deemed ineligible for the rebate.  When that happens, the business retains the full purchase price paid by the consumer.

The rebate process

Usually the consumer mails in the completed rebate form, receipt and original bar code (UPC).  Four to 12 weeks later, a check arrives in the mail. 

What can go wrong?

  • Many rebate offers have a window of eligibility.  You must purchase the product between certain dates and submit the rebate within a specified time frame.
  • Problems can arise because there are three parties involved—the manufacturer, the retailer and the fulfillment center.  Fulfillment centers typically handle the paperwork; they receive the UPC codes, receipts and rebate forms and then process the rebates.  Consumers often do not know where their check is coming from.  This makes it difficult to find out what happened with the rebate and how to get the check.

The downside of rebates

  • You pay the full price up front and then have to wait to get the money back.
  • You have to pay sales taxes on the paid cost of the item, and the tax is not included in the rebate amount.
  • A company can refuse your rebate submission if it’s not done according to their instructions.
  • If it gets rejected, you may have to resubmit paperwork or prove you sent all the necessary papers.
  • Retailers may not take back the item if it’s been opened or the UPC code has been cut out.  Therefore, you may have to choose between submitting a rebate that requires an original UPC code or returning the product.

Get the check

Here are some tips to help you get your rebate:

  • Read the rebate eligibility and redemption requirements carefully before you buy the product.  If a retailer advertises a product with a rebate offer, it must also have the correct rebate submission forms available.
  • Look for the expiration dates.  Sometimes a rebate may still be advertised by mistake even if it has already expired.  Also look for rebate submission deadlines, since many state a specific time period for purchasing the product and submitting the rebate.
  • Redeem the rebate as soon as you can.
  • Always read the instructions and fill out the form completely.
  • Make copies of everything you are submitting; this is your proof in case something is lost.
  • Send all documents specified and make sure they are the correct items.  You’ll probably want to attach the UPC bar code to the rebate form, but check the instructions first.  Some companies will not accept the UPC if it is stapled.
  • Send the rebate submission by certified mail with delivery confirmation and return receipt (especially if it is for a large amount).
  • Check on the status of your rebate online if possible.  If the rebate does not arrive in the time promised, investigate and complain immediately in writing to the fulfillment house, manufacturer and retailer.
  • If your rebate was denied and they claim you forgot to include some paperwork, send in your copies of what you submitted.  Be sure to keep another copy for yourself.
  • If the rebate never arrives or arrives late, and you have not received satisfaction after having submitted a written inquiry to the company, the manufacturer and the fulfillment company—file a complaint with the Federal Trade Commission (FTC) and your local Better Business Bureau.  Legally, a company must send the rebate within the specified time period.  The FTC has fined a handful of companies for failing to pay rebates to consumers or for paying them late.  

Savvy shopping strategy

A rebate can be an added bonus when purchasing a product you need—but the fact that a product has a rebate offer does not in itself mean you should buy it.  If you can’t afford the item without the rebate, wait until you find a comparable product for a lower price.  Compare prices among different retailers.  You might be able to find the same product with a lower upfront cost, without having to wait for a rebate that may never arrive.

Sample Letter to Business Regarding the Failure to Honor A Rebate Request