A rebate on purchases is a type of discount applied to a particular volume of purchases by a company calculated on the basis of one year. The supplier guarantees its application to its buyers if they reach a certain level or volume of purchases during said period.
By definition, abseiling is usually understood to be a commercial discount based on a certain volume of orders by another company. The application of abseiling on purchases implies their loyalty , mainly.
If sales were made to the end customer, we would be talking about another similar concept, that of rappel over sales. Both cases must be taken into account in the accounting of the company.
Alternatively, the main idea of this type of operation is to bring client companies to higher than usual consumption levels . It is an incentive for potential customers to consume or buy a little more than normal and benefit from it through a discount.
The most common is that the commercial discount applied is directly related to the volume of spending in which we move. In other words, there is a directly proportional relationship between the customer’s expense (expressed through a volume of purchases) and the discount that will be applied by the supplier company.
For accounting purposes, a rebate on purchases can be applied on the same invoice or after the purchase. As we have said, the most common is that it be applied at the end of a certain period of time, which usually tends to be one year (although also quarterly or semi-annually) and in order to make it easier for companies and / or clients to close their fiscal year .
Any of these application modalities will have an effect on the accounting methodology, taking into account in turn whether they are payments made, pending or any other type of related circumstance.
Example of abseiling on purchases
A simple example of abseiling on purchases is carried out by mechanical and industrial washing workshops. For one year they offer the possibility of carrying out 10 commercial vehicle maintenance operations to companies in the sector with the condition that if number 10 is reached before the end of the year, said last operation of the voucher is carried out free of charge or at a lower cost.
In this way the company guarantees a volume of work, loyalty to the client company and offers the latter the possibility of reducing its annual expenditure on vehicle washes.