You receive coupons in the mail or online, you clip them, you hand them over to the cashier…and then what? If you’ve always wondered about the coupon process, make discoveries below!
Where your redeemed coupons go
- The cashier scans the coupons in when you pay and generally places them under the cash drawer. Most cashiers are responsible for balancing the money in their till at the end of each shift, and they usually are responsible for counting the value of the coupons in addition to the cash. Although, some cashiers I’ve asked about this say they actually don’t have to count the value of their coupons.
- The store manager will collect the week’s manufacturer coupons and then mail them either to the store’s headquarters or straight to a coupon clearinghouse.
- Clearinghouses are huge centers where coupon values are scanned and totaled so that stores may receive reimbursement checks from the manufacturer. Over 90% of clearinghouses are located in Mexico. Though mostly a practice of years past, some coupons are even sorted by paid US state prisoners.
- At the clearinghouse, coupons will first be sorted by manufacturer or the party responsible for reimbursing the coupon’s value. For example, imagine all of the Procter and Gamble coupons from Kroger being sorted from the General Mills, Kraft, and Unilever branded coupons also redeemed at Kroger stores. Next, the sorted coupons are placed on a conveyor belt where a large scanner totals the value of all those coupons. Clearinghouse workers have to ensure that each coupon is counted. I can imagine that some worker is swearing at me right now for all the coupons that I didn’t cut very precisely!
- After all the Procter and Gamble coupons redeemed at Kroger stores are scanned, then a total reimbursement value is determined. The manufacturer will receive the data from the clearinghouse and will then write the check to Kroger: either to the regional office or to the individual store, depending on how the coupons were sent. This whole redemption process generally takes one to two months.
- Manufacturers ask stores to provide “proof of purchase” for nearly all types of coupons. Manufacturers require stores to submit supplier information, product purchase receipts, and product movement reports. Keep in mind that this proof of purchase is from retail stores. Manufacturers want to make sure that the retailer’s customers have redeemed the coupons and that the store is not just cutting Sunday newspaper coupons and submitting them as though redeemed by customers.
- Manufacturer coupons provide a handling fee, usually around $0.08, which is simply an additional fee the grocer receives for the trouble of accepting a coupon. If a small grocery store handles, sorts, totals, and invoices the manufacturer on its own, that stores keeps the handling fee in addition to the coupon value as reimbursed by the manufacturer.
- If a store uses a clearinghouse as addressed above, the clearinghouse cost is covered by the handling fee, and the store is reimbursed for the coupon’s face value.
- Some larger grocery stores still get a portion of the handling fee back from the clearinghouse.