How to Evaluate Your Current Merchant Rebate

Most dispensary owners can tell you what a customer pays to complete a transaction. Far fewer can tell you what their business earns from it, or whether that number is competitive. Here is a simple way to find out.

Find your effective rebate per transaction

Pull a recent statement and divide the total rebate you were paid by the number of eligible transactions in the same period. That is your effective rebate per transaction. It is often different from the rate you think you are on, because of how eligibility and adjustments are applied.

Annualize it across your real volume

Multiply your effective rebate by your average eligible transactions per day, then by roughly 30 days, then by 12 months, and then by your number of participating locations. That annual figure is the number that actually matters when you compare providers. Small per-transaction differences become large annual ones at real volume.

Subtract what you pay to earn it

A rebate is only meaningful net of cost. Subtract any monthly operating fees and equipment costs. A provider with no monthly operating fee can deliver more to your bottom line than one advertising a bigger headline rebate.

Judge whether it is competitive

“Competitive” depends on your volume and structure, which is why a single universal rate advertised to everyone is a warning sign rather than a benchmark. The right question is whether your rebate is being set to your actual operation, and whether you can see how it is calculated.

You can model an illustrative example with the calculator on this site, then bring your real statement to a payment review for an exact read.