Geeks With Blogs
Liam McLennan
Lately I have noticed a trend in electronics retailing. Shops have started selling a large number of items with cashbacks. Here is an example of what I mean. Cashbacks are provided by the wholesaler to the consumer as a means of passing on discounts in a way that cannot be absorbed by the retailer. For example, if the wholesaler discounts the cost of an item by $250 what is to stop the retailer absorbing the $250 as additional profit? But if the wholesaler offers a $250 cashback then the consumer is theoretically protected from the retailers opportunism.

I strongly dislike cashbacks. They are effectively an interest free, indefinite term, loan from the consumer to the wholesaler. Instead of the vendor asking the consumer for money in exchange for goods the consumer is left asking the vendor for their own money back. Frankly there is very little compelling the vendor to actually pay the cash back. Here is an exerpt I received from Sony after I tried to claim a cashback for my television:

We've sent you this email to let you know that we have received the information you sent us in order to claim CASHBACK.
However, the following problem(s) have been identified with the cash back claim(s):

Claim XXXXXX - $150.00 cash back for BRAVIA TV Model:KDL40D3100 -
We did not receive the section of the product packaging showing the product serial number.

This email was sent without any contact details that might be used to resolve the problem. Of course the problem is that they did receive the serial number in question. I cannot resend the piece of packaging that I have already sent to them. The lack of contact information in their email is what annoys me the most. The message is clearly that they will resist paying as much as they can.

When important things go missing, such as the piece of packaging required to claim a $150 cashback, it makes me wonder if someone has found a way to beat the system. Posted on Wednesday, May 21, 2008 7:56 PM | Back to top

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