ABCs of Couponing, A is for All About How Coupons Work

UPDATE: I am re-posting this for those who are new to couponing

Have you ever worried you are costing a store money by getting freebies? Or how exactly getting free items with coupons can be legal and ethical? Let’s start at the very beginning:

Manufacturer’s create food products, beverages, household and personal items. It costs a lot of money to do ads on t.v or elsewhere to inform consumers of these products, so another form of advertising for them is a coupon. Manufacturer’s create a coupon for an item to get the word out about the product, and get it directly in the hands of the consumer. They want you (the consumer) to use the coupons. What a better way to get the word out about your product then having people try it out!

Manufacturer’s pay for the coupon to be distributed in Sunday coupon inserts, online, or through magazine ad placements. This is to get the coupon in your hands.

After you get the coupon in your hands, you create your shopping list and may even choose to use the coupon. After you scan your coupon on the register, the store takes the amount off the total purchase. You are stoked – if you follow my site, you may have just scored a freebie by combining a store sale/coupon with the manufacturer coupon! But the store is not reimbursed yet. The coupon is sent to a coupon clearinghouse to verify it was used correctly.

What is a coupon clearinghouse?

A coupon clearinghouse is a third-party independent of the manufacturer and the store the coupon was redeemed at. They determine the amount each manufacturer owes each store. The manufacturer takes the “hit” for the coupon, not the store. The store should get reimbursed for the amount of the coupon…but…if you scan a coupon on the wrong item, the coupon clearinghouse may find out and decide the manufacturer doesn’t owe the store that amount for that coupon. Also, if a coupon is a photocopied coupon, the clearinghouse will know and will not reimburse the store for the coupon. This means if you use coupons fraudulently, stores don’t get reimbursed and they lose money. That is stealing from the store! Some stores have already decided that too many fraudulent coupons are being used, and they have stopped accepting coupons printed from the internet because they are worried they are photocopies and won’t get reimbursed. So please don’t photocopy coupons; as a general rule, coupons can usually be printed twice online and should never be photocopied.

Store coupons (coupons released by a store) are not reimbursed by the manufacturer. The store releases these to attract customers. We’ll talk more about why you can “stack” a store coupon or sale with a manufacturer coupon in the next ABC’s of couponing story.

It’s not all bad news for the stores! Many people uses manufacturer coupons legitimately and stores are getting reimbursed by the manufacturer – plus eight cents for handling. Manufacturer’s are getting their products in the hands of consumers and are happy their ads were successful. They hope once a consumer tries a new product, they may try it again even if they don’t have a coupon next time. Consumers are getting to try products they may have never tried before at great prices. In the end, if coupons are used properly then the consumer, manufacturer and store are stoked. Using coupons to score freebies can be done completely legally and ethically without hurting anyone involved!