Back to Basics: Overage


Last week, I answered some frequently asked questions about multiple coupons. In this week’s column, another beginner has a question about coupon overage – when the value of a coupon exceeds the cost of the item you’re trying to purchase.

Dear Jill,

If retailers get reimbursed for the face value of a coupon, why do some reduce the coupon’s value when it exceeds the cost of the item you’re purchasing? This seems like coupon fraud. The store profits by cheating the shopper out of the full value and pocketing the difference. One nationwide retailer gives the full coupon value to the customer, no matter what the sale price of the item may be, and it’s spelled out in their coupon policy. This is something that really bothers me, and I am hoping you will have the answer. - Mindy C.

Dear Mindy,

Coupon overage can be a tricky topic. If I have a $4 coupon for a product that is on sale for $2.99, I’ll take it home for free. But what happens to that extra $1.01? Do I get that back, or does the store get to keep it?

Both answers are correct. The store may opt to keep the overage, or it may pass the overage to the customer.

If a store keeps the overage, the value of the coupon typically will be adjusted to match the selling price of the item. But, as you noted, the manufacturer will reimburse the store for the entire value of that coupon, so the store makes an additional profit on your purchase.

While this may not seem fair, it’s the store’s right to determine how to handle overage. Keeping it may help a store offset losses from shoplifting, for example. Supermarkets operate on very small profit margins, so overage money helps the bottom line.

Of course, your store may opt to give coupon overage back, to the delight of shoppers! This typically happens one of two ways. The store might return the overage in cash. Or the store might automatically subtract the value of the coupon and let you immediately apply it to other items you’re buying in the same transaction. Let’s say that I buy a $2.99 item with a $4 coupon, and I also buy a second item that costs $2. My total at the register after the coupon is 99 cents. The register automatically applies the $1.01 overage to the second item.

In my experience, the cash back policy is not typical, although one major supermarket chain uses it. To determine how your store handles overages, ask at the service desk or look online.

Even if it is your store’s policy to give cash back for an overage, note that some coupons may carry the statement, “If the value of the coupon exceeds purchase price, cash should not be given back to the consumer.” The manufacturer is entitled to specify limits and restrictions on its own coupons. And in this case, the manufacturer clearly communicates that it will not reimburse the store for more than the actual sale price of the item.

No matter how your store handles overage, don’t get too caught up worrying where the additional money goes. Whether the store keeps it or you do, you’re still getting an item for free – and that’s always the best price!

 

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