We started this series by stating that the conventional business model involving manufacturers, third party dealers and printing companies (the "end-user") is breaking down. We cited the rebate system in which printers can receive up to 40% or more in manufacturer rebate payments as one major symptom of this breakdown.

The manufacturer rebates, calculated as a percentage of projected or actual purchases of consumable supplies, are paid directly by the manufacturers or through their dealers in cash or, under restrictive covenants, as subsidies for equipment purchases or leases. In total, the rebates constitute a massive equipment financing program but without the normal safeguards or qualifications of collateral and credit rating. As a system of cash payments they fundamentally alter the roles and relationships of manufacturers, dealers and customers.

Because printers are the supposed beneficiaries of the manufacturer rebate process, we thought it would be important to begin this series of articles with some analysis and commentary on how printers generally view the rebate process, and how they use it to manage their businesses. With the help of WhatTheyThink.com, the first public forum that actively involves all relevant segments of the industry, we are now able to engage printers in the discussion of rebates.

We have begun to elicit information from printers that offers a fuller and more meaningful picture. As part of our inquiry, we addressed the following series of questions to printers: