Reward Gateway's business model has been consistent and client-focused since we launched in 2006.
Our client is the employer and our customer is normally the HR leader, manager or director. We make almost all of our income from the annual fees employers pay us for running the service.
This transparent, honest and ethical business model is a significant reason why we've become so trusted by employers around the world.
Here are some key additional details:
SmartSpending™ has always been retailer independent
We pioneered the concept of retail independence in 2006 when we launched the world's first employee discount service that was funded exclusively by employer fees rather than wholly or partially by retailer commission, bonus or advertising fees,
In our unique model, all income from the retail side of the product is managed and tracked in a "Discount P&L" which we aim to run at zero margin. There are thousands of ins and outs to that P&L. Retailers pay us bonuses, commissions, on-target payments and in some cases part of an advertising budget. Our Discount P&L makes sure that all of that ends up one way or another in the hands of one of our employees.
Because of the way retailers pay us, it's impossible to match every payment back to a precise user, but if, for example, a retailer gives us an end of year bonus for reaching a certain level of sale, that goes into the Discount P&L and we can then use it to enhance rates at certain retailers for a time, to fund customer service payments or for any other short term promotion as long as it gets back to an employee user somehow.
That approach, where we focus completely on the user experience has been so successful that it has made us the largest customer for every single retailer in our two established markets of UK and Australia. It means that where we have any doubt we act in the interests of the user - i.e. the client's employee, not a retail partner. Our clients' staff come first, always.
Take a look at The SmartSpending™ Discount Charter
SmartAwards™ is paid partly by annual fee and partly by margin on awards
Our employee recognition products - which we collectively call SmartAwards™ - have always operated on a mix of annual fee and margin on awards. That's how we keep the price as low as possible for our clients.
So, if an employer buys a recognition product from us that includes financial awards that go to their staff, then they pay the face value of those awards. If one of their employees chooses to redeem that award on a retailer where we have a discount, then that discount margin is kept by us as a contribution to the running cost of the recognition service for the client. Some recognition products also have an annual fee, payable by the client.
Payroll benefit products are paid for by transaction margin or transaction fee
In the UK, we operate four additional payroll benefit products for our clients.
SmartTech™, SmartFit™ and Cycle to Work are all free to the employer and have no employee charges. Instead, we receive a commission from the suppliers involved, and that pays our costs.
For Childcare Vouchers, we charge the employer an admin fee, which is a percentage of the monthly voucher volume that their account uses. This amount varies depending on the size of the account but is always less than the Employer's National Insurance that is saved, meaning that there is always a net saving to the employer.
More information from Doug
For more information on Reward Gateway's business model, our very friendly CFO Doug Butler would be happy to help. His LinkedIn profile says he lives in San Francisco, which is true, but he travels a lot and he's often in our London and Boston offices.
Speak to one of our Consultants or Client Success Managers to be put in touch with Doug.