Every month, Flowwow Sellers receive compensation for promo codes redeemed by customers. However, the algorithm has changed — from now on, the compensation amount to be credited will be partially or fully offset against Flowwow service fees, i.e. platform fees. This helps to optimise reporting and withdrawals for sole traders (IP) and limited liability companies (LLC). For more details, please keep reading this article and refer to the new edition of the Terms and Conditions of the Flowwow Loyalty Program.
The new algorithm applies to the following countries: the European Union, Turkey, the United Kingdom, Kazakhstan, Georgia, and Armenia.
New terms
To make it simple, in this article, we will be using the following two terms.
Promo amount means the amount of promo codes and bonus points (i.e. Bonus Point Rewards) for the previous month that shops are compensated for by Flowwow.
Total fee amount is the total amount of fees charged for the previous month inclusive of the following.
- Flowwow's fixed platform fee.
- Variable fees.
- Additional variable fees (applicable to order surcharges, if any).
- Other applicable fees as per the Public Offer.
Apart from these, now there’s a new entity — Partner Points. Partner Points will appear in financial statements as credits and debits.
Calculation method
So, the Promo amount will be offset against when calculating the amount of fees Sellers are charged for Flowwow’s services — partially or fully depending on the Promo amount.
- If the Promo amount is ≤ 50% of the Total fee amount.
- If the Promo amount is > 50% of the Total fee amount.
If the Promo amount is less than or equal to 50% of the Total fee amount, then the whole Promo amount will be counted towards fees, resulting in a zero compensation amount for promo codes and bonus points redeemed by customers.
If the Promo amount is more than 50% of the Total fee amount, then 50% of the Promo amount will be counted towards fees, and you will be credited the remaining balance as a bonus for awarding Bonus Rewards (promo codes, bonus points).
Since the calculation method changes, these changes will be reflected in financial statements as well. The Withdrawals Financial Report will show details of crediting and debiting Partner Points.
Next, let’s take a look at two examples to give you a better idea of the calculation method and the principles of report generation.
Case #1. The Promo amount is ≤ 50% of the Total fee amount.
Input data.
The Total fee amount for August 2024 is USD 50.
The Promo amount for August 2024 is USD 10.
Calculation.
In this case, 50% of the fees is USD 25. USD 10 is less than USD 25, therefore, the entire Promo amount is deducted from the Total fee amount the Seller is charged for Flowwow’s services.
Financial reports. Crediting and debiting Partner Points.
The total balance of the promo account is USD 10. At the same time, you could have several customers who redeemed promo codes and bonus points. Every time a promo code is redeemed for each order, the financial report will show an entry saying ‘Crediting Partner Points’.
For example, you had three customers with different promo code amounts: USD 5, USD 2, USD 3 , which in total amounts to USD 10, as described above. The report will reflect this as follows:
- +5 — crediting points.
- +2 — crediting points.
- +3 — crediting points.
- −10 — debiting points.
- Withdrawal — USD 0.
Thus, a new entity appears in the Orders Financial Report—‘discount on the Flowwow service fee for August 2024’, and for Case #1 the discount amount reflected in the reports will be USD 10.
To put it simply, the entire amount of compensation for promo codes and bonus points redeemed by customers in August goes towards the Flowwow service fee (offsetting). This means you don't receive monthly compensation for promotions, but at the same time you pay lower platform fees—reduced by the Promo amount.
Case #2. The Promo amount is > 50% of the Total fee amount.
The Total fee amount for August 2024 is USD 50.
The Promo amount for August 2024 is USD 30.
In this case, 50% of the fees is USD 25. USD 30 is more than USD 25, therefore, the maximum amount to be deducted from the Total fee amount is USD 25. Thus, the promo account balance will not show zero available for withdrawal. Instead, it will show: USD 30 − USD 25 = USD 5.
Financial reports. Crediting and debiting Partner Points.
The total balance of the promo account is USD 30, but it may be a sum of promotions for several orders. For example, USD 10 for one order and USD 20 for the second. The report will reflect this as follows:
- +10 — crediting points.
- +20 — crediting points.
- −25 — debiting points.
- Withdrawal — USD 5
Thus, the Orders Financial Report will also show a new entity — ‘discount on the Flowwow service fee for August 2024’, which for Case #2 will amount to USD 25, while the amount available for withdrawal for promo codes and bonus points redeemed by customers will be USD 5.
To put it simply: 50% of the amount of compensation for promo codes and bonus points redeemed by customers (USD 25) goes towards the Flowwow service fee (offsetting). In this case, you receive compensation for promotions in the amount of USD 5 and at the same time you pay lower platform fees—reduced by USD 25.
