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Co-Opportunities In Advertising

Getting Your Share

The first step in taking advantage of co-op funding is finding where the money is. There are three good sources of information:

1. Your suppliers. Suppliers and manufacturers' representatives will often volunteer information about their co-op funding programs, but not always. Ask each of the reps you deal with about any co-op funding that may be available and the steps you need to take to apply for it.

2. Advertising representatives. The sales reps at the newspapers and radio and television stations you advertise with may be familiar with sources of funding used by other clients, and may be able to point you in the right direction. Be alert, as well, to the ads you see and hear. Whenever a manufacturer's name is mentioned in a store's ad, you can be sure the store owner took advantage of co-op money.

3. Your business colleagues. What co-op programs are other businesspeople using? Find out from colleagues who operate similar businesses or from trade associations for your industry.

The second step is applying for the funds you qualify for. Vendors who offer co-op funding establish rules you must comply with in order to be eligible for co-op reimbursement.

For example, many co-op programs forbid putting competing merchandise in a co-op ad. Others require approval of your advertisement before it's run. Most co-op requirements include stipulations on the types of media that are eligible (i.e. newspaper advertising may be eligible, but not Yellow Pages ads).

After your advertisement runs and you've provided proof of your compliance with the program, you'll be reimbursed, typically in cash or credit toward future invoices, for a portion of the total advertising cost, up to a preapproved dollar value. For example, a vendor may offer to repay you for 50 percent of the cost of any advertisement run that meets the co-op requirements of the manufacturer.

There are many variations on this reimbursement scheme, so it's critical that you understand each program before you purchase your advertising. Also keep in mind that reimbursement from the vendor usually takes between 30 and 60 days from the time you submit your invoice and proof of compliance.

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This article was originally published in the February 1996 print edition of Entrepreneur with the headline: Co-Opportunities In Advertising.

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