Be a Confident Shopper by Understanding Coupons…
Have you ever really took the time to look at your coupons and wondered what the heck all those different codes and numbers mean?! Well, my goal today is to break down the “secret” coupon codes, so that you are more confident and educated when using your coupons! Please note that I am in no way trying to provide information that allows you to use coupons inappropriately or for an unintended use!
A typical coupon barcode looks like the image below on the left that says “UCC Coupon Code”:
(Thanks to AccuGraphiX for this image)
UCC Prefix – This portion of the code will be either a 5 or a 9. It deals with doubling. If your store doesn’t double coupons, then this number has no purpose. If your store DOES double coupons, then any coupon coded with a 5 will double (up to your store’s doubling limit) and any coupon coded with a 9 will not double.
UCC Company Prefix – These numbers identify the manufacturer of the couponed item and MUST match positions two through six of the UCC Company Prefix on the product that is being purchased (this is the way that the register can validate you are purchasing the right product(s) for the coupon being used).
Family Code– Most manufacturers break their products into families and the family code allows the coupon to be coded for a specific product that the manufacturer sells (i.e. Crest may have a coupon that is only good for Crest Pro-Health Toothpaste so the family code on the coupon would validate this at checkout and would beep if you purchased a different variety of Crest toothpaste).
Value Code-This code tells the register what you need to purchase and how much to take off at checkout. The are over 100 value codes, so I will not be listing them all. Here are some examples:
00: Free product Coupon– will beep and require the cashier to manually input the amount to take off.
14: B1G1
50: $0.50 off
99: $0.99 off
*Keep in mind that coupons will occasionally scan successfully for items not listed on the coupon or even excluded by the terms written on the coupon. Just because the coupon scans does NOT mean that it is okay to use coupons for unintended items…this is actually coupon fraud and is illegal!
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OK, so now that you understand coupon coding, do you really know how the process of coupon redemption works for stores?! What do stores do with those stacks of coupons that they collect from all of us savvy shoppers?
Coupon Redemption Process:
-Manufacturers design coupon promotions with their sales/marketing teams
-Coupons are distributed via newspaper inserts, direct mail campaigns, via the internet etc.
-A very “hip” shopper excitedly enters the store and proudly uses all of his/her coupons at checkout 😉
-The cashier scans the coupons and puts them into the cash drawer. Typically, at the end of the day the coupons in each cash drawer are added up as if they were cash, and that amount is added to the cash sum to be sure the overall total for the drawer is accurate.
-Once per week, all of the manufacturers’ coupons (and any coupons issued by the grocer) are sent in plastic bags or pouches to the store’s corporate headquarters.
-There is a very lucky person at headquarters in charge of processing the coupons. That person boxes all of the bags of coupons and ships them to a third-party clearinghouse.
-The clearinghouse is then responsible for doing the most important part of the coupon redemption process– separating the coupons by manufacturer or by scannable coupons versus damaged/torn coupons. Most of this process is done by hand. Sometimes coupons are put face up on a conveyor belt and move under a scanner that reads the UPC codes and tallies the amounts. However, damaged and torn coupons have to be tallied by hand. The clearinghouse then sends all the sorted coupons with an invoice to the manufacturer.
-The manufacturer will reimburse stores the face value of coupons or if the coupon calls for free merchandise, for the retail-selling price up to the stated maximum value printed on the coupon PLUS 8¢ for handling each coupon properly redeemed (this 8¢ value may vary slightly). Many times manufacturers, such as ConAgra Foods, will also reimburse retailers that are using a clearinghouse or billing agent at a rate equal to $5.50 per thousand of coupons redeemed.
-The manufacturer either reimburses the clearinghouse for the amount of the invoice, and the clearinghouse mails a check to the store for the amount of the coupons OR the manufacturer sends a check directly to the store and the store then pays the clearinghouse. (The clearinghouse is paid a certain amount per coupon by the store, plus shipping and handling).
(Thanks to HowStuffWorks for some of the info on explaining the coupon redemption process!)
You can view a visual diagram of the coupon life cycle here and/or check out an example of the coupon redemption policy for ConAgra Foods here.
Here are a few interesting fact on coupon use in 2009:
-With a sour economy, consumers used 27% more coupons in 2009.
-Brands issued 367 billion coupons, at an average face value of $1.44 (That’s a total of $528.5 Billion)!
– Out of those coupons above, a total of $3.5 billion worth of coupons were redeemed.That sounds like a lot, but compared to the $528.5 Billion that were available– that’s less than .7%!
(Facts credit: Coupon Info Now!)
OK, so now that I have thoroughly overwhelmed you with the coupon coding/coupon redemption process, I have a question for ya…would you be interested in seeing a visual depiction (i.e. video) of the life of a coupon starring me Collin, the coupon, starting at the “birth” of the coupon and ending at the “death” of the coupon? My wheels are turning about this topic and I may pursue it if enough readers are interested. What are your thoughts?
Interesting, I was just looking into this yesterday… and I searched the web for information…
Well, I would be interested in a visual demo of the coupon from life to death..
Thanks Collin!
Sounds like a fun video! In addition to your “life of a coupon” video, here’s an idea for a Follow Me Monday…”Q & A with Collin”!! We could submit questions to you and you pick some to answer for us.
As I was reading your description, I thought to myself that I would love to see this process. A video would be great!!
i would totally be interested in it!
I would watch it! I just thought about this yesterday on how this works. Where do you find a job to be the coupon girl who has to sort them out (haha I googled it last night) cause I wondered how much they made
Yes, I would like to see a video on the life of a coupon. I would also like to to know if the people in charge of processing and sorting all these coupons have a preference that they would like all couponers to follow ( I’d like to know what they like and dislike about coupons) and I would really like to know about stores and checkers (both friendly & unfriendly) attitudes about coupons. Why is there just so much discrepancy between stores and checkers – what makes coupons such a “big deal” to some stores & checkers. Do all retail places know of coupons before they are released? Could stores eventually have an instant verification for veri-FI internet coupons so we as couponers are not hasseled so much?
I think you could do a wonderful job of showing us the lifespan of a coupon.
P.S. If there is a place where we could mail our expired or close to expiration date coupons to benefit a charity/people/etc I would like to know that too.
https://couponing.about.com/od/seasonalsavingszone/a/militaryexpcou3.htm most military bases over seas will accept expired coupons
That’s perfect Mary, thank you!
Having been a cashier at a grocery chain for 10 years, I can tell you it’s just a matter of the cashier having common sense and being a good employee. If a coupon didn’t go through, I’d ask the person “Did you buy ____?” and they would either say yes or no. If a bunch of things beeped, I’d start checking for items. After finding one that beeped, I’d push the rest through. That’s being a good employee. You can tell the people who are scamming you. Now for common sense….well, we all know that’s hard to come by. You shouldn’t have to be educated on company policy by your customers! What I was told is that there MUST be a valid expiration date AND the paragraph at the bottom of the coupon so they know where to send it for redemption. I had no problems with people using coupons, even back in the day when I had to add them all up in my head before taking the total off their bill. 🙂
I think that would be awesome. Especially because you occasionally get the cashier who has no clue how coupons work and could use a little “education” themselves.
That would be interesting to see. I think it should be a mandatory course for all cashiers around the world lol! But seriously it would help them understand the power of a coupon and all that it can do! I know being very deep right now.
Wowza! That’s neat!
I would love to see a video. The ins and outs of how stuff actually works is very interesting to me!Thanks Collin, your awesome.
WOW thanks for the info! good to know on the doubling and stuff like that!
I would love to see a video!
They’ve calculated the hourly rate of cutting coupons to be ~$86/hour. And so many people wonder how we save so much money!
Interestingly enough they also report that the individuals with a higher economic status are the ones that most frequently use coupons.
I loved this info. It was very interesting. If you are enthused to do a video, go ahead, but I don’t really need to see one. Thanks again.
I would love to watch a follow me video. It’d be really cool to see the inner workings of the clearinghouse.
I would definately be interested!
Would love to see that video. It’d be a great video for my kids to watch too!
I have always been under the understanding that my local grocery store actually MAKES money from my using the coupons. Not only do they get reimbursed the amount of the coupon by the manufacture – but the actually get paid 8 cents (amount varies) per coupon. Does ALL of that 8 cents get eaten up by shipping the coupons all around, or am I correct in thinking that the store actually gets some of that 8 cents as pure profit?
To me, if stores are making a profit – even if it ends up being 1 or 2 cents per coupon, they should be encouraging their use!
I doubt it. Think of the labor that they spend having the office girl (or whoever) sort through and add up ALL the coupons each week. Then the main office has to do that for ALL the stores. It doesn’t seem profitable at all to me. I worked at a grocery store for 10 years, and I remember our office girl having to recount stuff quite often. She also had to clip the coupons that were not clipped small enough. What a pain for her!
I’d love to see that video and share it with my children. It would be a good learning opportunity.
That was very interesting! I would also love to see on video how the coupon process works. Very educational!!
I would watch anything you would do! 🙂 I also liked the one comment about you doing a Q&A Monday video … I have one to submit … (because I know you too love this idea:))
You said one time, ‘ignore coupons that say they can’t be doubled, because they can’ … I need another explanation about that one… thanks Collin…
I want to see the people and equipment required to organize and add up all the coupons after they have left the store. That would be so cool! Please do the video!
I think that would be a fantastic idea! Your videos really are informative and I can’t wait to see the “Life & Death of a coupon” episode.
I would enjoy seeing a video on the whole coupon redemption process.
Thank you for the in-depth explanation of the coupon and “What do all those numbers mean?” I always am cordial to the cashiers-even if it is sometimes not reciprocated 😉 and when you speak from an educated standpoint-you have the confidence to back up your stance if there is an error. It would be interesting to see a video of the coupon process. I know you love your Starbucks- without your coffee the video will run for 5 minutes- with your coffee it will run 30 seconds! I love you Collin- lemons and all.:)
I find learning more empowers us, so if you find the time to video, I will watch.
Really interesting information. I thought I was pretty well educated on coupons, but I definitely didn’t know all the details of what each number stood for. I’d definitely watch a video on this if you made one!
wow, I guess that I’m the only one who thinks this would be boring. Sorry Collin- you are my #1 girl, but I’m just being honest. I have enjoyed the previous videos, and learned alot. I guess it would be educational, but to me -boring!
Thanks Collin for explaining this. About a month ago, I was very upset when the store wouldn’t take one of my coupons. My friend tried to explain what you just did, but I didn’t understand it. This really helps! I would LOVE for you to do a video on this…I just love watching your videos on my lunch break! Thanks for educating me on how to continue to Save even MORE and spend LESS!
I would love to see a video. Good idea.
I would be interested in a visual demo of the coupon from life to death! Your’e AWSOME COLLIN!
I would love to see a video showing the coupon life cycle! I love shows like that! You will be a “hip” Mr. Rogers twin. I always love seeing how paper is made, peppermint sticks are made, playdoh is made, etc., etc., …you get the idea. I can hardly wait!
I think that would help understand the process even more. The more knowledge we have the better we can present the “facts” to the sometimes clueless cashiers!!
Thanks for sharing – that was so informative.
I am really interested in this topic. I also want to add a suggestion for a Follow me Monday. I would love to see just a regular day with Collin. What your average day is like, how much time it actually takes you to find and post all of your amazing deals, How often do you go shopping (daily?), time with your family, etc. I guess I am just curious how you get all of this done because it seems overwhelming to me and I want to know how you have time to do all of this.
I would love to see a video about this. I spend so much time clipping, sorting & using coupons it would be good to see the process they go thru. Thanks for all the great info Collin!!
i would also like to see/read more info and what is illegal and fraud. “it is illegal to copy coupons, use more than two on one product,” etc. because i might be doing something that i am not supposed to.
YES!!! Your videos are always fun and uplifting!! I am sure to laugh!! 🙂
yes i really want to see it and how to defend your coupons that they are not copied or using them is not fraud,
I think a video would be very helpful! I’d be curious to find out how the store is financially effected by the use of coupons – like if they lose any money because the process is complicated, or if the 8 cents handling fee covers all their costs. Thanks, Collin!
Great idea, Collin! I’d LOVE to watch a video explaining the life cycle of a coupon (of course I work in Marketing/Advertising, so that may have something to do with it! 😉 ).
Oh yeah… I think that would be a GREAT video! I look forward to it!
I would love, love, love to see the life of a coupon!!! Thanks for all you do!!!
I really enjoy all your videos and this one sounds very interesting. Thanks! Collin.
Yes I would love that!!!!!!!!!!!!!!!!!!!!! Thanks
Very informative – thanks! It’s unfortunate that stores tend to give the hardest time over internet coupons b/c you have to believe that internet coupons allow companies the greatest profit. No printing or distribution, they just put them out there & make us do the work of printing them!
DO IT DO IT!!! I find this very interesting. Plus the more that we know about the process the better we will know how to handle ourselves at the register with difficult cashiers! 🙂
Hi Collin and the fellow bloggers/readers,
Very informative post. Would love to see the ins and outs of coupon redemption process. Also, like some other readers mentioned, would like to know do stores loose money or make lot of profit from people like us. The people working in clearinghouse can probabyly shed some light on it.
Thanks.
NO! I COULDN’T STAND THE “DEATH” OF COUPON COLLIN PART! 😉 Yes, it would be really interesting to see the actual place where they sort them.
Yes, I would love to see more information on Q’s.
Does anyone know how the store shows that they gave less than face value for a Q?
Example…a store give you .75 cents for your $1.00 Q because the item cost .75 cents……..ok thats correct….but how do they process that Q for .75 cents………OR DO THEY RECEIVE $1.00 FOR THE Q???????????