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Liabilities and Redemptions
Liabilities give you a way to sell store credit to customers that they can come back and redeem later. Learn how to set up liabilities in BackOffice, issue and redeem them at the register, and view reports on their usage.
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Table of Contents
What are Liabilities?
To understand how to use liabilities in ShopKeep, let’s define what they are and examine how they are used.
Liabilities are redeemable inventory items, such as gift cards, gift certificates, and deposits.
Revenue gained from issuing liabilities is kept separate from sales revenue.
The business is “on the hook for” liabilities until customers redeem them.
When a liability is redeemed, the sale amount is then counted as sales revenue.
Enable a liability tender in BackOffice, then create an inventory item to represent that liability. Once created, the liability item will be used to issue the liability to customers at the register.
In BackOffice, click 'Settings' and select 'Tenders'.
Under 'Redeemable', check a box to enable one of the liability tenders.
Visit our Tender Settings article to learn about the ‘Standard’ and ‘Additional’ tenders listed above.
Issuing a liability gives a customer credit which they can redeem in-store at a later point. Sell a liability item at the register to issue a gift card, gift certificate, or deposit liability to a customer.
Add a liability item to a sale.
If the liability is priced in store, enter its sales price and tap 'Done'.
Click to Enlarge
To complete the sale, select the customer’s payment tender.
Click to Enlarge
Redeem a liability when a customer returns to use their gift card, gift certificate, or deposit. Liability redemptions are similar to using other payment tenders to complete a sale.
Click the date icon to choose a preset or custom range, then click 'Retrieve'.
Toggle between 'Redeemed' and 'Issued' to view liabilities redeemed or issued.
To hide a liability tender, click the 'Show Tender(s)' drop-down and uncheck a box.
To show the tender again, recheck its box.
(Optional) Click 'Export' to download a copy of the report.
Read the Report
Learn to read the Gift Cards & Deposits report to understand the amount of new liabilities issued, the amount of liabilities redeemed, and the net liability amount still waiting to be redeemed.
Dashboard Tiles
The tiles at the top give a broad overview of liability activity.
New Liabilities | Total amount of liabilities issued over the selected date range. Redeemed Liabilities | Total amount of liabilities redeemed over the selected date range. Net Liabilities | New Liabilities minus Redeemed Liabilities.
Redeemed View
The default reporting view shows details on redeemed liabilities.
Date | Date and time a liability was redeemed. Tender | Type of liability that was redeemed (gift card, gift certificate, or deposit). Total Amount | Amount of the liability that was redeemed.
Issued View
Switching to Issued highlights how customers are purchasing liabilities.
Date | Date and time a liability was issued. Item | Name of the item that was sold to issue the liability. Quantity | How many of the liability item was sold. Linked Tender | Type of liability that was issued (gift card, gift certificate, deposit). Total Amount | Amount of the liability that was issued.
Deposits
This section walks through common scenarios involving deposit liabilities to show how to accept refundable or non-refundable prepayments/down payments.
In this example, we’ll look at keg deposits. Here, kegs of beer are sold for $75 and require a $25 deposit. The deposit is refundable upon return of the empty keg by the customer.
Enable the 'Deposit' liability and create a liability item called 'Keg Deposit'.
When the customer returns the empty keg, perform a return for the keg deposit.
Deposit liabilities will be reduced by $25 and the customer receives their deposit back.
Scenario 2
In this scenario, we’ll look at what happens if a customer does not meet the conditions of a deposit return (e.g. they don’t return the keg within 30 days or if it’s not in good condition upon return).
In addition to the items created in scenario 1, we’ll also create an item called ‘Keg Deposit Not Refunded’. This item will be used instead to convert money received from the ‘Keg Deposit’ liability item into sales revenue.
Create an item called 'Keg Deposit Not Refunded' and set the sale price to $25.
Or, set the item’s ‘Price Type’ to ‘At the Register’ to be able to enter the price at the register.
This is not a liability item, so do not select a liability tender.
Complete a sale for the 'Keg' and 'Keg Deposit' items as shown above in scenario 1.
If the customer does not meet the requirements for a deposit refund, follow below to convert the outstanding liability into a sale.
Ring up a sale for the ‘Keg Deposit Not Refunded’ item.
Tap ‘…’ and select the ‘Deposit’ tender.
Deposit liabilities will be reduced by $25 and sales revenue will increase by $25. No money is collected at this point since you already received payment when the keg was originally purchased.
Partial Deposit
Scenario 1
In this example, prepayment is required for a cake. A customer orders a $5,000 wedding cake and a $1,000 refundable down payment is required before making the cake. The deposit is redeemable at the time of final payment when the customer returns on the pick-up date.
Enable the 'Deposit' liability and create a liability item called 'Cake Deposit'.
If you receive an error while getting updates, visit our troubleshooting guide for help.
Ring up a sale for the 'Cake Deposit' item in the amount of $1,000.
There should only be one item on the transaction.
Select a tender to accept payment for the sale.
At this point, deposit liabilities increase by $1,000.
When the customer picks up the cake, follow below to apply the down payment and collect the balance.
Ring up a sale for the $5,000 ‘Wedding Cake’ item.
Since the customer already paid a $1,000 deposit, tender the sale as a Split Tender transaction.
Using Split Tender, tender $1,000 to ‘Deposit’ and the remaining $4,000 to the customer’s preferred payment method.
Deposit liabilities will be reduced by $1,000 and sales revenue will increase by $5,000.
Scenario 2
Continuing the previous scenario, your business policy states that cakes canceled with less than 48 hours notice receive 50% of the deposit back. Here, the customer cancels the order a day in advance.
In addition to the items created in scenario 1, we’ll also create an item called ‘Cake Deposit Non-Refundable’. This item will be used instead to convert 50% of the money received from the ‘Cake Deposit’ liability item into sales revenue so we can refund the other half.
Set the price to fixed or open-priced as necessary.
This is not a liability item, so do not select a liability tender.
Complete a sale for the 'Cake Deposit' item as shown above in scenario 1.
When the customer cancels their order, follow below to convert the non-refundable portion of their deposit into sale revenue.
Ring up a sale for the ‘Cake Deposit Non-Refundable’ item in the amount that will not be refunded to the customer (in this case, $500).
Tap ‘…’ and select the ‘Deposit’ tender.
Deposit liabilities will be reduced by $500 and sales revenue will increase by $500. No money is collected at this point since you already received payment when the deposit was originally given.
Follow below to refund the remaining 50% of the deposit back to the customer.
