Support » Plugin: TeraWallet - For WooCommerce » Apply Credit as Discount

  • Resolved joshuanan

    (@joshuanan)


    There should definitely be an option to change how credits are applied. At the moment credits are applied as a payment. This means they are applied after WooCommerce’s free shipping is calculated, and after sales tax is calculated. I realize that applying credits like a regular payment is necessary when allowing topups, but not everyone wants to treat credits like real money and allow topups. For one thing, treating credits like real money (as opposed to it being part of a discount program) puts a huge burden on a company to protect that money. Suddenly, stores have legal obligations comparable to banks!

    On the other hand, running credit-back programs is a great way to promote your products and increase store sales. (Also, you can manually give customers credits to discount their order, which is a great way to utilize this plugin.) There’s a problem though, and it’s that credits are always treated as a real payment method (i.e., as real currency).

    <h3>Problem 1: Sales Tax</h3>
    Let’s say I give a customer 5% credit back on all their store purchases. If my store also charges them sales tax, the following scenario would occur.

    Customer pays $100 for product, $10 for shipping, and $10 for sales tax. Customer earns $5 for the purchase, off of the product price. Later customer purchases a $3 item and uses the credit. Now the customer is charged $0.30 for sales tax. That means the customer is being charged sales tax just to use their credit! Since we want the credit to apply as a discount, no sales tax should be charged. Technically, the product should be considered free for tax purposes after a 100% discount is applied.

    <h3>Problem 2: Free Shipping</h3>
    Let’s say we want to give customers free shipping in WooCommerce when they purchase $50 or more in a single order. In this case, the following scenario can occur.

    A customer wants a $10 discount on a $55 item. In order to give them this discount, we offer to give them $10 of credit to put toward this $55 purchase. However, the problem is that now the customer is paying $45 for a product, but still getting free shipping! This is because free shipping is calculated before any payments are applied, but after coupons are applied. So free shipping is being awarded because the price of the product is $55, and then the $10 credit is being applied as a form of payment.

    <h3>Solution: Option to Apply Credits Immediately After Coupons</h3>
    There needs to be an option to apply credits immediately after coupons are applied. This would be before free shipping and sales tax are calculated, and would allow us to use TeraWallet credits like regular discounts (not as real currency, with real-world value).

    As an example of how companies should be doing discounts, check out Exxon Mobile’s Rewards “Program Terms and conditions”. They have the right to limit how and when reward points are awarded, and even the value of award points (see section 3). Why? Because reward points aren’t owned by the customer, because they have no cash value (see section 5).

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  • Thread Starter joshuanan

    (@joshuanan)

    The above in a nutshell:

    1. Terawallet treats credits as a form of payment.
    2. Not everyone wants to use credits as a form of payment. Some people want to use it as part of a discount program.
    3. Treating credits as a form of payment messes up the implementation of free shipping and sales tax when credits are really being used as a discount.
    4. There needs to be an option to apply credits immediately after coupons are applied, before free shipping and sales tax are calculated.
    Plugin Author Subrata Mal

    (@subratamal)

    @joshuanan Sorry for the delay in response. Please reach out to us at our support email support@woowallet.in regarding this.

    Thanks

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