A sell-in rebate rewards the distributor for buying; a sell-through rebate rewards it for selling. The basis is the partner’s report of resale to end customers — by product, by customer, by period — and the rate can be flat, tiered, or set by end-customer segment.
Suppliers prefer it because it pays for demand rather than for stock building, and it does not reward a partner for loading inventory ahead of a period end. The cost is that the whole program rests on the sell-through report: lines that do not match the supplier’s products or customers earn nothing, lines reported twice earn twice, and lines reported late land in the wrong period. The quality of that matching decides what the partner is actually paid.