Summary: This paper joint demand uncertainty and sales effort to systematically compare two rebate structures widely used in Taiwan retailing: sales-based rebate (SR) and margin-based rebate (MR). In particular, we supposed a company launches a new product and promotes it to a retailer (e.g. chain store). It is clear to find that SR’s stocking level is indeed higher than the MR’s stocking level. Besides, the MR leads to higher retail price and higher total channel profit. The result is based on a certain sales-effort demand function used in the paper. It is also very important to know that if the retailer continues its great efforts to promote especially in certain products, these sales will increase significantly.