Code 58: DSDC Allowance (Other allowances DA, EB, SD)

2020-07-27
4 min read

Walmart uses deduction code 58 for two different reasons. The most common scenario by far is "Shortage Recovery Rate," but we also see code 58s given occasionally for a reason of "Other Allowances." Both reasons are described below.

What is Deduction Code 58 - SRR?

Code 58 - Shortage Recovery Rate

Code 58s for Shortage Recovery Rate are fines from Walmart taken as a deduction to payment made on all DSDC POs for a given 9 digit vendor number. The SRR for every supplier shipping DSDC will be adjusted based on the last 13 week's DSDC audit data. Audits are performed on a regular basis at RDCs and the data is used to calculate the rate that will be used when charging SRR fines.

The calculation for a supplier's shortage recovery rate is:

  • SRR = Average audited dollars short / Average expected dollars

This rate is then applied as a deduction against the total cost for each payment for each DSDC order. These can add up quickly!

Learn more about Walmart's SRR program here.

How to Prevent Valid Code 58s

  • Because SRR deductions are levied based on Walmart's calculations for accuracy of historical DSDC shipments, the only way to prevent these deductions is to make sure your shipping processes are completely buttoned up for your DSDC shipments.

  • This means that your ASN data must always exactly match what you ship.

  • You can review your audit data in the Advanced Ship Notice Dashboard app in Retail Link

Can Code 58s be Disputed?

Walmart's Accounts Payable Dispute Portal (APDP) allows disputes for code 58s. While the win percentage of these disputes in the older Direct Commerce portal was fairly high, it's yet to be seen how successful they will be in the new APDP app.

How to Dispute Invalid Code 58s

You can attempt a dispute in the Accounts Payable Dispute Portal (APDP). If that fails then send documentation to your buyer to request payback.

  • Supporting Documentation:

    • ASN data showing what was shipped vs. what was received (available in Advanced Shipping Notice Dashboard)

What is Deduction Code 58 - Other Allowances/DSDC?

Code 58 - Other Allowances/DSDC

Code 58s for Other Allowances/DSDC allowances are to cover a margin of error within ASN Packs on DSDC Shipments (Type 73 Purchase Orders). A code 58 occurs when this allowance is listed on the supplier agreement but not included on an invoice.

How to Prevent Valid Code 58s

  • Code 58s would only be triggered when there is an allowance listed on your PO and it is not listed on the invoice. Because these are only triggered when an allowance is given on your PO, Walmart tends to be difficult about disputing them except for a specific scenario. You should review your allowances before shipping your PO.

  • Check with your EDI provider to make sure applicable allowances are being included on invoices.

Can Code 58s be Disputed?

Yes, Code 58s for DSDC allowances can be disputed through the Accounts Payable Dispute Portal if you can prove that the allowance was actually given on the invoice.  Otherwise, you will need to reach out to your buyer for assistance with a payback. While APDP technically allows disputes for code 58s, they can be difficult to win.

The common scenario for invalid code 58s for DSDC allowances is that your Supplier Agreement states that an allowance is supposed to be given off-invoice, but your EDI provider is actually giving the allowance off-line-item. In this scenario, the correct dollar amount is being withheld from the invoice, just from the wrong place. Disputing and showing that the correct amount was already withheld can often overturn the deduction.

How to Dispute Invalid Code 58s

You can attempt a dispute in the Accounts Payable Dispute Portal (APDP). If that fails then send documentation to your buyer to request payback.

***Note
**Allowances are negotiated terms included in the supplier agreement or purchase order and will not be reviewed for repayment through the dispute portal. These deductions must be initiated with supporting documentation and approved by your buyer.

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The SupplyPike Team
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The SupplyPike Team

SupplyPike builds software to help retail suppliers fight deductions, meet compliance standards, and dig down to root cause issues in their supply chain.

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