In this article, learn about:
Walmart’s deduction dispute timeframe
Common Walmart deduction codes
Some helpful tips for timely disputing
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Disputing Walmart deductions is not a simple process, and some suppliers have hundreds of thousands of dollars in deductions. Having a lot of disputes can be overwhelming, but creating a schedule, and knowing where to begin can help put the supplier in control of the deduction management process and getting money back.
Understanding Walmart Deductions
Walmart deductions are financial adjustments made to supplier invoices when issues arise during the supply chain process. These deductions can occur for various reasons, such as non-compliance with Walmart’s vendor requirements, promotional allowances, or shipping discrepancies. Understanding Walmart deductions is crucial for suppliers to maintain healthy profit margins and a positive relationship with Walmart. By familiarizing themselves with Walmart deduction codes, suppliers can efficiently track and manage these deductions, ensuring they address any issues promptly and accurately.
Walmart deductions can be categorized into several types, each with its own set of challenges:
Shortages and Damages: These deductions occur when merchandise is missing or damaged upon arrival at a Walmart store or distribution center
Chargebacks for Non-Compliance: Suppliers may face deductions for failing to comply with Walmart’s vendor requirements, such as incorrect labeling or packaging
Invoicing Errors and Discrepancies: Mistakes in invoicing, such as incorrect pricing or quantities, can lead to deductions
Returns and Chargebacks: Deductions for returned merchandise or chargebacks for various reasons, including defective merchandise
OTIF Charges: On Time In Full (OTIF) charges are deductions for failing to meet Walmart’s delivery benchmarks
Know Walmart’s Deduction Timeframe
Walmart only allows suppliers to dispute deductions that are less than two years old. Disputes of deductions that are two years or older may not be accepted, even if submitted. Working on the most recent deductions will ensure that they get resolved by Walmart’s deadline.
Ensuring that a fully executed supplier agreement is in place can help resolve disputes concerning payment discrepancies and confirm specific financial arrangements.
Older deductions may be harder to dispute because the paper trail can be lost. Many dispute claims require Bills of Lading (BOLs) and Proofs of Delivery (PODs). This requires checking in with the warehouse and logistics providers (e.g. 3PLs) on how long this documentation is kept. It is essential that all documentation is available in order to have a case for disputing the deduction in question. Having an organized system for accessing documentation allows a supplier to begin the dispute process faster. In turn, starting the process quicker means there is less likelihood of deductions aging out of Walmart’s timeframe.
Freight Bill Disputes
Freight bill disputes can arise when there are discrepancies in the freight bill, such as incorrect charges or missing information. Suppliers can address these discrepancies through Walmart’s Accounts Payable Dispute Portal (APDP). To dispute a freight bill, suppliers need to provide essential documentation, including the freight bill and proof of delivery.
Prioritize Which Walmart Deduction Codes to Dispute
There are nearly 100 Walmart deduction codes that cover a variety of reasons for invoices not being paid in full. There are a few prevalent deduction codes that are simpler to dispute, and there are others that are more difficult. For example, some deduction codes will only require key documentation (Purchase Order, Invoice, POD, etc.) in order to dispute.
Typically, the easiest deduction codes to dispute, and ones that are most likely to be approved, are related to shipping. Some of the most common invalid deduction codes from Walmart are:
Related Reading: Walmart Deduction Codes
Choosing which deductions to dispute also depends on the validity of the deduction. Deductions aren’t always the suppliers’ fault. Sometimes Walmart may issue a deduction that is valid, but other times it may be invalid. For invalid deductions, the focus should be on recovering lost revenue. For valid deductions, the focus should be on preventing future deductions of the same kind. Valid deductions may be disputable, but they are not worth disputing because those disputes are unlikely to be won.
Regardless of validity, Walmart rarely approves disputes for some codes, such as code 13 for example. While occasionally disputes for code 13 (or others that are also rarely approved) can be won, it is important to make sure that suppliers focus not only on winning disputes but also on improving processes to reduce recurring deductions.
Focusing on these deduction codes is beneficial because disputes are more likely to be approved for common codes.
Related Reading: Avoiding Common Walmart Deductions
Prioritize the Deduction Amount to Dispute
Some deductions can be as small as a few cents, while others can reach tens of thousands of dollars. Instances of duplicate payment, where an invoice has been paid more than once, should also be prioritized for corrective action to recover the overpayment. The smaller deductions are just as important as the larger ones. A few cents can add up over time, so it is essential to compare the numbers to see where the most revenue loss is occurring. However, it’s often most beneficial to start with the largest deductions and work down to the smaller ones.
Organize the Dispute Process
Setting aside an hour or two a day to work through prioritized deductions can be helpful. Eventually, as the list gets shorter, this can be reduced to a few hours a week and so on. However, at the beginning, when the list seems impossibly long, it may be necessary to outsource or delegate the work of disputing deductions.
There are a couple of ways suppliers can ensure deductions are processed in a timely manner:
Hire a consultant to work through older deductions, getting the list to a more manageable level
Hire a full-time position to solely handle deduction disputes
Delegate deduction disputes among the team
Disputing Deductions through the Accounts Payable Dispute Portal (APDP)
The Accounts Payable Dispute Portal (APDP) is a platform provided by Walmart for suppliers to dispute deductions. Suppliers can use the APDP to create a dispute by providing required details, such as the vendor code, claim code, and invoice number. Additionally, suppliers can attach backup documentation, such as invoices and proof of delivery, to support their dispute. The APDP platform allows suppliers to track the status of their disputes and communicate with Walmart representatives, ensuring a transparent and efficient resolution process.
Preventing Deductions
Preventing deductions requires a proactive approach and meticulous attention to detail. Suppliers can take several steps to prevent deductions, including:
Monitoring Walmart Deductions Regularly: Keeping a close eye on deductions to identify patterns and address issues promptly
Investigating the Reasons for Deductions: Understanding why deductions occur to prevent future occurrences
Addressing the Underlying Issues: Implementing corrective actions to resolve the root causes of deductions
Resolving Disputes Efficiently: Using the APDP and other tools to manage and resolve disputes quickly
By preventing deductions, suppliers can maintain healthy profit margins and a positive relationship with Walmart, ensuring a smoother supply chain management process.
Additional Deduction Help with SupplyPike
SupplyPike’s software helps suppliers dispute deductions as they arise. This allows suppliers to stay current without worrying about deductions getting old. SupplyPike removes the monetary threshold for disputes, helping suppliers dispute both simple deductions, such as Codes 22, 24, and 25, and difficult ones. With SupplyPike, suppliers can dispute deductions without having to go through Retail Link, saving valuable time and energy with auto disputes.
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