How to Dispute Walmart OTIF Chargebacks

Learn about:

• The Difference Between Deductions and OTIF Chargebacks

• Which Chargebacks Are Disputable

• How to Dispute OTIF Fines

Walmart does not explicitly state that OTIF fines are disputable in their original documentation, however, through High Radius there is the ability to do so.

What's the Difference Between a Deduction Claim and an OTIF Chargeback?

Deduction Claims 

When suppliers do business with Walmart, they occasionally face financial adjustments known as "deductions." Deductions are specific amounts taken from the payment owed to the supplier due to various reasons like short shipping, allowance deductions, or other issues that deviate from Walmart's established terms. 

These deductions are typically processed through Walmart's accounts payable department. AP deductions mean that Walmart paid one of your invoices but withheld payment for all or part of the invoice because of something that occurred related to that particular invoice. Suppliers have the opportunity to dispute these deductions through APDP.

*For help fighting regular deductions, see our "How to Dispute Deductions" article. *

OTIF Fines

OTIF (On-Time In-Full) fines are chargeback fees imposed by Walmart to ensure suppliers meet delivery timeliness and completeness standards. These fines are managed separately from the regular invoicing process and are issued through the accounts receivable department at Walmart. 

If a supplier fails to meet the OTIF standards, Walmart issues a chargeback in the form of an invoice. This invoice details the fines due and is sent to the supplier through the accounts receivable department. Suppliers are expected to pay this invoice by the due date. If the invoice remains unpaid, Walmart will automatically deduct the amount from future payments owed to the supplier.

The Types of Disputable Chargebacks

The lack of documentation on OTIF disputes means that there are no clear standards as to what would warrant a fine, but there are some potential reasons for one:

• ASN Shipped Amount > Walmart OTIF App Received Amount

• DSS Received Amount > Walmart OTIF App Received 

• Receiving error on Walmart's end where they received an overage for an item on one PO and a shortage on another that offset each other

• There were factors outside of the supplier's control (COVID, weather, etc.).

Ideally, these issues would represent most failures for that month's OTIF period for that metric since the goal to avoid a fine is 90% for Prepaid On-Time, 98% for Collect Ready, and 95% for In-Full. 

How to Dispute an OTIF Chargeback

To create a "dispute," go to EIPP > Select either the OPEN (unpaid claims) or CLOSED BILLS (paid claims) tab.

1. Check the box next to the invoice(s) that need to be disputed.

2. Click the 'Dispute' button. This will open the 'Create Dispute' window.

3. Below the 'Dispute Reason' header in the blue field, click the dropdown menu and select the reason for the dispute. 

4. Click the blue field under the header to type in the amount this is being disputed. Enter amounts in the thousands without commas.

5. In the comments field, be detailed and give facts supporting the reason for the dispute. If there is an email that supports the claim, consider adding it to a Word document and attaching it.

6. Click the 'Upload' hyperlink to browse and select the necessary files. Confirm by selecting 'OK'.

• When troubleshooting attachment uploads for a dispute, keep these key points in mind:

  • The allowed file formats include .txt, .csv, .xls, .png, .jpeg, .jpg, .pdf, .xlsx, .doc, .docx, and .msg.

  • There are file size limitations; if necessary, divide documents into smaller parts.

  • Up to 10 files can be attached per dispute.

7. Select Save.

When a dispute over an OTIF fine is submitted, it is assigned a unique Deduction ID number and becomes visible under the Disputes tab. Initially, disputes are marked as 'New' and remain in this status until they are reviewed by a HighRadius expert. Upon review, a dispute will be either approved or rejected. Notification of the resolution is sent to the submitter's inbox on the day the claim is resolved.

Walmart offers a three-month grace period for new suppliers, during which OTIF fines are waived. This period allows new suppliers to familiarize themselves with Walmart's systems without the burden of financial penalties, although their performance continues to be tracked on the OTIF Scorecard.

Dispute OTIF Fines with SupplyPike

SupplyPike's Compliance solution is designed to help you meet your OTIF goal efficiently. SupplyPike aggregates data from seven different Walmart apps to automatically spot discrepancies and provide detailed OTIF scorecards for each carrier and warehouse provider.

Our platform also features Dispute Tracking to pinpoint the most significant OTIF opportunities across your supply chain, including carriers, ship points, items, and vendor numbers. 

Schedule a demo today to see if SupplyPike is the right fit for you!