Eliminate Charge-backs from Big Box Retailers
Charge-backs (often referred to as "expense-offsets") are financial penalties for non-compliance with your customer's requirements. Retailers issue charge-backs because vendor noncompliance disrupts operations and creates an additional expense for the retailer. Therefore, retailers create "expense offset policies" that are intended to recover the additional cost incurred by the retailer due to vendor noncompliance.
Unfortunately, EDI-related charge-backs have become profit-centers for a lot of retailers. Charge-back fees vary greatly from customer to customer. A $100 penalty for an EDI document containing errors would not be uncommon. Most of the retailers provide a charge-back fee schedule. Charge-backs are usually deducted off the check payment.
Some common challenges that organizations face with charge-back problems are:
- Frequency of change: Vendor manuals and routing guides change regularly and companies have issues keeping up with the changes.
- Complexity of the problem: Sometimes hundreds of charge-backs are issued and some of them are too small to investigate and are unclear. Also, every retailer's charge-back deduction schedule is different.
Reconciliation of charge-backs can be a difficult task as charge-backs may reflect shipments that were made several weeks ago. Therefore, it is important to have a good charge-back tracking and management process in place.
Attend a FREE on-line seminar to learn how to eliminate Charge-backs
James A. Parker has over 30 years experience in the design, development, marketing and sale of automated systems, primarily in the retail marketplace. Mr. Parker was the co-founder of Foretell Corporation; developer of the first Windows based EDI software products.
Mr. Parker was named by the Journal of Electronic Commerce as one of the 26 founders of the "then" $2 Billion Electronic Data Interchange industry in North America.
In partnership with Sears Logistics Services, Mr Parker formed, managed and led development of North America's largest EDI Service Bureau.
Mr. Parker is also a recipient of the "Provider Pros to Know" honor, which recognizes individuals from a software firm, service provider, consultancy, analyst, or research firm who have personally helped raise the profile of supply chain and have increased the recognition of the importance of the supply chain as a strategic function within the enterprise.
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