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Why Your Best-Selling SKU Is Also Your Biggest Deduction Risk

  • The HRG Team
  • Aug 13
  • 2 min read


Risk and reward balance.

It’s your pride and joy. Your top-performing item. The one SKU that’s in every planogram, driving 80% of your velocity and most of your marketing budget.


And unfortunately, it’s probably the one costing you the most in hidden deductions.


Let’s break this down.


More Volume = More Eyes = More Risk

The best-selling item in your lineup is often the one with the most movement through the supply chain. That means:

  • More shipments

  • More distribution centers

  • More eyes checking specs

  • More room for tiny errors to get magnified


When a lesser-known SKU ships with a slightly incorrect label? Maybe nobody notices.


But when your hero item does it—again and again—retailers flag it fast. They expect perfect performance from your top item. And they have an entire playbook of deduction codes ready when things go even slightly sideways.



A Fictional—but Familiar—Example

Imagine a snack brand with a best-selling protein bar sold in over 3,000 stores.


Their shipper changes vendors, and the new boxes arrive with a slightly darker barcode that sometimes won’t scan. That one change leads to:


  • $4,200 in unscannable item chargebacks

  • $6,800 in “unmatched PO” claims from retailers unable to verify delivery

  • $3,000 in OTIF (on time in full) deductions when stores mark the shipment short


Total loss in one quarter? Over $14,000 on their top item alone.


All because they didn’t realize small inconsistencies get punished disproportionately when volume is high.



The Irony of Success: Why Winners Get Penalized Hardest

Retailers prioritize auditing top sellers. Why? Because that's where their risk lives, too.


Your fast movers are often tied to:

  • Promotional calendars

  • Ad features

  • Endcaps or front-of-store placement

  • Planogram resets


That means any delay, error, or inconsistency affects their in-store execution and their revenue.

So when they deduct, it’s not personal. It’s protective.



How to Protect Your High-Volume SKUs from Becoming Deduction Magnets


At HRG, we recommend three essential strategies:

  • Monthly audit reviews on your top 5 SKUs to catch recurring deduction patterns.

  • Packaging verification protocols should be implemented whenever a spec, vendor, or production process changes.

  • Retailer-specific compliance training for your warehouse and logistics partners (because “close enough” doesn’t cut it anymore).


And of course, keep a human-led deduction recovery team watching the trends that automation can’t explain.


Don’t Let Your Star Player Be the Margin Killer

Your best sellers should be growing your business, not quietly draining it.


If you haven’t looked at your deduction rates by SKU, now’s the time. Because what looks like a minor hiccup in a high-volume item can snowball fast, and quietly erase your profit from all the growth you worked so hard for.


Take Action:

Let HRG analyze your top 5 SKUs for deduction exposure.We’ll show you what’s hiding behind the velocity. 👉 Schedule a free consultation



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