Imagine it’s December 29th. Your sales team is about to celebrate a successful year, with bonuses in sight. Then, out of nowhere, a massive $4 million deduction lands, blowing up the P&L. The party is over before it starts.
That nightmare became a reality for one supplier in the health and beauty category. This was no ordinary deduction—it was a tangle of system migrations, third-party invoicing, and fixture costs buried in confusion. Most suppliers would write off the kind of deduction as a lost cause. However, this supplier had an ace up their sleeve: HRG.
The Hidden Risks Suppliers Face
If you sell in the cosmetic aisle, you know fixtures are necessary. Unlike a soup display that can be stacked and restocked, cosmetics require specialized shelving and organizers. Over time, the cost of these fixtures shifted from retailers to suppliers. Add a third-party vendor to the mix, and suddenly, a supplier is being billed, deducted, and left in the dark.
This supplier's real trouble began when their Millions on the Line: How One Supplier Recovered $3M After a Year-End Deduction Nightmare
Imagine it’s December 29th. Your sales team is about to celebrate a successful year, with bonuses in sight. Then, out of nowhere, a massive $4 million deduction lands, blowing up the P&L. The party is over before it starts.
That nightmare became a reality for one supplier in the health and beauty category. This was no ordinary deduction—it was a tangle of system migrations, third-party invoicing, and fixture costs buried in confusion. Most suppliers would write off the kind of deduction as a lost cause. However, this supplier had an ace up their sleeve: HRG.
The Hidden Risks Suppliers Face
If you sell in the cosmetic aisle, you know fixtures are necessary. Unlike a soup display that can be stacked and restocked, cosmetics require specialized shelving and organizers. Over time, the cost of these fixtures shifted from retailers to suppliers. Add a third-party vendor to the mix, and suddenly, a supplier is being billed, deducted, and left in the dark.
This supplier's real trouble began when their Enterprise Resource Planning (ERP) system changed. They migrated from a legacy system to a third-party ERP—except the migration didn't go as planned. The new system duplicated thousands of invoices, removing descriptions and making it impossible to tell valid charges from erroneous ones. The result? A massive deduction right before year-end, with no clear path to dispute it.
The HRG Difference: Technology + Expertise
Recovering this money wasn’t going to be easy. The supplier’s internal team was at a loss. They had thousands of invoice line items, fixtures with different costs (some domestic, some imported), shipping charges bundled in other ways, and no clear visibility into what was real and what wasn’t.
Enter HRG.
Boyd Evert and his team knew this wasn’t a case for manual review—it required technology. Over six weeks, HRG engineered a custom algorithm to identify discrepancies. The algorithm didn’t just match amounts; it accounted for bundled fixtures, variable costs, and invoice inconsistencies. HRG’s experience with retailer systems, deduction processes, and dispute management meant they could reconstruct what went wrong—and prove what was invalid.
The Emotional Toll of Deductions
Deductions aren’t just about numbers; they impact people. When the supplier’s team saw the $4 million hit, they knew it meant: no bonuses. Worse, for some, it could mean job losses.
HRG has seen it before: deductions at year-end that turn celebrations into stress-fueled all-nighters. Suppliers often don’t realize the risk because these issues don’t happen every year, but when they do, the damage is swift and painful.
A $3 Million Victory
After weeks of forensic-level data work and strategic dispute management, HRG delivered results: $3 million was recovered. The reaction was silence at first, then disbelief, and then gratitude.
The supplier’s leadership sent emails up the chain, thanking HRG for saving their year.
For many suppliers, deductions feel like an unavoidable cost of doing business. But HRG proves that they don’t have to be.
Why Suppliers Need a “Wiser Advisor”
Retailers change their systems all the time. Policies shift, deductions evolve, and suppliers are often left scrambling. Without the right expertise, it’s nearly impossible to keep up.
HRG isn’t just about recovery; it provides visibility. Its clients don’t just get money back—they get ahead of problems before they escalate. When a retailer plans to roll out a new deduction strategy, HRG clients know in advance. When a supplier needs a stronger dispute argument, HRG crafts it in a way that retailers respect.
One supplier even had their buyer recommend HRG—not because they wanted fewer disputes but because they knew HRG would bring clarity, resolve the right issues, and foster a fair process for both sides.
Protect Your Bottom Line Before It’s Too Late
This case study isn’t unique. End-of-year deductions happen, and system changes create vulnerabilities. Without visibility, suppliers are left playing defense when they should be proactive.
HRG exists to change that. If you want to safeguard your margins, ensure fair disputes, and prevent another year-end nightmare, it’s time to connect with the experts.
Hear the whole story on the Savvy Supplier podcast.
Don’t wait until December 29th to realize you need help.
📞 Call HRG at 479-616-1600
📧 Email info@HRG-audit.com
🌐 Visit HRG-audit.com
Wiser decisions. Fewer deductions. Peace of mind.