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Top 3 Deduction Recovery Myths—And the Truth Behind Them

The HRG Team

Three reasons.

If you’ve been in the retail game for any time, you’ve probably faced the dreaded deductions—those mysterious charges that chip away at your bottom line. It’s frustrating. You work hard to get your products into retailers, only to find a portion of your revenue tied up in disputes over shortages, freight costs, or promotional allowances. To make matters worse, there’s a lot of misinformation about whether pursuing deduction recovery is even worth it.


Let’s cut through the noise. Below, we tackle three of the most common myths about deduction recovery and set the record straight.


Myth 1: Recovering deductions isn’t worth the effort.

Truth: Ignoring deductions is like leaving money on the table—sometimes a lot of it.

Imagine this: You’re a mid-sized supplier, and over the past year, you’ve written off $50,000 in deductions. It might not seem catastrophic in the grand scheme of things, but think about what that money could mean for your business. Upgraded packaging? More trade show appearances? Investing in your team?


Many suppliers assume the recovery process is too time-consuming or complicated. While it’s true that some deductions are valid, studies show that 60-80% of deductions are either incorrect or preventable. A good recovery service can sort through the paperwork, dispute the invalid claims, and return those funds to your bottom line.


Here’s the kicker: Even recovering a fraction of your deductions could boost your cash flow. In today’s competitive retail landscape, that’s a game-changer.


Myth 2: Only large suppliers benefit from deduction recovery services.

Truth: Suppliers of all sizes can benefit—sometimes smaller ones even more.

There’s a perception that deduction recovery is only practical for large CPG brands with deep pockets and complex supply chains. But here’s the reality: small and medium-sized suppliers are often hit hardest by deductions. If you’re operating on tighter margins, every dollar counts.


For example, your company brings in $1 million annually, and deductions account for 5% of that revenue. That’s $50,000 gone—money you could reinvest to grow your brand. Recovery services are designed to handle these issues efficiently, so you don’t have to build an in-house team or divert resources from other priorities.


Pro tip: Many deduction recovery providers work on a contingency basis, meaning they only get paid if they recover funds for you. That makes it a no-brainer for businesses of all sizes to explore their options.


Myth 3: Retailers will penalize you for disputing deductions.

Truth: Retailers expect suppliers to challenge invalid deductions.

Here’s the thing: Retailers deal with deductions day in and day out. They understand that disputes are part of the process, especially when the numbers don’t add up. The key is how you approach the situation. Disputing deductions professionally and with the right documentation can strengthen your retailer relationships by demonstrating your commitment to accurate, fair transactions.


Retailers value suppliers who take their businesses seriously. If anything, letting deductions slide signals that you’re not paying close attention. Plus, recovery services often act as intermediaries, handling disputes diplomatically to maintain a positive rapport with your retail partners.


Don’t Let Myths Hold You Back

Deduction recovery isn’t just for big players or those with endless resources. It’s for any supplier tired of losing revenue to errors or unnecessary charges. Think of it as reclaiming what’s rightfully yours—to improve your bottom line and reinvest in the things that help your business thrive.


Want to see if deduction recovery could work for you? Start by taking a closer look at your deduction history. It might surprise you how much is recoverable. And if you’re feeling overwhelmed, there’s help available from experts who specialize in navigating this tricky terrain.

Because every dollar matters. Why let it slip away?


Limited Time Offer for Walmart Suppliers. Cut Your Shortage Recovery Costs by 50%.





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