Let's talk about retail deductions and chargebacks—they can be a real headache, right? If you're managing a big brand, those little deductions can stack up fast, cutting into profits before you know it. It's exciting to grow your brand, and the quality of your retail partnerships is critical. However, mishandling deductions can hurt your margins and your relationships with retailers. So, let's walk through the five most common mistakes companies make with deductions and see how a team like HRG can help you avoid them, providing a
sense of relief and reassurance.
Waiting Until It's Too Late
Many brands put off looking at deductions until the end of the quarter, or worse, year-end. What started as a minor issue can become a huge problem by then. It's like ignoring a small leak until you're ankle-deep in water. Staying on top of deduction patterns can catch these issues early, saving time and money and giving you a sense of control and empowerment.
How to Avoid It: Regular, real-time monitoring is key. HRG's post-audit recovery tools can track these deductions before they balloon into costly errors. You'll get an early heads-up, letting you take action immediately.
Misclassifying Deductions
Have you ever been confused by all the reasons retailers give for deductions? It might be a shipping error, a promo fee, or something compliance-related. Sometimes, retailers misclassify these deductions, which makes it even more challenging to address the real problem. Misclassifications can lead to disputes and lost revenue, which you definitely want to avoid.
How to Avoid It: Let's get clear about your deduction codes. HRG has an expert team that understands the smallest accounting details and can help ensure every deduction is categorized correctly. This level of accuracy can prevent future headaches, boosting your chances of recovering lost revenue.
Accepting Deductions Without Question
It's common for companies to accept deductions as a cost of doing business. But here's the truth: retailers make mistakes, too, and sometimes deductions are invalid. When you don't have a system to challenge them, these slip-ups go unchecked, which means you're likely losing money that could be recovered.
How to Avoid It: Set up a system for disputing deductions, especially the questionable ones. HRG's team is ready to handle disputes, review invalid deductions, and recover what's rightfully yours. They handle the back-and-forth communications with retailers, saving time and ensuring every dollar counts, giving you a sense of security and confidence.
Ignoring the Bigger Issues
Have you handled deductions but never looked at their root causes? Many brands need help with recurring issues because they are unable to solve the underlying problems. You're setting yourself up for long-term losses by not addressing these repeat deductions.
How to Avoid It: The solution is digging deep with a root cause analysis whenever you find a pattern in your deductions. HRG goes beyond quick fixes—they help identify long-term solutions, so you're not constantly dealing with the same errors. Their support can lead to real operational improvements that protect your profits over the long haul.
Letting Departments Work in Silos
Deduction management is more than just the job of one department. Finance, sales, supply chain, and even legal must be in sync. But all too often, these teams operate in isolation. This lack of communication can mean missed opportunities for recovery and more deductions slipping through the cracks.
How to Avoid It: The solution is teamwork. HRG acts as an extension of your team, bringing everyone together to work toward common goals—keeping deductions under control and maximizing recovery.
Conclusion: Turn Retail Deductions into a Strategic Advantage
Retail deductions are a common reality for suppliers, but they don't have to be a drain on profits. By avoiding these common pitfalls and partnering with experts like HRG, you can turn deduction management into a strength instead of a weakness. Partner with HRG and their team's deep expertise, and you'll recover lost revenue, strengthen retailer relationships, and improve your internal processes.
How to Avoid It: Ready to Stop Losing Money to Retail Deductions? Contact HRG today and let our experts help you resolve retail deductions before they become costly errors. Our proven solutions will put you back in control of your profitability.
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The Savvy Supplier: Finally, a Podcast for all Retail Suppliers! Our goal is very practical: We will save you Time & Money. Boyd Evert will give you actionable expert advice to make Wiser Decisions and get Fewer Deductions.
Hosted by the experts who created deduction recovery – and perfected it.