C-Suite POV: Increasing Profitability With the Right ToolsBy: Mark Bell | February 25th, 2021
As a C-suite executive, you work every year to create a line item for chargebacks in your annual budget. Then you pay those fees which are dished out by your retail trading partners (up to 2% of your top line revenue).
Rinse and repeat. Every. Single. Year.
It’s time to challenge the status quo! Just because it’s something you’ve always done, doesn’t mean it has to be that way forever. In case you haven’t heard, there’s another “new normal” taking shape and it revolves around creating a proactive process to remedy flaws in your transaction processes, fix the root causes of late or inaccurate shipments, and build stronger relationships with your trading partners through effective communication.
In other words, you don’t have to accept chargebacks. You can fight back!
Let’s say your annual revenue is $15M. You’re likely paying up to $300K per year in fines, fees, and chargebacks. That’s over a quarter of a million dollars that you’re throwing down the drain each year because you do not have the right tools in place to keep on top of them. Isn’t it time to change this?
Don’t be resigned to the fact that chargebacks are inevitable–they are not. Here are some simple steps you can take to start reducing the amount of chargebacks you see every year and create a more efficient supply chain that works for you and your business:
Communicate with your trading partners–often!
It’s important to keep a constant line of communication open with both your partners and internal teams. You should invite your top partners to work with you to address the causes for any transaction discrepancies and make sure you’re conveying all of your issues thoroughly. An easy way to work hand-in-hand with your partner is to make them aware of your document processing schedule. This enables them to work with you to documents processed as quickly as possible, allowing purchase order acknowledgments and advance ship notices to be sent out in a timely fashion.
Empower your internal teams
Internally, ensure you’re documenting shipments in a detailed way and leaving a paper trail of comments on each document throughout the order process. You should also designate appropriate team members (get everyone involved) to take ownership and be responsible for specific action items. Having documentation on hand will help you dispute chargebacks with your trading partner if you determine one was sent in error.
Leverage the right technology
Investing in a technology platform is a key step in your fight against chargebacks. First, if you have the right tool you’ll be able to achieve visibility into your supply chain, monitor shipments, and prevent price discrepancies. It will also allow you to be proactive and see exactly where the issues are coming from and work towards solving them. Leveraging technology will also help you get everyone in your organization on the same page and create a more data-driven culture around your supply chain.
Like what you just read, but not sure where to begin? Check out our FREE eBook on “The Top 5 Actions to Take to Reduce Chargebacks in Your Vendor Compliance Program.”
Ready to dive right in? Contact us today to learn how we can help you reduce chargebacks, take back your revenue, and improve profits.
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