Chargebacks – The Supply Chain Version of Battleship

Billions of dollars of waste and inefficiency are created annually from the inability to comply with retailer guidelines for carrier routing, shipment labeling, product packaging, item ticketing and EDI transmissions.  With significant margin pressure on both retailers and manufacturers due to the recession you may be wondering why the industry has not been able to significantly reduce these “preventable deductions.”   The answer is that enforcing compliance is a like a complex game of Battleship for suppliers, which requires them to keep pace with an average 50-150 business rules for each of their 75 to 100 retail customers.  Retailers do track compliance towards similar types of performance criteria such as on-time delivery, accurate documentation and carrier routing.  However, there is very little consistency between retailers on the actual metrics being tracked.  Continue reading