Tired of Chargebacks? EDI by Design can help you find ways to reduce chargebacks without spending a lot of time and energy doing it.

Being hit with chargebacks is often just a matter of doing business for some suppliers, for some retailers too. As a supplier, one of the hardest parts about getting your EDI system up and running is complying with each retailer’s guidelines.

What are chargebacks?

Chargebacks are financial penalties for non-compliance with your trading partner’s requirements. Trading partners issue chargebacks because of vendor non-compliance with agreed-upon elements of the Service Level Agreement (SLA)

Why do chargebacks happen?

Chargebacks can be for something as simple as a carton not being marked correctly, not being packed according to retailer specs, being late in shipping, or not sending the EDI transactions that were required.

Depending on the retailer, the chargeback could be a certain amount per box, shipment, order, or even a flat rate. This means the retailer is making a deduction in their next payment to their supplier.

How can you reduce Chargebacks?

While there are several reasons for retailers to hit vendors with chargebacks, the one where EDI by Design can help the most is in the fulfillment process with clean and consistent EDI data. With the way our network operates, and the way suppliers and retailers can automatically transfer information to each other, we can help reduce the number and amounts of chargebacks being levied.

Types of chargebacks

The EDI 856 ASN (Advanced Shipping Notice) is one kind of EDI document transaction that most people are familiar with. Its primary purpose is to provide tracking and packing information ahead of time. Some of the most common elements included in ASN are PO number, ship notice number & location.  The ASN is the riskiest transaction for chargebacks, by far.

Beyond errors associated with improper ANSI standards, some other common reasons that B2B customers might execute an EDI chargeback to a vendor are:

1.    Using the wrong carrier

2.    Shipments arrive too early or late

3.    Key specs are missed (failure to meet proper packaging specifications, for example)

4.    Orders aren’t filled at the appropriate rate

5.    Something’s delivered to the wrong location

6.    Incomplete or incorrect paperwork  

How to become EDI compliant

Poor or outdated integration technology is often a cause of these types of chargebacks. 

Fortunately, there’s a better way to ensure EDI compliance so that EDI chargebacks happen less frequently and SLAs can be better met.

Here are 3 ways to reduce chargebacks using a Cloud Integration platform as your EDI provider:

1.    By using a cloud-based EDI system, you can design, build, operate and optimize critical ecosystem integration processes. Your solution will be flexible enough to grow as your business needs dictate.

2.    Such a platform brings end-to-end integration visibility across API, EDI, and non-EDI integrations.

3.    With a true Ecosystem Integration platform, businesses have the choice of self-service, managed services, or a blended approach – ensuring complete flexibility and control over their B2B integration strategy.

EDI by Design developed an innovative platform that would allow your customers to quickly and easily meet the requirements of all their trading partners in order to become EDI compliant. EDI by Design saves you time, effort, and money that would otherwise be spent manually on your EDI compliance efforts. The solution can effectively optimize your process and ensure drop, late, or inaccurate orders are a thing of the past.

If you're ready to simplify your work with end-to-end integration, start by browsing our EDI demo library.