WALMART CHARGEBACKS
WHAT IS A CHARGEBACK ?
A chargeback is a fee charged by Walmart to a supplier for breaking terms of their contract or failing to meet an area of compliance. The point of chargebacks is to encourage suppliers to improve their supply chain and compliance. They also help Walmart get the right product in the right condition at the right time so they can charge the lowest price. Chargebacks can contribute to a large amount for some suppliers and can significantly reduce profits. Thus, it is crucial to have a good understanding of how to identify chargebacks and how to avoid them.
HOW DO I AVOID CHARGEBACKS ?
The first step in avoiding chargebacks is to know the compliance standards. Then suppliers should have a good understanding of what is causing most of the fines. Suppliers should identify solutions, communicate with Walmart where necessary, and implement those solutions. In some cases, chargebacks can be challenged to Walmart if a supplier feels that errors were caused by Walmart’s system or that the issue will bring unintended secondary effects to the supplier. Proper evidence will need to be presented in this scenario. Other times Walmart will proactively waive fines if it was due to system error, extreme weather, or an uncontrollable situation.
WHAT ARE COMMON FORMS OF CHARGEBACKS AT WALMART ?
The most common forms of chargebacks suppliers will see from Walmart are related to On-Time In-Full (OTIF) or Packaging and Labeling (also known as SQEP). To determine the causes of chargebacks, both the OTIF and SQEP dashboards within Retail Link can be utilized. These dashboards will highlight the reasons for failing to meet compliance as well as the associated fine. For OTIF, all items on the PO must be filled completely. Chargebacks will occur if an item is underfilled or overfilled. Then the PO needs to be delivered on time. All OTIF charges are calculated monthly but are billed quarterly. SQEP has a similar dashboard that shows different defect categories and sub-defects. This will allow suppliers to drill down to the specific defect that is causing a compliance issue. Like OTIF, SQEP is evaluated on a monthly basis. The FixIT application can also be used to see specific examples of defects and to communicate to the Walmart warehouse team any resolutions that are in effect. Outside of OTIF and SQEP, there are other general chargebacks that can occur. Suppliers can use the list of chargeback and deductions codes to determine why they are being fined.
THERE ARE 3 MAIN TYPES OF CHARGES THAT WALMART SUPPLIERS MAY ENCOUNTER:
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Accounts Payable
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Accounts Receivable
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Post Audit
ACCOUNT PAYABLE CHARGES
To dispute Accounts Payable charges, suppliers must use the Accounts Payable Disputes Portal (APDP) within Retail Link. These charges originate from invoices submitted by the supplier and paid by Walmart.
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Suppliers can dispute charges using either a claim number or an invoice number:​
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For most deductions, such as short-ship issues, claim numbers can be used.
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If no claim number is available, the invoice number should be used instead.
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Supporting documentation—such as Proof of Delivery (PODs) and/or freight bills of lading—must be attached when submitting a dispute.
To dispute Accounts Receivable charges, suppliers need to access the High Radius portal. These charges are typically assessed by Walmart to the supplier and include items such as:
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On-Time In-Full (OTIF) penalties
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Excessive Defective Invoices, and more.
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To get set up in High Radius, suppliers must email the portal team with their vendor number and request access.
POST AUDIT CHARGES
Post Audit charges occur when Walmart reviews historical invoices. Walmart often partners with third-party auditors to conduct these reviews.
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Examples of post audit charge reasons include:
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Payment discrepancies due to Rollbacks
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Incorrect freight terms
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Allowance disputes (e.g., swell allowance)
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Walmart cannot bring post audit claims more than two years after the audited calendar year.
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To dispute a post audit charge, suppliers must work directly with their merchant team. If an agreement is reached, the merchant will coordinate with the auditor to explain and process the resolution. However, it is always our recommendation to ask for additional information from these Post Audits to ensure the accuracy.
HOW DOES OCM SUPPORT SUPPLIERS WITH CHARGES ?
At OCM, we proactively review chargebacks and deductions monthly to ensure suppliers are not being wrongly charged. Our primary goal is to work with your team to validate the accuracy of each deduction and identify opportunities for recovery.
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We act as a strategic partner and audit resources, guiding suppliers through the dispute process. Whether it's navigating Retail Link tools, preparing supporting documentation, or working with your accounting team, we’re here to help you recover every dollar you’re entitled to.