Did you know that not all Target deductions are valid? If you get a code A030 for a carton shortage, but you shipped all of the ordered product, you can submit a case and recover that lost revenue. Follow these steps to get back the money you’re owed.

What Chargebacks and Deductions Do Target Suppliers See?

All Target chargebacks are accounts payable (AP) deductions from a shipment’s payment. Target refers to these as violations, and they appear on your shipment payment. Deductions occur when you fail to comply with Target’s On Time Fill Rate (OTFR) policy.

Target will issue a chargeback after the two-week violation lifecycle. This period allows you to file for an exemption for invalid deductions before they become full chargebacks. Violations come as a chargeback of 5% of your cost of goods sold (COGS) for non-compliant items.

If you’re lucky, Target’s SPM team will file an exception before the chargeback occurs. You may still see this on your payment, but it simply means Target recognized that it made a mistake and will not charge you.

There are over 250 deduction reason codes (compared to Walmart’s measly 100+ deduction codes), but the most common are returns or shipping compliance-related. Here is a breakdown of these codes:

Common Target Deduction Reason Codes

• A004 (Returns): Target has returns that comply with your Return Policy agreement.
• A030 (Short Ship): Target claims you shipped fewer cartons than ordered.
• A032 (Returns): Target claims you shipped damaged or spoiled product.
• A034 (Short Ship): Target claims you shipped fewer case packs or units than ordered.
• A035 (Overship): Target claims you shipped more cartons, case packs, or units than ordered. You’ll see this deduction if you get too many returns at your Target DC.
• A036 (Pricing Variance): Target claims you charged more than received due to pricing changes. You’ll see this deduction in the amount Target thinks it’s owed.
• A038 (Substitution): Target claims you substituted product on the receipt.
• A135 (Returns): The Target DC returned damaged product. You may see this code if the product was damaged during shipping or handling at the warehouse or DC.
• A147 (Short Ship): Target claims you shipped product Target did not order.

Shipping-related codes will appear as Invoice Match Deductions in Synergy. You can see the reason code on the document provided by Target. Return-related chargebacks will appear as Return-damage-defective Deductions on the deduction document but won’t show a reason code.

You can find all deduction documentation in Target’s supplier portal, Partners Online (POL). Deductions are listed under Accounts Payable: Domestic on the Payment Information page. Click the Payment Number to see the chargeback.

Invalid Deductions—How to Get Your Money Back

If you receive a chargeback after the two-week violation lifecycle and can prove it was invalid, you can get a chargeback reversal. Target will reimburse you for the amount of the invalid deduction.

Prepaid suppliers can dispute deductions up to 18 months after the initial chargeback, while Collect suppliers only have 9 months from the ship date. Target has a 30-day service level agreement (SLA) in its AP department for invalid deductions after you create the dispute before it closes the case.

Important: You can only submit one case per chargeback. If your invoice has multiple different chargebacks (e.g., short shipped and damaged), you must submit a case for each one.

Let’s dive into how to recoup that lost revenue.

Disputing a Deduction in Synergy

First, gather your documentation:

• Invoice copy
• Packing slips
• Bills of lading (BOL)
• Credit/Debit memo (EDI 812)
• Signed proofs of delivery (POD)
• Signed proofs of shipment (POS)
• Emails from your merchant approving price changes or returns
• Other documents showing that the deduction was invalid, such as EDI 945s

Next, follow these directions to create a dispute case in Synergy on POL:

1. Log into POL and click Synergy and Case.
2. Click Create New Case and Dispute.
   
   1. If you want more information on your chargeback, click Request for Copy/Info. Note that these requests follow the same 30-day SLA, so receiving this information may take up to a month.
3. Under Document, type the Document ID from the chargeback. You can find this in the deduction documentation under Document #. Depending on the chargeback type, it will start with either CB or VC.
   
   1. Typically, simply entering the Document # will automatically populate the deduction details, such as location and department.
4. Select Deduction from the Deduction/Invoice Type dropdown.
5. Type why you are disputing the deduction and the reason code (e.g., “A030 – All cartons received per POD”).
6. Add any additional information in the Brief explanation for raising the case textbox.
   
   1. This field lets you clearly state your case and give context to the dispute.
7. Review the document information:
   
   1. Document amount
   2. Department
   3. Purchase order number (PO #)
   4. Location
   5. Receipts
   6. If anything is missing, add it manually.
8. Click Next.
9. Upload your supporting documentation. The following file types are supported:
   
   1. Images: PNG, JPG, GIF, TIFF
   2. PDFs
   3. CSVs
   4. EML files (emails)
   5. Word DOC/DOCX
   6. Excel XLS/XLSX
   7. PowerPoint PPT/PPTX
10. Review everything for accuracy and click Submit.

You have now created a dispute case. Follow these steps again to dispute more.

Tracking Cases in Synergy

Go to Cases in Synergy to track the progress of your disputes. The following are the different statuses you will see:

• New: Target has received your case, but no one has opened it yet.
• In Progress: Target is actively reviewing your case. Your case may spend up to 30 days in progress.
• Re-Opened: If the case manager incorrectly closed your case, they will re-open it. This status is very uncommon. Typically, Target will close the case and have you make a new one.
• Awaiting Info: The case manager will set this status if your dispute requires extra or updated information, such as documentation or context. Again, this status is very uncommon, and you should make a new case if Target closes it without approval due to missing information.
  • Note: Target tends to close cases to meet its SLAs and wait for the supplier to create a new one.
• Resolved: Success! Target has approved your dispute!
• Closed: The case is closed. This is the last step in a case’s lifecycle. It occurs after the dispute is approved (Resolved) or denied (not Resolved).
  • Note: Not all Closed cases are Resolved If Target denies the dispute or (sometimes) requires more information, the case manager will close the case.
  • Once your case is closed, it will show the amount approved—which may not be the total disputed. Open a new case to dispute more.
  • If the amount approved is $0, Target denied your dispute. Open a new case to try again, making sure to add more information and documentation.

Remember that it may take Target a full 30 days to close or resolve your case, although you may see a resolution in as little as 25 days.

What to Do Next

Prevention is the best medicine, so optimize your supply chain to avoid costly chargebacks. Target chargebacks can accrue fast, and losing 5% of your COGS can not only impact your bottom line but also damage your relationship with your retailer. Keep track of your documentation and create a clear line of communication with your logistics companies.

Of course, disputing deductions is time-consuming and prone to error, so let us help you recover invalid deductions. We provide automated tools to do the heavy lifting and then add an expert’s touch to ensure you get back every penny you’re owed. The best part? There are no monthly fees or hidden charges. We get paid when you get paid.

Interested in learning more? Use our revenue recovery calculator to see how much you can get back from Target, talk to an expert, or get your free opportunity report today!