1. Mastering Deduction Management with iNymbus

2. Table of Contents Introduction 3 Chapter 1 Understanding Deductions and Chargebacks 5 Chapter 2 Decoding Deduction Codes and Dispute Processes 9 Chapter 3 Key Challenges in Deduction Management 16 Chapter 4 Benefits of Automation in Deduction Management 20 Chapter 5 Introducing iNymbus: DeductionsXchange 24 Chapter 6 Measuring the Impact With Case Studies 28 Summary 32

3. Introduction In today's retail landscape, vendors and suppliers face challenges dealing with deductions from major retailers such as Amazon, Walmart, and Target. Handling deductions from multiple smaller retailers like Walgreens, Kroger, and Nordstrom adds further complexity. These deductions are complex and common, hurting vendor profits and making business operations harder. Even with more people and better coordination, managing deductions manually is slow and expensive. But there's a solution: technology. This ebook explains deductions in simple terms, covering the basics, different types, and how to dispute them. It also shows where to find deductions on the retailer’s portal, helping vendors understand and manage them better. Copyright © 2024 iNymbus.All rights reserved. 3

4. INTRODUCTION Most importantly, the ebook talks about how technology can help. By making things faster and more accurate, technology can revolutionize deduction management, making business smoother and more profitable for vendors and suppliers. Copyright © 2024 iNymbus.All rights reserved. 4

5. Chapter 1 Understanding Deductions and Chargebacks Before we get into other chapters, it's essential to understand the nature of deductions and chargebacks in the retail industry. What are Chargebacks and Deductions? Chargebacks and deductions are critical aspects of vendor transactions, often serving as mechanisms to enforce compliance and maintain financial integrity in business relationships. While deductions cover a range of financial adjustments, from small issues to major penalties. Chargebacks address specific problems like pricing, contract breaches, or invoice disputes. These processes promote transparency, accountability, and adherence to contracts within supplier networks, leading to smoother operations and more sustainable partnerships. Copyright © 2024 iNymbus.All rights reserved. 5

6. Deduction “ A deduction is a reduction in payment made by a retailer to a supplier for reasons such as pricing errors or damaged goods.“

7. UNDERSTANDING DEDUCTIONS AND CHARGEBACKS Common Types of Deductions Issued Types of Deductions Issued Shortages Pricing Claims Compliance Advance Shipment Notice Label Inaccuracy Purchase Order (PO) Violations 1. Shortages : Shortages occur when the vendor delivers fewer products than stated on the invoice. Below are a few common scenarios you should be aware of: Miscounts: This is the most common reason, arising from inaccurate inventory counting, product packing, or order shipping. Copyright © 2024 iNymbus.All rights reserved. 7

8. UNDERSTANDING DEDUCTIONS AND CHARGEBACKS Pilferage: Product theft from your inventory, whether at your warehouse or the fulfillment centers. Secure warehousing and shipping practices help prevent pilferage. Shipping Damage: This can happen when your products are handled roughly during shipping. Careful packaging and choosing reputable carriers can help prevent this. System Errors: Rare cases where the system incorrectly records shipped or received quantities. 2. Pricing Claims : Deductions related to disagreements over pricing, discounts, or promotional deals. Label vs Invoice Mismatch: When the product label price differs from the invoice price. Purchase Order vs Invoice Mismatch: When the purchase order price differs from the invoice price. Copyright © 2024 iNymbus.All rights reserved. 8

9. UNDERSTANDING DEDUCTIONS AND CHARGEBACKS 3. Compliance Chargebacks Deductions are issued when vendors fail to comply with the retail agreement terms. Common examples: Advance Shipment Notice (ASN) Issues: Incorrect ASN unit counts or documentation like invoices and Failing to notifyabout early/changed shipments. Purchase Order (PO) Violations : Not meeting specified PO quantities and missing PO confirmations or shipping windows. Label Inaccuracy: Product labels don't match the agreed specifications. Packaging Non-Compliance: Vendors failing to adhere to packaging requirements such as incorrect box sizes, inadequate padding, or using unauthorized packaging materials. Copyright © 2024 iNymbus.All rights reserved. 9

10. UNDERSTANDING DEDUCTIONS AND CHARGEBACKS Here’s a breakdown of Compliance Chargebacks : * based on iNymbus customer data Copyright © 2024 iNymbus.All rights reserved. 10

11. Chapter 2 Decoding Deduction Codes and Dispute Processes in Retail Retailer and Deduction Codes: In the retail sector, how deductions are issued varies among different retailers. Some, like Target, Walmart, and Kroger, use deduction codes instead of providing detailed explanations for deductions. Understanding these codes is crucial for retailers. They serve as the key to understanding why a deduction was made, allowing for a precise understanding of any discrepancies. When disputing deductions, familiarity with these codes is invaluable. They form the foundation of the dispute resolution process, enabling efficient navigation through the procedure. Knowing these codes also helps determine the necessary documentation and descriptions needed to effectively substantiate a dispute. Thus , investing time and effort to comprehend these deduction codes is essential for any supplier. Copyright © 2024 iNymbus.All rights reserved. 11

12. DECODING DEDUCTION CODES AND DISPUTE PROCESSES Below are some of the most commonly issued deductions by each retailer and their Deduction Codes: Code 21 Concealed Shortages Code 22 Merchandise Billed not Shipped Carton Shortage/Freight Bill Signed Short Code 24 Walmart Code 10 Price Difference as Documented Price Difference between PO & Invoice Code 11 view all walmart codes.. https://blog.inymbus.com/walmart-deduction-codes-explained-inymbus A030 Shortage A032 Damaged or Defective Product Target A034 Case Pack Issue A038 Item Substitution Code 2 Promo Allowance Difference Kroger Code 3 Cost Difference Code 4 Shortage/ Damage view all Kroger codes.. https://blog.inymbus.com/kroger-deductions-an-in-depth-guide-by-inymbus Finding Invoices With Deductions This varies for each retailer, which is what makes identifying deductions a challenging task. Copyright © 2024 iNymbus.All rights reserved. 12

13. DECODING DEDUCTION CODES AND DISPUTE PROCESSES Some retailers, such as Amazon, have different sections for various types of deductions, including chargebacks, shortages, and pricing claims. Conversely, some retailers consolidate all deductions in one place and label them with different deduction codes, further complicating the dispute resolution process. Different Methods for Disputing Deductions Major retailers like Amazon, Walmart, and Target provide their own portals where invoices with deductions are accessible, and disputes can be raised within the same platform. However, this streamlined process is not universal among smaller retailers. Many smaller retailers may offer portals where deductions are listed, but disputing them often requires drafting individual emails for each deduction, accompanied by relevant documentation. Copyright © 2024 iNymbus.All rights reserved. 13

14. DECODING DEDUCTION CODES AND DISPUTE PROCESSES Documents Required To Dispute Deductions Navigating deduction disputes requires meticulous attention to detail and the proper documentation to support your case effectively. 2.Proof of Delivery 1. Bill of Lading A document confirming that This document serves as goods were delivered. It serves proof of shipment and delivery. as proof that the recipient It provides important received the package in a information about the goods good state. being tranported. 4.Invoice 3.Purchase Order An invoice is a document An official document detailing issued by a seller to a buyer the products or services requesting payment. It lists ordered by a buyer, serving as product costs and can serve a reference point for disputes. as a legal record. Copyright © 2024 iNymbus.All rights reserved. 14

15. Chapter 3 Key Challenges in Deduction Management One of the primary challenges in deduction management is the time-consuming nature of manual processes. The Accounts Receivable teams often spend a lot of time manually dealing with deductions, which leads to inefficiencies and delays. Vendors frequently encounter frustration with chargeback and deduction processes. There's a belief among vendors that retailers like Amazon and Walmart intentionally complicate chargeback processing, adding hurdles for vendors to dispute these claims. As volume grows, the limitations of manual deduction management become increasingly apparent. While temporary measures like seasonal hiring, effective organization, structured procedures, and guided support may provide short-term relief, they fail to address the fundamental issue of scalability. Copyright © 2024 iNymbus.All rights reserved. 15

16. KEY CHALLANGES IN DEDUCTION MANAGEMENT Here are The Key Challenges in Deduction Management : 1. Lack of Prioritization : Failing to prioritize deduction management can result in missed opportunities for timely dispute resolution and revenue recovery. With limited resources, companies may overlook high-value deductions in favor of addressing more manageable cases. Copyright © 2024 iNymbus.All rights reserved. 16

17. KEY CHALLANGES IN DEDUCTION MANAGEMENT 2. Time Consumption : Manually processing deductions is extremely time-intensive, involving laborious steps like document retrieving, organizing, uploading, and disputing, all prone to errors when done manually. 3. Revenue Leakage : Unresolved deductions can lead to revenue leakage and directly impact the company's cash flow. Failure to dispute invalid deductions or recover rightful claims can result in substantial financial losses over time. 4. Inconsistent Documentation : Poor documentation practices can result in confusion, delays, and difficulties in tracking and resolving deductions properly. 5. Lack of Automation : Without automated processes, businesses struggle to keep pace with the increasing volume and complexity of deductions. Manual efforts quickly become overwhelmed, leading to backlogs and delays. Copyright © 2024 iNymbus.All rights reserved. 17

18. KEY CHALLANGES IN DEDUCTION MANAGEMENT 6. Manual Processes : Traditional deduction management methods rely heavily on manual tasks that increase the risk of inefficiencies, delays, and human errors, slowing down resolution times and consuming valuable resources that could be better allocated elsewhere. These challenges emphasize the need for a comprehensive and automated solution to streamline deduction management processes, mitigate risks, and maximize revenue recovery. Copyright © 2024 iNymbus.All rights reserved. 18

19. Chapter 4 Benefits of Automated Software Automation has emerged as a game-changing solution in the domain of deduction management. It offers businesses a powerful tool to address the challenges associated with manual processes. By leveraging cutting-edge technologies like cloud-based robotic process automation (RPA), companies can unlock a range of benefits. Copyright © 2024 iNymbus.All rights reserved. 19

20. BENEFITS OF AUTOMATED SOFTWARE 1. Root Cause Analysis : By leveraging comprehensive data on deductions from all retailers, suppliers can enhance their understanding of their origins in the first place. 2. System Integration: Automated software in the market are able to seamlessly fetch data from various sources like EDI or ERP of the suppliers hence reducing the manual cross-communication. 3. Cost Reduction : By automating labor-intensive tasks, businesses can significantly reduce the cost associated with deduction management, resulting in freed resources for higher-value activities and improved profitability.

21. BENEFITS OF AUTOMATED SOFTWARE 4. Decision Insight : Access to data analytics empowers businesses to make informed deductions. This includes preventive strategies, process optimization, and resource allocation. 5. Streamlined processing: Robotic process automation can process deductions at a much faster rate than humans, leading to reduced processing time and quicker dispute resolution. 6. Scalability and Flexibility : Automated solutions offer scalability to handle high deduction volumes without requiring more resources, and flexibility to enable customization to suit individual business needs.

22. Chapter 5 Introducing The iNymbus DeductionsXchange iNymbus' DeductionsXchange is a powerful and comprehensive solution that harnesses the power of cloud-based robotic process automation to revolutionize deduction management for vendors and suppliers. Let’s see how iNymbus helps your business and the advantages: Copyright © 2024 iNymbus.All rights reserved. 22

23. INTRODUCING THE iNymbus DEDUCTIONXCHANGE 1. Automated Dispute Resolution : iNymbus captures and manages 100% of retailer claims, and automatically handles claim initiation, validation, and resolution. This way it reduces manual intervention, ensures process consistency, and improves overall operational efficiency. 2. Integration with Major Retailer Platforms : It supports Integration with 25+ major retailers and provides a centralized deduction hub for a unified view of deductions from all retailers for improved visibility and deduction management. 3: Data Analytics and Reporting: It provides valuable insights into chargeback trends, root causes, and patterns, helping identify areas for improvement and enabling proactive issue resolution. Copyright © 2024 iNymbus.All rights reserved. 23

24. INTRODUCING THE iNymbus DEDUCTIONXCHANGE 4: Scalability and Flexibility : As a cloud-based solution, it offers scalability for businesses of all sizes, flexibility to adapt to specific requirements, promotes efficiency, and provides a high degree of customization and integration capabilities. 5. Reduced Total Cost of Ownership (TCO) : iNymbus reduces TCO by bypassing complex ERP integrations and ongoing costs associated with IT support and consultancy services. 6. Automated Document Retrieval : iNymbus automates the retrieval of critical documents like invoices and bills of lading from portals, EDI, or emails, eliminating manual document collection and organization, saving time and reducing errors. BOL POD INV BOL POD POD INV BOL PO INV POD PO INV PO PO BOL EDI EDI EDI EDI Copyright © 2024 iNymbus.All rights reserved. 24

25. INTRODUCING THE iNymbus DEDUCTIONXCHANGE 7. Enhanced ROI : It maximizes ROI by eliminating expensive ERP add-ons, reducing manual processing efforts, cutting opera- tional costs, and boosting recovery rates. Copyright © 2024 iNymbus.All rights reserved. 25

26. Chapter 6 Measuring the Impact With Case Studies "I wasn't even aware there was a solution like iNymbus. Our issues are volume related - we ship directly to stores. “ Elaine Brockopp U&I Entertainment Case Study 1 : Large Book Distributor Reduces Cost-per-Claim by a Drastic 80-90% The distributor lowered their CPC from $5 to $1.5 with iNymbus automation. They also were able to clear the backlog, reducing chargebacks to zero in 90 days. Reduced chargebacks to zero within 90 days Cost savings of 80-90% per claim 26

27. MEASURING THE IMPACT WITH CASE STUDIES Case Study 2 : Giant Supplier with $2 Billion in Annual Revenue Tackles Deduction. With iNymbus' automated RPA, this supplier swiftly tackles deductions from over 20 retailers. Deductions that previously took weeks are now resolved within minutes. Direct costs are cut by 94%. 40 employees to a handful for dispute resolution. “ Walmart changed something in their process or system, and we couldn't keep up. ” Tony Warfield VP of D&H Distributing Copyright © 2024 iNymbus.All rights reserved. 27

28. MEASURING THE IMPACT WITH CASE STUDIES Trusted by 100+ Global Companies 6 Copyright © 2024 iNymbus.All rights reserved. 28

29. Summary The retail landscape has become increasingly complex, demanding a more strategic approach to deduction management. The manual process is no longer sufficient to handle the growing volume and complexity of deductions. Moreover, It can lead to wasted time, errors, and lower productivity. This is where iNymbus empowers businesses to automate deduction management, transforming a time-consuming burden into a strategic advantage. Through cloud-based automation, advanced data analysis, and centralized management, businesses can achieve the following advantages: Reduced Costs : The automated process minimizes manual efforts and reduces 80% associate costs. *Source - iNymbus | Case Study: Book Distributor Copyright © 2024 iNymbus.All rights reserved. 29

30. SUMMARY up to 30x Faster which allows your staff to focus on strategic tasks rather than system maintenance and data entry. Improved Revenue Recovery : Timely resolution of disputes improves the recovery rate of deductions, eliminating the resource drain often seen with cumbersome manual processes. Increased Visibility : Centralized deduction management provides a clear view of deduction trends and root causes from 25+ Retailers Scalability and Flexibility : iNymbus is a cloud-based robotic process automation (RPA) deduction software that is scalable for businesses of any size and flexible to meet specific needs. iNymbus represents a strategic investment, not just a technological upgrade, for businesses seeking to thrive in today's competitive environment. Copyright © 2024 iNymbus.All rights reserved. 30

31. 25+ Retailers “ Automation isn't just about replacing manual tasks; it's about empowering businesses to streamline processes, maximize efficiency, and focus on what truly matters. ” Click To Learn More ! https://www.inymbus.com/ Copyright © 2024 iNymbus.All rights reserved. 31