How Robots Score 5-0 Vs Amazon in the Dispute Resolution Challenge

Introduction
Accounts Receivable is probably the toughest job in the finance portfolio since it primarily involves convincing external parties to part with their hard-earned savings. A customer might cite multiple reasons for why they cannot pay an invoice, but an unresolved dispute is the only valid one which provides a reason why they should not pay an invoice.
AR teams across organizations of all industries and sizes, are keen to resolve any open disputes and clear the payment but resolving customer claims/queries is not a cakewalk. It is  a complicated process which involves

• back-and-forth across multiple teams such as sales, credit
• aggregating documents such as claims, POD, BOL from various sources
• disputing timely with proper denial correspondence

Further complications arise when you are receiving a high volume of claims from a single major customer, such as Amazon, and your analysts have to deviate from their normal routine to resolve these queries, such as logging into a specific web portal such as Vendor Central to manually dispute these claims.

Customer, carrier, and vendor portals are a specific niche when it comes to A/R automation and Amazon Vendor Central is one of the most widely used customer portals owing to Amazon’s omnipresence. However, customer portals including Vendor Central are notorious for making life hard for analysts trying to transact on them. So how do you handle customer portals and save productive time while improving process outcomes? Read on to discover….

This e-book is for you if
you or your team are handling resolving customer queries/claims on  their web portals and can relate with any of the below:

1. Raising disputes is a taxing exercise – It involves navigating through claims in the VC (Vendor Central), identifying the dispute, attaching the proper backup documentations and posting it. This takes time and highly inefficient. Will a technology solution eliminates the manual steps associated with dispute resolution in VC?
2. Vendors are penalized for no fault of their own – Invalid deductions pop up frequently where the vendors get disputed without any valid reason and get charged for it. Will technology provides options to counter against invalid claims?
3. Lack of visibility – A primary driver for boosting operational efficiency is to achieve real-time end-to-end managerial view of metrics and statistics. Will technology allow me to complete visibility to adopt corrective measures based on drill-down capabilities
4. Lack of preparedness for the future – Any enterprise-grade technology solution must be ready for the future. Will the technology solution remain relevant in the face of the growing deduction volumes and complex dispute resolution workflow?
   Read on as we try to address the above issues by presenting a use case of Amazon Vendor Central.

Highly manual processes for disputing in Vendor Central
Disputing claims on Amazon Vendor Central is a challenge due to a largely manual-driven process coupled with a non-intuitive interface. Some of the key issues associated with disputing on VC are:

1. Claims download
   This process involves dispute analysts to log in multiple times in the system throughout the day just to check for claims. Every claim has to be manually downloaded from the portal as it cannot be fetched in bulk.
2. Document upload
   Documents such as claims, remittance, proof of delivery, bill of lading have to manually collected by analysts from multiple sources and upload individually into the portal for every single claim.
3. Information key-in
   Information related to each dispute has to be painstakingly keyed into the portal. Given the large claim volumes, this could delay raising disputes significantly.
4. Manual correspondence
   Every time there is an invalid dispute, analysts have to manually type and send the denial correspondence with relevant documents attached, such as claims, POD, BOL, to Amazon.
5. Non-standardized cross-team collaboration
   Given that disputes involve teams from multiple departments, including cash allocation, collections (if handled separately), logistics, sales, and supply chain, analysts often end up wasting time in coordination instead of actual dispute research.
   As a result, dispute resolution:

Turns Highly Manual
• Adds little value
• Turns Time consuming
• Misfires on Metrics

Why not let robots do these menial tasks?

1.Claims and POD Aggregation

“As a result, all claim/dispute information are exported from Vendor Central in one single batch eliminating the need for manual download “

2.Auto-coding Deductions

“Time spent on dispute identification and coding is now saved and they are directly assigned to analysts who directly start working on them.”

3.Web Push

“For invalid claims, denial package uploaded to Vendor Portal attached with POL, BOD, ASN, same day the deduction is claimed“

4.Dispute Correspondence

“Analysts don’t have to separately write emails, attach documents for each customer“

5.Audit Trail

“Disputing timely with proper backup documentation results in faster resolution“

1.Shortage Deductions

Why do they happen

“86% of companies said that shortage deductions have increased in the past 6 months – Amazon Deduction Issues/Findings, Attain Consulting Group”

How they are currently resolved

1. Analysts login to VC and download each claim manually
2. The ASIN number in the claim is manually matched with the invoice number in the ERP. The ASIN appellation of Amazon is complicated and modified repeatedly
3. Analysts go through the claims individually and identify the shortage disputes
4. Analysts collect backup documents from carrier portals, emails, paper
5. Analysts open each dispute separately in VC and upload the relevant documents such as POD, BOL, claim
6. Analysts key-in the relevant information in VC for each dispute

How does Automation help

2.Pricing Deductions

Why do they happen

“65% of vendors said that they experience pricing challenges with Amazon  – Amazon Deduction Issues/Findings, Attain Consulting Group”

How they are currently resolved

1. Analysts login to VC and download each claim manually
2. The ASIN number in the claim is manually matched with the invoice number in the ERP
3. Analysts go through the claims individually and identify the pricing disputes
4. Analysts login to VC and download negotiated pricing document
5. Analysts upload the pricing documents relevant to that particular pricing dispute
6. Analysts key-in the relevant information in VC for each dispute

How does Automation help

3.Co-op Deductions

Why do they happen

How they are currently resolved

1. Analysts login to VC and download each claim manually
2. The ASIN number in the claim is manually matched with the invoice number in the ERP
3. Analysts go through the claims individually and identify the co-op disputes
4. Analysts check product catalog and pricing agreement in VC
5. Analysts go back-and-forth across Sales and Credit teams for deal sheets and trade documentation
6. Analysts key-in the relevant information in VC for each dispute

How does Automation help

4.Vendor Chargebacks

Why do they happen

Amazon will review your performance from the prior six weeks and issue Amazon Vendor chargeback fees based on the following criteria:

• 2% cost of product: if the ASNs submitted have less than 100% compliance but greater than 95% from the trailing six weeks.
• 4% cost of product: if the ASNs submitted have between 70% – 95% compliance from the prior six weeks
• 6% cost of product:  if the ASNs submitted have less than 70% compliance from the prior six weeks

How does Automation help

Audit trail

Robots track all forms of communication with vendor and stores all backup documents in one source for effortless disputing in case of invalid chargebacks

Auto- compliance

• Attaches all relevant documents for disputing
• Eliminates errors due to manual keying in
• Disputes as soon as a claim is raised

5.1 Bonus: Dispute Validity Predictor

Why auto-resolve disputes?

What Robots can do?

5.2 Bonus: Drill-down Capability

Additional visibility with Reports

Robots provide real-time out-of-the-box and custom reports for end-to-end managerial view


What Robots can do?

“It allows drilling down on inefficient sub-processes and applying speedy corrective measure”

• Reports provide a view on the number of deductions and the type of deductions happening periodically for different geographies, warehouses, vendors and customers
• Reports provide C-level Executives with visibility on cash flow and working capital metrics such as Deductions Day Outstanding, write-offs, volume of deductions, deduction values and more
• Reports allow managers to track the productivity of analysts and take instant corrective actions on identifying process inefficiencies

Before

• Each claim is manually downloaded from VC for resolving resulting in delayed dispute resolution
• Vendors wait for 30 days for repayment and then raise dispute, if not paid
• No option to batch deductions
• All data elements need to be manually keyed in when disputing
• Piling up of unresolved disputes results in more write-offs
• Insufficient time dedicated to research and resolution of disputes
• High Days Deduction Outstanding and low invalid deduction recovery

After

• All claims are pulled from VC in a single batch, along with BOD, POD from portals
• Dispute raised with proper backup as soon as invalid claim is raised
• Deductions can be processed en masse
• Data elements automatically entered into the system with high accuracy
• Automated resolution results in lower write-offs
• With automation analysts have additional bandwidth to research and resolve disputes
• Less DDO and high invalid deduction recovery