Deductions are, quite simply, the difference between the amount of a manufacturer's invoice and the amount of a distributor's actual remittance. Deductions must be reconciled, and the time and effort to do this represents a significant cost to the Canadian food and consumer packaged goods industry.
Studies continue to show that deductions consume far more resources than they should, considering the amount of money the company can expect to recover despite their legitimacy. At the same time, a business that does not address deduction issues faces increased unwarranted pressure.
The FCPC Deductions Working Group, a cross functional group made up of individuals from sales, supply chain, and credit organizations focusses on the following key areas:
- Best practice sharing and process improvement on internal practices
- Retailer teams to meet with individual retailers quarterly on deduction related concerns/opportunities
- Working towards a revised industry protocol with RCC and CFIG
For more information please read, "Taking the Unexplained out of Deductions"