Thought Leadership: Financial Services

Understand And Optimize Your Deductions

Deductions, also known as chargebacks, happen when retailers or distributors don't pay their invoices in full to CPGs and manufacturers — and the $ can add up fast! That’s why it’s so important to assess them quickly, see if they’re actually valid, and determine if you should push to get that money back. 

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DIGITAL-FIRST CONSUMER APPEASEMENT PAYMENTS: THE KEY TO FOSTERING LOYALTY

Fragile customer loyalty and the power of peer influence can create liability if customer complaints are not resolved quickly and completely. When brands solve issues effectively, they increase retention. According to our recent survey, 63 percent of unhappy customers are likely to buy a product again if the brand resolves the issue effectively. So, how can brands leverage consumer payments to turn dissatisfied customers into brand advocates for life? The answer is in our new infographic, where we dig into:

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How Digital-First Experiences Can Drive Better Consumer Engagement

Listen to our most recent webinar where Inmar’s GM of Payments, Sylvain Mansier and guest Forrester Senior Analyst Lily Varón had an in-depth conversation about payment trends and how brands can adapt new, digital-first strategies to increase loyalty and consumer engagement. As digital payments gain steam, cash and check usage are dropping quickly. Not only do consumers prefer faster and easier digital payments — which can help boost loyalty — but migrating from paper to digital also reduces business costs.

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How To Build An Expert Deductions Management Strategy

Retailer deductions — at any time — present a risk to brands. Up to 20% of retailer deductions are disputable, but accounts receivable (AR) teams often lack the time and resources to effectively manage those deductions and reclaim that cash. And in the face of high inflation, supply chain disruptions, and a volatile market, the pressure on AR teams to protect profit margins is higher than ever.

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From Deductions Inspector to Profit Protector In 5 Steps

Deductions are CPGs’ second-highest cost behind cost of goods — and CFOs know effective deductions management can make or break profit margins. While automation and AI have made a splash in back-office functions, people are still a company's most valuable asset — but only if they’re able and empowered to let go of the administrative work and take on higher-level, more strategic responsibilities. This is when automation and people together make an unstoppable team.

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Improve Recovery Rates With These 3 Deductions Metrics

Deductions management is a critical function of CPGs. Cash recovery, retailer relationships, even insights into opportunities for process improvement, depend on this work by AR teams. Unfortunately, deductions management can also be time-consuming and overwhelming — making it difficult to get ahead. But optimizing processes and leveraging deductions information for growth isn’t rocket science — it can be done by measuring these three metrics:

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Cash Recovery Starts With Collaboration

Deductions management is messy — accounts receivable teams at CPG companies know this to be true. Deductions flood in from multiple different retailers, in various formats, with vague descriptions. But effective deductions management is vital for cash recovery and harmonious customer relationships, and many brands overlook a critical aspect of effective management — communication with internal stakeholders.

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2022 Deductions Management Trends Report

For accounts receivable (AR) teams at CPG companies, deductions management is a necessary evil – essential for cash recovery, yet time-consuming and tedious. Is there another way? We set out to find the answer by surveying over 300 CFOs, financial decision-makers, accounts receivable leaders, and controllers at CPG companies. Our goal – learn how brands are managing their deductions at an industry level, and leverage the data to identify opportunities for improvement.

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How Automating Deductions Management Protects Margins

Like death and taxes, deductions are a fact of life for CPGs – and can be equally dreaded. Deductions management is often tedious and time-consuming, but this necessary task can have a major impact on profitability, cash flow and retailer relationships. Deductions account for 15-20% of brand revenue, and, when managed effectively, can drive company-wide growth.

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