How a $160M pet supplies wholesaler got $1.1M back and stopped $600K a year of retailer fines

The problem

Lakeshore Pet Supply owns four pet brands, distributes three more and sells $160M a year to 14 retailers, including Chewy, Petco, PetSmart, Tractor Supply, Amazon and Walmart. Two acquisitions left it with three ledgers that were never joined, and product ships from two distribution centers and a third-party warehouse.

Every retailer pays short against its own deduction codes, through its own portal and inside its own dispute window. Working one deduction meant finding which system held the shipment, getting the signed bill of lading from the warehouse and filing in the portal: about two hours for a single $6,100 claim. With 800 deductions a month, the team could work a handful. The rest were paid, including fines that kept coming back for the same reasons.

What Seeft found

Seeft pulled 12 months of deductions from all three ledgers, 9,600 lines worth $9.8M under 212 codes, and tied every line to its shipment and its dispute window.

• $520K of the $1.45M in operational deductions did not hold up: shortages contradicted by the ship notice and signed bill of lading, fines on delivery windows the retailer had moved, and fines issued twice.
• $600K a year of valid fines came from four fixable causes. The largest was an order release that ran at 6 a.m. while retailer orders arrived in the afternoon.
• $890K of allowances were taken on terms that did not exist, and a 2 percent growth rebate owed by a supplier had never been invoiced, $270K.

What Seeft got back

Seeft filed each dispute in the retailer's portal inside its window, with the evidence attached, starting with the accounts with the longest look-back and the highest volume. Within 12 months, $330K of operational deductions was credited, $540K of allowances was reversed through the buyers, and the $240K supplier rebate was paid.

Seeft also sent operations the four root causes with a dollar value on each. Once they were fixed, those fines stopped, and operational deductions fell from 0.9 percent of gross sales to 0.5 percent.