What Is Payment Advice (820)?
The 820 Payment Order/Remittance Advice is an EDI document that a retailer sends to tell you how much they are paying you and which invoices the payment covers. Think of it as the electronic equivalent of a check stub or remittance slip that arrives with a payment.
When a retailer processes your invoices and sends payment, they also transmit an 820 document through the EDI connection. RetailReady receives this document and automatically matches it to the invoices in your system, so you can see exactly what was paid and what was not.
What the 820 Tells You
Each 820 document typically includes the following information:
- Total payment amount: The total dollar amount being sent to you in this payment.
- Invoice references: A list of the specific invoices this payment covers, along with the amount applied to each one.
- Adjustments and deductions: If the retailer withheld any amount, the 820 shows why. This could include compliance fines, early payment discounts, co-op advertising charges, or other deductions.
- Payment date: When the payment was issued or when you should expect to receive it.
Why Payments May Not Match Your Invoice Totals
One of the most common surprises for new suppliers is receiving a payment that is less than the total they invoiced. This does not necessarily mean something went wrong. Retailers routinely apply deductions before sending payment. Common reasons include:
- Early payment discounts: If your agreement includes terms like "2/10 Net 30" (meaning the retailer gets a 2% discount if they pay within 10 days), the retailer will deduct that discount automatically.
- Compliance fines: Chargebacks for late shipments, missing ASNs, or other violations are deducted from your payment.
- Allowances and co-op charges: Marketing contributions, slotting fees, or promotional allowances that were agreed upon in your trading partner agreement.
- Damaged goods or returns: If the retailer received damaged product or processed returns, they may deduct the cost.
Payment Timing
How quickly you get paid depends on the payment terms you have with each retailer. Common terms include:
| Payment Terms | What It Means |
|---|---|
| Net 30 | Payment is due 30 days after the invoice date. |
| Net 60 | Payment is due 60 days after the invoice date. |
| Net 90 | Payment is due 90 days after the invoice date. |
| 2/10 Net 30 | 2% discount if paid within 10 days, otherwise full amount due in 30 days. |
RetailReady displays received payments as they arrive via 820 documents, so you can track payment activity over time.
How RetailReady Handles Payments
When an 820 arrives, RetailReady automatically:
- Matches the payment to the invoices it references.
- Updates each invoice's status to "Paid" (or partially paid, if applicable).
- Records any deductions or adjustments for your review.
- Flags any discrepancies, such as payments for invoices that do not exist in your system.
You can review all incoming payments in the Payments section of RetailReady, where each payment shows the associated invoices, amounts, and any deductions applied.