Description
Code 21s are for concealed shortages. Concealed shortages are defined in three ways: Inner Ctn. Shortages / Inner Pallet Shortages / Part Supplier Pack. In any case, the shortage was not visible when the facility first received the shipment. The shortage was not found until the vendor pack was broken or the shipment arrived at the store.
Code 21s can be difficult to fight because the POD will often be signed in full based on the quantity of vendor packs.
Common Root Causes for Code 21s
A common cause is pack size discrepancies, where the actual number of units shipped doesn't match the purchase order or invoice. Another frequent issue is inadequate labeling, which can lead to misidentification of items or confusion during the receiving process. Finally, shortages may occur when the supplier fails to properly package the shipment or fulfill the purchase order, resulting in either a true shortage or a product substitution that wasn’t communicated or approved. Addressing these root causes can help minimize Code 21 deductions.
How to Prevent Valid Code 21s
Item Setup and Invoicing
Submit only one Invoice per PO when possible
Confirm your item setups
Vendor pack quantities
Warehouse pack quantities
Transmit invoices with Walmart item numbers
Match your invoice to the PO and don’t make adjustments on the invoice that don’t match the PO
match units of measurement on the Invoice to the units on the PO
If you disagree with the quantity ordered, do not short ship. Instead, coordinate with the Replenishment Manager or the buyer to request an updated purchase order.
Confirm that fulfillment information is correctly flowing to the warehouse (check your EDI)
Packaging and Labeling
DO NOT MASTERPACK
Identify the PO number and Facility number on labels
Be sure labels are clearly applied, not damaged or obfuscated
Use color-coding/imagery to differentiate between products
Use slip sheets between POs if palletizing freight
Use color-coding/imagery to differentiate between orders
It is best to avoid co-mingling inventory for different Purchase Orders. Walmart expects one PO shipment per pallet or per box unless you have an agreement with the RM stating otherwise. If you do include multiple POs in a shipment you must clearly separate them, though it is still not recommended as this is one of the most common reasons for invalid shortage claims.
Can it be Disputed?
Code 21s can be disputed but are often more difficult to win than standard code 22 or 24 shortages. If you can prove that the shipment was in full, then it is worth filing a claim in the Accounts Payable Disputes Portal (APDP) in Retail Link.
How to Dispute Invalid Code 21s
Supporting Documentation:
Purchase Order (EDI 850) showing requested quantities.
Proof of Delivery showing items received with the PO number clearly listed on the POD.
For store disputes, you’ll also need the matching delivery address.
For warehouse disputes, you need to include a POD signed for in eaches.