Introduction - Vendor Credits
A vendor credit is money a supplier owes you back, usually after a short, faulty or over-charged delivery.
It is the correcting document on the purchase side, and it is the natural end of a mismatch the receive caught. The bill said one thing, the delivery said another, and this is how the difference gets recorded rather than argued about by email.
What usually causes one
| What happened | Why a vendor credit |
|---|---|
| You were billed for more than arrived | The receive is the evidence. The credit is the correction |
| Goods arrived faulty and you are keeping them | Nothing is going back; the price should come down |
| The bill used the wrong price | The goods were right, the amount was not |
| You returned goods to the supplier | The credit follows the goods out |
Applied or refunded
- Appliedthe common case
- Set against another of that supplier's bills, reducing what you pay next. It needs an open bill to apply to.
- Refundedreal money back
- The supplier pays you. Worth insisting on when the trading relationship is ending, and rarely worth chasing otherwise.