What Is a Credit Memo?

Some of the money your vendors owe you slips away every month — unless something asks for it back. That something is the credit memo. Let's break down what it actually is.

Every month, product comes back, gets damaged, or has to be marked down just to move it. A lot of that cost was never yours to eat — it belongs to your vendor. This page is where you claim it back.

So what is a credit memo, exactly? It's a formal, documented request to one vendor for the money they owe you. ShelfSpace builds it from your own point-of-sale and Metrc data, rolls it into a single PDF each month, and sends it to the vendor to review.

Every credit memo draws from four kinds of credit — customer returns, waste and destruction, co-marketing promotions, and aging markdowns. Each one has its own rules for what qualifies.

But first, the one rule you can't get wrong. On a consignment order, you only pay as product sells — so the vendor already shares every discount through their split. That's why consignment product can be credited for returns and waste only. On a wholesale order, you bought it outright, so the vendor also shares co-marketing and aging markdowns. Mix these up in a vendor conversation, and you'll lose their trust fast.

Back here, every credit memo lives on your Credits page — one per vendor, every month. Each one moves through clear stages: draft, out with the vendor, approved, and applied — so you always know exactly where it stands.

And that's a credit memo — the documented, defensible way to recover what your vendors owe you, month after month. And every dollar on it came from data you already have.