How is supplier claim recovery calculated?

Units times value per unit gives the claim value; the approval rate discounts it to gross approved recovery; subtracting your processing cost gives the net. For 1,200 units at $18 with 65% approval: $14,040 gross minus $500 is $13,540.

Why subtract the processing cost?

Because it is your cost, not the supplier's payment. The SQE hours, paperwork and sample freight are spent to obtain the recovery. An earlier version added it, which made more paperwork look like more recovery; the corrected figure sits one cost lower.

What approval rate should I assume?

This supplier's own approved-to-claimed history is the only defensible source. As a prior, well-documented claims on cooperative suppliers settle at 80 to 90%, contested or evidence-thin claims at 40 to 50%. The page warns at 95% and above.

When is a claim not worth filing?

When the net is zero or negative: the gross approved recovery does not clear your processing cost. The fixes are batching small events into one periodic claim, a standing debit agreement, or knowingly absorbing the cost.

Supplier Quality, Development & Audits calculator

Supplier Claim Recovery Calculator: Net of Approval and Processing

Forecast what a supplier chargeback will actually return. Enter claimable units, value per unit, the approval rate and your processing cost; net recovery, gross approved value and claim efficiency come back.

What this calculator does

Forecast a chargeback's net recovery after the approval discount and your processing cost.

Formula used

Gross approved recovery = units × value per unit × approval rate
Net claim recovery = gross approved recovery − processing cost
Net recovery per unit = net recovery ÷ claimable units
Net share of claim value = net recovery ÷ claim value × 100

Inputs explained

Claimable Defective Units: Units traceable to the supplier and defect with evidence.
Recoverable Value per Unit: What the supplier credits per unit, per the contract.
Expected Claim Approval Rate: Share of claimed value this supplier's history supports.
Claim Processing and Admin Cost: Your one-time cost to file and chase the claim.

How to use the result

Best suited to deciding whether a small claim clears its cost, forecasting quarterly chargeback recovery, separating memo value from ledger value.
The approval rate is an estimate; the forecast is only as good as the history behind it. Recovery is a fraction of the escape's full cost; line-down and warranty rarely charge back.

Current U.S. benchmarks

U.S. manufacturing runs at 75.7% of capacity (Federal Reserve, Aug 2026). New factory orders are up 8.5% year over year (Census).

Common questions

How is supplier claim recovery calculated? Units times value per unit gives the claim value; the approval rate discounts it to gross approved recovery; subtracting your processing cost gives the net. For 1,200 units at $18 with 65% approval: $14,040 gross minus $500 is $13,540.
Why subtract the processing cost? Because it is your cost, not the supplier's payment. The SQE hours, paperwork and sample freight are spent to obtain the recovery. An earlier version added it, which made more paperwork look like more recovery; the corrected figure sits one cost lower.
What approval rate should I assume? This supplier's own approved-to-claimed history is the only defensible source. As a prior, well-documented claims on cooperative suppliers settle at 80 to 90%, contested or evidence-thin claims at 40 to 50%. The page warns at 95% and above.
When is a claim not worth filing? When the net is zero or negative: the gross approved recovery does not clear your processing cost. The fixes are batching small events into one periodic claim, a standing debit agreement, or knowingly absorbing the cost.

Related guides

Last reviewed 2026-10-01.