Valence and Celonis bring agentic AI to deduction and dispute management

Summary: Valence Intelligence and Celonis have launched Celonis Deductions & Disputes Manager by Valence, an AI application built on the Celonis platform. It gives finance teams at consumer goods companies deduction management software that handles retail deductions from start to finish. Valence supplies the agentic data layer and the deductions workflow: it turns unstructured retailer, carrier and remittance documents into clean data, then codes, validates and disputes each deduction where needed. Celonis adds process intelligence across the ERP, along with advanced process mining and analytics. Together, they create an end-to-end deduction management platform, and the companies say resolution time drops from weeks to days. The app is available now on the Celonis Marketplace.

Why deductions are still a manual problem

Deductions are one of the largest unmanaged leaks in consumer goods finance. In the CPG sector they can account for 5% to 15% or more of gross sales. With net margins in the low single digits, a small share of invalid claims can erase a large share of profit.

The problem is also getting worse on three fronts:

• More deductions. Volumes keep rising as retailers add new deduction types. Valence saw deductions grow about 14% from 2025 to 2026.
• More invalid claims. Across its customers, Valence finds that 10% to 20% of deductions are invalid or overstated.
• Less time to dispute. Retailers are shortening dispute windows, so claims that wait in a queue simply expire.

The result: brands typically leak 1% to 3% of revenue to deductions they should never have paid.

Two kinds of deductions

A deduction is any amount a retailer subtracts from the invoice a brand sends it. They fall into two groups.

Trade deductions are planned and owned by sales. They cover promotions, coupons, markdowns, co-op advertising and paid shelf placement. Say a brand agrees to fund $3 off every bottle of salad dressing a grocery chain sells over 60 days. The chain counts the units sold and deducts the total from the brand's next invoices. Contracts add volume tiers and conditions, so checking each deduction is slow. The invalid rate is low, but 2% of $150 million in trade spend is still $3 million.

Non-trade deductions are unplanned. They include overage, shortage and damage (OSND), compliance chargebacks for labeling, packaging or delivery windows, unsellables, freight and storage fees, and early-payment discounts taken after the discount window closed.

In both cases, the retailer deducts first and asks questions later. The burden of proof sits with the brand.

Why the work doesn't scale

• Every retailer is different. Each has its own portal, reason codes, rules and deadlines. A shortage might be marked by an invoice suffix at one retailer, a numeric code at another and an alphanumeric chargeback code at a third. Some portals are over a decade old and take minutes to load a single page.
• None of it is programmatic. Analysts log in, open each payment, download each remittance and then hunt for the backup that explains each line, one by one.
• The evidence is unstructured. Proof sits in PDFs, scanned bills of lading and photos of proof of delivery where a driver crossed out 20 cases and wrote 19.
• The ERP alone can't resolve claims. It holds the invoice and credit memos but knows nothing about how each retailer builds its claims.

The economics follow. Handling one deduction takes an estimated 30 to 60 minutes of staff time. With thousands of deductions arriving each month, many teams write off anything under $250, or even up to $2,500, without looking at it. Retailer claims cluster in exactly that range. At one global consumer goods manufacturer Valence works with, 88,000 of 123,000 deductions over ten months were under $100. Those claims end up as a black box on the P&L.

Most deduction management software was built to track claims, not to read the documents that prove whether a claim is valid. That gap is what Valence and Celonis are targeting.

What Celonis Deductions & Disputes Manager by Valence does

The app uses AI to collect and interpret deduction data spread across retailer portals, carrier sites and internal systems, then validate each claim and dispute the invalid ones. Instead of analysts logging in to a dozen portals to build a case, AI agents pull the evidence and match it to the open claim.

Finance teams get:

• A real-time view of every deduction, combining ERP, retailer portal and carrier data in one place.
• Claim recommendations that flag which deductions are valid, which to dispute and why.
• Dispute packages built and filed with retailers, automatically or after analyst review.
• One-click resolutions for claims cleared for write-off, repayment or dispute.

Analysts move from gathering evidence to approving decisions.

Valence's role: the agentic data layer and the deductions workflow

Deductions are a document problem before they are a workflow problem. Process tools can't automate what they can't read, and retailer evidence is rarely available through clean APIs. Valence handles both problems: it reads the evidence, then runs the deductions workflow itself.

This is the layer Valence provides, in five steps:

1. Retrieve. AI agents log in to retailer portals and carrier sites every day and collect remittances, deduction backups, bills of lading, proof of delivery and invoices, for both 1P and 3P channels.
2. Structure. The agents extract fields from those documents down to the SKU level and turn them into structured, matched records.
3. Classify. Rules-based logic translates each retailer's codes into one reason-code taxonomy, so a shortage looks like a shortage at every retailer.
4. Validate. Each claim is tested against the retailer's rules, the external evidence and internal order, shipment and invoice data.
5. Dispute. For invalid deductions, Valence files the dispute directly with the retailer, evidence attached, and manages the case end to end.

Once these steps are complete in Valence, the results flow back to Celonis, which writes them back to the ERP. That closes the loop on both valid deductions (credit memo) and resolved deductions (bill-back). Customers get one seamless experience built on two best-in-class platforms and their data. And because carriers and retailers hold the real sources of truth, deductions can be validated and resolved even when they are missing from the ERP because of write-offs or other gaps.

Kevin Cunningham, CEO of Valence Intelligence, put it this way in the launch announcement: "Valence provides the agentic data layer that structures the messy retailer, carrier, and remittance data no one else can touch."

The division of labor is clear. Valence does the deductions work: retrieving and reading the evidence, then coding, validating and disputing each claim. Celonis provides process intelligence across the ERP and closes the loop with write-back. Without Valence, automation stops at the point where a human has to open a PDF.

What one claim looks like

A retailer's remittance shows a line of minus $430 with a reason code and no explanation.

Done by hand, an analyst decodes the reason code as a shortage, then finds the backup PDF in a separate part of the portal. It lists four SKUs the retailer says arrived short. Next come the invoice and purchase order, the carrier's name, and an email to the warehouse for the packing list, which can take a week to come back. Only then can the analyst get proof of delivery and compare.

With agents, the backup is already downloaded, its line items are extracted and the carrier's proof of delivery is attached. The system returns a verdict: invalid, because the proof of delivery shows the order delivered in full with no damage noted. Valence then files the dispute with that proof attached. Another claim might fail because the deducted SKUs were never billed on the invoice.

Multiply that by hundreds of thousands of claims a year, and the gap between the two approaches is the business case.

For teams evaluating options, our guide to AI deduction management software covers the evaluation criteria vendors won't tell you, including how to test classification accuracy on your own retailer documents.

Three outcomes for finance teams

1. Visibility into every deduction. ERP, retailer and carrier data sit in one live view. Controllers and CFOs can see open exposure by retailer, reason code and age, including the small claims that used to be written off unseen.

2. Cycle time cut from weeks to days. Automated evidence collection, reason coding, validation and dispute filing remove the slowest steps. According to the companies, resolution time falls from weeks to days.

3. Higher recovery. Retailer-specific validation catches invalid claims early and supports disputes and chargebacks before deadlines pass. When handling cost no longer depends on claim size, a $16 deduction is as worth disputing as a $16,000 one.

These outcomes connect to the wider order-to-cash automation agenda. Deductions are where cash application, collections and trade spend meet, so faster resolution improves cash flow forecasting as well as margin.

From "invalid" to cash recovered

Flagging a claim as invalid is worth nothing until the money comes back. At one manufacturer Valence works with, a single retailer and reason code produced more than 3,500 disputes to file, more than any existing team could absorb.

That is the job of Valence's dispute workflow, where people and AI agents work the same queue:

• Teams set the rules. An AI agent can take every dispute under a chosen dollar amount, while analysts handle high-value claims and ones that need a call with the retailer.
• Agents work within retailer limits. Submissions are paced with daily caps and working hours, the way a human analyst would file them, so retailer accounts aren't flagged.
• Resolutions sync back. Outcomes flow back to Celonis, which writes credit memos and bill-backs to the ERP.
• Root causes surface. Patterns in valid claims, such as a recurring packaging violation at one distribution center, point to fixes that stop the deduction from happening again. The best recovery is money that never leaves.

What it means for each team

• CFOs and controllers: one global view of deduction exposure, about 2 points of margin back, and a process that scales without adding headcount.
• Order-to-cash, AR and deductions teams: no more portal downloads and manual reason coding; analysts review recommendations and approve disputes.
• Sales and trade marketing: trade deductions checked against contracts and promotion terms without salespeople auditing the retailer's math.
• Supply chain: OSND and compliance chargebacks traced to the shipment, carrier or facility that caused them.

Why it matters that it runs on Celonis

The app is the latest addition to the Celonis Platform Apps program, which offers prebuilt, industry-specific solutions built by partners on the Celonis Process Intelligence platform.

For buyers, this has practical value:

• Faster approval. Companies that already run Celonis can add the app inside a platform procurement and IT have already vetted for security and data access.
• Existing process data. The app builds on the ERP connections and process models Celonis customers already maintain.
• One operating view. Deductions sit alongside the rest of order-to-cash in the same platform, rather than in a separate tool.

Liam Mawe, Global VP, AI and Industries at Celonis, said the app "handles the messy operational complexity these teams face daily and gives AI the context it needs to successfully automate these workflows."

How to get started

Celonis Deductions & Disputes Manager by Valence is available now on the Celonis Marketplace.

• Already on Celonis? Find the app on the Celonis Marketplace and add it to your environment.
• Want proof first? Pick one or two retailers and give us portal access. Within seven days we'll show you, in your own data, how much is recoverable and which claims to dispute first. Request a free leakage analysis.
• Evaluating deduction management software? Request a demo and we'll walk through a live claim, from evidence retrieval to resolution.

Teams that want to compare approaches can also explore Valence's 1P deduction management and 3P platform solutions, or the For CFOs overview.