New Netting Guide Process

1. Netting – This is the process of offsetting funds due to be exchanged between suppliers and the John Lewis Partnership (JLP).

For Example – JLP is due to pay a supplier (XYC PLC) £500.00.

JLP is owed £350.00 from the supplier for a rebate.
JLP would therefore net £350.00 against the £500.00 value payable.
JLP would pay the remaining £150.00 to XYC PLC when due.

2.  Remittance – You will only receive a remittance from JLP when a physical payment has been made (i.e., when a payment is made after netting, or when no netting occurs). 

Under this new process, separate netting advice is no longer supplied. This is because the deduction is now applied to the total amount owed to a supplier, rather than being subtracted from a specific invoice. Consequently, a 'debit balance' may occur until further supplier invoices are due for payment.

3.Important - To resolve a Debit Balance, you have the following options:
Clear Balance with Submissions: Choose to remain in a Debit Balance. The outstanding amount will be cleared automatically as new invoices are submitted.
Immediate Payment & Invoice Cancellation: Make a payment for all invoices listed on the Open Invoice Report that start with 'NET'. Once this payment is received, we will cancel the Partnership invoices that resulted in the Debit Balance.
Payment Instructions: To make a payment, please use the bank details found at the bottom of your invoices. Ensure you reference your Account number with the payment. A Remittance Advice must also be sent to ar.receipts@johnlewis.co.uk so we can accurately allocate the funds.

4.Netting entries will be listed on your remittance in the line-item section with the prefix NET followed by the invoice number that the netting has deducted, and a unique reference (e.g., NET_3012012345_XXXXX). It is important that you review your remittance advice in order to allocate your transactions correctly.

5.

(1) Total Gross Amount – This is the total value of all line items (invoices and netting deductions) on the remittance. This figure represents the amount payable after all netting deductions, before any early settlement discount on the payment itself.

(2) Discount Taken – This is the amount of early settlement discount taken on the physical payment JLP has made – this does not include any previous discount taken on the netting.

(4) Total Paid Amount – This is the final amount paid. It is calculated as the Total Gross Amount (1) minus the Discount Taken (2), and also includes any discount taken on the netting.

(5) Vendor Number – This is your supplier number

(6) Reference – This is the BACS reference number

For further assistance please call the accounts receivable team on 0345 6100 333 options 1 and 2.