If you take a scroll through the latest Supplier Policies and Procedures document from KeHE (effective July 1, 2026), you might come across a little blip in the Payment Terms and Pricing section titled “Price Protection” (4.8). But don’t let its small real estate fool you: Understanding price protection is an important part of protecting your margins as a KeHE supplier.
Price protection is a contractual mechanism that ensures KeHE is compensated for decreases in the landed cost of products that the food distributor has already purchased. Unlike other chargebacks that function as penalties, it's more accurate to think of price protection chargebacks as true-ups.
However, honest mistakes happen, and price protection chargebacks can end up functioning as penalties if they’re erroneously applied to your payment.
This article answers the following questions:
How does KeHE define price protection claims and how are they triggered?
How does pricing work at KeHE?
What are KeHE’s guidelines regarding price change notifications and justifications?
Can price protection charges be disputed?
How does SPS Commerce support KeHE suppliers?
Related Reading: KeHE Deductions and Invoice Prefixes
What Is a Price Protection Claim at KeHE?
According to section 4.8 in KeHE’s Supplier Policies and Procedures, price protection “means a credit to KeHE for the difference between KeHE’s previous landed cost and KeHE’s new lower landed cost for all supplier product in KeHE’s inventory .... [including] price decreases that result from delivery method changes.” In such cases, the document continues, “KeHE will charge back the supplier the price protection credit based on the lost inventory value as of the effective date of any price change.”
Or to put it more simply, a protection claim is triggered when:
A supplier lowers the cost of a product.
KeHE still holds inventory of this product at the previous higher cost.
KeHE wants to recover the difference between the new lower cost and the former higher cost for all affected products in its inventory at the time of the price change.
Price protection chargebacks aren’t penalties or extra charges. They’re a form of recovery. KeHE is simply receiving a credit for the difference between the previous landed costs and the new lower landed costs. KeHE funds this credit by giving the supplier a chargeback.
Note: KeHE defines landed cost as the “supplier’s most recent price submitted to KeHE, plus all applicable freight and handling charges, fees, and expenses associated with moving the products into KeHE DCs.” Or if a formula is more helpful, Quickbooks provides the following breakdown:
Landed cost = product cost + shipping + customs + risk + overhead
Related Reading: Common KeHE Deductions (and How To Minimize Them)
How Does Pricing Work at KeHE?
As the KeHE Supplier Policies and Procedures document outlines, suppliers must include all product-related costs in their product price. Otherwise, KeHE will not pay them. This includes:
Taxes
Duties
Shipping
Other fees
KeHE defaults to designating suppliers as KeHE Pick Up (aka collect shipping) unless otherwise communicated and agreed upon. However, suppliers are required to provide KeHE distribution centers with pricing for both FOB origin (KeHE Pick Up) and FOB destination (supplier delivered), as well as a pick-up allowance.
KeHE says that it “may change a supplier’s delivery method at KeHE’s discretion with ninety (90) days’ written notice to the supplier.” Returning to the definition of price protection, you’ll see that it can be triggered by delivery method changes. Thus, there’s a chance that KeHE could make a change resulting in a price protection credit.
Related Reading: KeHE’s Compliance Program: Inbound Routing Guide Overview
What are KeHE’s price change guidelines?
KeHE’s rules for price changes — both decreases and increases — are also laid out in the Supplier Policies and Procedures document. KeHE suppliers must:
Submit all price changes via the KeHE CONNECT Supplier® portal.
Ensure all price changes are received by KeHE at least 90 days before KeHE’s published price change effective date. (This date is located in the KeHE Price Change Calendar within the KeHE CONNECT Supplier® portal.)
Include all required information (e.g., change justification, published supplier price list copies) for a price change submission to be counted as “received” by KeHE.
Honor any Every Day Low Price (EDLP) and Every Day Low Cost (EDLC) agreements affected by the price change until the agreements expire.
Following the steps above isn’t a guarantee that your price change will be accepted. KeHE may reject your submission if it determines that the increase is “unreasonable” when comparing it to information from the marketplace or competing product pricing.
Tip: Keep your price change documentation. KeHE can audit up to two (2) years of transactions, including price changes.
Related Reading: KeHE Promotions: Manufacturer Chargebacks (MCBs) and Extra Performance (EP) Fees
Can I Dispute a Price Protection Chargeback at KeHE?
If a price protection charge is valid, there is no reason to dispute it. However, if you think a price protection charge has been made in error, you can dispute it in K-Solve, a financial account tool within the KeHE CONNECT Supplier® portal.
Disputes must be submitted within 180 days of the original invoice date to be considered. KeHE advises allowing up to three weeks for the distributor to respond.
Related Reading: A Guide to Disputing KeHE Deductions in K-Solve
How Does SPS Commerce Support KeHE Suppliers?
You don’t have to navigate complex distributor requirements alone. Explore these tools that are setting up KeHE suppliers for success:
Do you need more KeHE-specific resources? Check out our library of KeHE supplier support materials.
Do you need support with EDI compliance? SPS Fulfillment gives your team one place to manage orders and documents and automatically rebuilds workflows as your business grows.
Do you want deduction management support? SPS Revenue Recovery for KeHE can help you identify and recover lost revenue.