Wal-Mart tightens vendor deadlines

12 February 2010

12 February 2010 | Amy Rowe

Retailer Wal-Mart has unveiled tough new measures on supplier delivery times.

From this month, vendors to US operations will have a four-day delivery window leading up to a “must arrive by” date.

Suppliers that deliver less than 90 per cent of products each month within their delivery windows will be assessed for a “reimbursement” charge, worth up to 3 per cent of the total cost of goods sold. The charge also applies to vendors that deliver consistently early.

A Wal-Mart spokesman said: “This is about trying to maintain a steady and productive flow of goods through the supply chain, so we’re ready to receive the things we’ve ordered. Anything that deviates is a problem.”

Suppliers can go through an appeals process if there are extenuating circumstances that complicate a delivery, the company said.

Earlier this year, Wal-Mart set out plans to save up to $12 billion (£7.5 billion) as part of a procurement overhaul. The retailer will consolidate its store purchasing and increase the amount of goods it buys direct from suppliers, rather than through procurement outsourcing firms.

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