Walmart U.S. has raised the bar for its suppliers, demanding that they deliver more goods on time.
Tough competition with Amazon for online and in-store shoppers has driven the tightening of the rules for suppliers. Walmart has raised the delivery rate for a full truckload within a two-day window to 87 per cent from the previous 85 per cent, reports the Wall Street Journal. For suppliers that fill part of a truck with Walmart-bound goods, that rate has been raised from 50 per cent to 70 per cent. Walmart is also ramping up the penalties suppliers will suffer when they complete only part of a scheduled delivery.
Walmart has been trying to decrease inventory levels while improving product flow through warehouses and stores, in an effort to better position stores to accommodate online sales.
Walmart first began to penalize suppliers for delivery deficiencies in 2017. The WSJ says that while suppliers have improved their delivery metrics, incomplete deliveries still cause up to 30 per cent of out-of-stock readings in stores.