Wal-Mart Updates Suppliers About On-Time, In-Full Progress

Wal-Mart’s on-time, in-full (OTIF) shipping mandate for suppliers comes at a time when a perfect storm is brewing in the transportation and logistics sector. Tight truckload capacity is raising shipping costs as much as 9%, according to Colby Beland, vice president of sales & marketing for Fayetteville-based CaseStack.

Throw in the added holiday rush and hurricanes that crimped the supply chain, and there is a perfect storm brewing at precisely the time Wal-Mart wants suppliers to hit a 95% on-time ratio using a one-day window, he said. For less-than-truckload carriers like Fort Smith-based ABF Freight and FedEx, the bar was set lower, but all suppliers began facing fines in August if they missed the retailer’s new OTIF guidelines.

Wal-Mart has discussed its OTIF initiative many times since first announcing the changes in February, and each time executives say the agenda is needed because customers expect products to be on the shelf. Tighter delivery windows also help Wal-Mart control inventory costs and clean up its back rooms.    MORE

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