Date: Apr 14, 2021
Category:

Fresh produce shippers are used to dealing with unique retailer demands getting their product to market. One such challenge, first introduced by Walmart U.S. in 2017, is the retail giant’s on-time in-full (OTIF) policy. As the name indicates, this logistics compliance program requires product to arrive at Walmart’s distribution centers on time and in full. Shipments that arrive early, late, short, or not otherwise as specified in the Purchase Order, are all subject to fines. 

While OTIF has been in place for several years, Walmart recently modified its targets, making compliance even more difficult, if not downright impossible. In effect since September 15, 2020, shippers that fall below the newly raised 98% on-time in-full target are subject to an automatic 3% total cost of goods fine. Put simply, 98% of all supplier deliveries must arrive on their Must Arrive By Date and must contain 98% of the cartons ordered, or penalties will be enforced. 

One of the key concerns is that if a shipper scores less than 98% OTIF on orders during a given period, Walmart will take deductions on all orders during that period, potentially affecting a shipper’s entire program. This can be problematic since, according to a McKinsey & Company report, nine out of ten “late” shipments are set to fail even before the load is picked up.

If you are a Western Growers regular member that does business with Walmart, we’d like to hear from you. Western Growers is committed to supporting our membership and requests any additional OTIF feedback be sent directly to Bryan Nickerson in the Trade Practices Department at bnickerson@wga.com or 949- 885-2392. All information will be kept confidentially.

Additionally, follow www.wga.com to learn about an upcoming OTIF Education & Best Practices webinar which will be held in June 2021.

WG Staff Contact

Bryan Nickerson
Manager, Trade Practices
949-885-2392

Produce Insights

Stay up to date with best practices for selling and shipping fresh produce with our insider blog. Produce Insights offers expert guidance on all things related to PACA, product arrival issues, product guarantees, collections on slow pay, disputed contracts and so much more.

Members have relied on information from Western Growers when they’re in a pinch – trusting in our team's vast experience working with the produce industry, the DRC, CDFA, USDA and PACA to save them millions of dollars over the years.

Produce Price Index

Think farmers are making most of the money from your grocery bill? Think again. Use the Produce Price Index (PPI) to find out the difference between how much you spend on fruits and vegetables and how much actually goes back to the farmer.

Subscribe to Produce Insights

Subscribe to Produce Insights

Fill out the following form to get updates to the Produce Insights blog.

You May Also Like…

Bryan Nickerson