On January 31st, Walmart announced a change to its supplier OTIF (on-time, in-full) requirements via its Retail Link platform. Starting in 2020, 98% was the OTIF requirement. On February 1st, these requirements changed to 90% for on-time and 95% for in-full metrics.
How to Improve OTIF Performance
The consequences of not meeting OTIF standards go beyond fumbled revenue for not having product on the shelf. Walmart employs a minimum three percent fine of the cost of goods sold for all orders that arrive outside their OTIF program’s confines, and this adds up quick if a brand continually fails to deliver on time or in full.
In addition to these fines, brands that continually fail to meet OTIF standards are at risk of opening themselves up to involuntary sampling and damaging their retail relationships, hurting their chances to grow.
Shippers aiming to improve OTIF should align critical operational functions like production, transportation, and storage through insights gained from a visible supply chain.
Brands focused on delivering in full on a retailer’s requested delivery date will not only eliminate additional costs in retailer fines, but also bring in more gross profit by ensuring that their product is consistently present on store shelves.
To meet the newest OTIF standards at Walmart, it is critical that you work with a logistics solutions provider that understands complex delivery issues, has a reliable carrier network, and is equipped with technologically driven solutions that help you excel at retail logistics.
Speaking of which…
Master OTIF Requirements with Zipline Logistics
Successful CPG shippers are those that lean on a retail-specialized 3PL to consistently meet strict retail compliance requirements and eliminate out-of-stocks. Brands can grow their gross margin substantially just by increasing their on-time delivery performance to Zipline’s 95% average.
Big-box brokers focused on their bottom line won’t offer the same care, communication, or expertise Zipline Logistics promises on every shipment. We’d love the opportunity to prove ourselves to you just like we have with our biggest clients.