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Retail Value Chain 101: What Suppliers Must Do Before Accepting a Purchase Order

Posted By Administration, Thursday, June 8, 2017
Updated: Wednesday, June 7, 2017


Merchandise suppliers bear just as much responsibility as retailers when it comes to starting a trading partner relationship on the right foot. Just like retailers need an effective supplier onboarding program, suppliers should have a formal onboarding process when bringing on a new retailer.

Due diligence is critical to ensure all ducks are in a row before a purchase order is accepted and that first shipment is sent. Remember, if you accept a purchase order and ship against it, that's the same as signing a document, and you'll be bound by those terms and conditions.

The first step for the supplier is to make sure salespeople are giving the rest of the organization a heads up that they're about to execute a business relationship with a retailer. Salespeople need to get their hands on the retailer's compliance guide, legal requirements, terms and conditions, vendor agreements, incentive programs and other documentation. The vendor compliance department or cross-functional team within the supplier organization needs access to this information so it can be reviewed before a purchase order is accepted.

A longstanding problem for suppliers is that salespeople often agree to terms before telling vendor compliance or the cross-functional team, who then have to figure out how to meet retailer requirements because the agreement has already been signed and the first purchase order has already been accepted.

As we discussed in RVCF's Compliance Management white paper, sales teams are not typically well-versed in compliance requirements or their own company's ability to meet those requirements. However, 43 percent of surveyed suppliers admitted that their salespeople tend to negotiate agreements with retailers, and 38 percent state salespeople sign agreements (and not usually with the consent of their company). In reality, there are a handful of people within the supplier organization – C-level executives and approved upper management – who should be signing agreements.

The legal team, as well as upper management, vendor compliance, finance and logistics, should be involved in reviewing terms and conditions, policies and other pertinent legal requirements. This will ensure that terms (payment, freight, risk, etc.), regulations (government, customs, etc.), and timeframes for implementations (EDI, etc.) are accepted or negotiated in a way that's agreeable for both sides.

For example, if the retailer wants to pay in 45 days and the supplier expects to be paid in 30 days, that discussion needs to take place before an agreement is signed and an order is shipped. Thorough documentation review will also protect the supplier from potential lawsuits.

Suppliers need to comb through the retailer's compliance guide, outline the retailer's requirements, and highlight requirements that might present problems. This information should be communicated internally to various departments that will be responsible for executing retailer requirements.

The next step is to create an agenda to discuss potential compliance issues with the retailer. Instead of seeking exemptions for every requirement that could be problematic, focus on finding alternative solutions. If there's a requirement you absolutely won't be able to satisfy in the first order, make sure you're prepared to explain the reasons. A retailer will be more likely to agree to a grace period or extension for that first order if you promise to make the necessary changes that will ensure compliance with future orders.

Finally, the supplier should find out if the retailer is offering programs that would apply to and be advantageous for the supplier. For example, if a supplier can show high accuracy with order fulfillment, pass retailer audits of merchandise, and properly perform value added services, they may qualify for a retailer's crossdocking program. Crossdocking allows the supplier's shipments to pass through the retailer's distribution center virtually untouched. This benefits both trading partners because it speeds the flow of merchandise by reducing or eliminating manual processing.

These are the basic but essential onboarding steps that a supplier should follow before accepting a purchase order from the retailer:

  • Make sure salespeople notify the appropriate departments about new retailer customers.
  • Have agreements negotiated and reviewed by authorized senior executives, not salespeople.
  • Have all terms and conditions, policies, legal requirements and regulations reviewed internally by the appropriate teams.
  • Comb through the retailer's compliance guide and collaborate with the retailer to find solutions to potential problems.
  • Find out about special programs offered by the retailer that can benefit the supplier.

RVCF created "All About Retail Compliance," an ongoing project and comprehensive reference that combines retailer requirements, industry standards and decades of retail supply chain knowledge to help anyone involved with retail compliance. As we roll out this series of informative references, we encourage suppliers to use this resource as a way to set a positive tone for new trading partner relationships, improve supply chain performance and increase profits. Learn more about this valuable reference on the Research & Studies page of the RVCF website.

CLICK HERE to return to the JUNE 2017 RVCF LINK

Tags:  Onboarding  Purchase Order  Vendor Agreements  Vendor Compliance 

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Retail Value Chain 101: What Is Supplier Relationship Management?

Posted By Administration, Thursday, April 6, 2017
Updated: Wednesday, April 5, 2017


Most retail industry professionals are familiar with the concept of customer relationship management (CRM). That's because most retailer organizations, like successful companies in other industries, have invested significant time and resources to implementing a CRM system that allows them to record and manage data from every customer interaction so they can build stronger customer relationships.

But CRM is more than software. It's a discipline that requires a strategy, goals, measurement and reporting to gather and apply the insights that drive improvements in operations, sales, marketing, customer service, and customer loyalty.

One could reasonably argue that supplier relationship management (SRM) is equally important to the success of a retailer organization. From the moment a merchant decides to add a supplier to their assortment, the retailer begins the complex process of partnering with the supplier for mutual success. All trading partner relationship strategies, tactics and business processes, such as onboarding, scorecarding, vendor compliance, EDI and returns, fall under the broader SRM umbrella.

SRM is the management of the retailer's interactions with merchandise suppliers in order to streamline processes and maximize the value of those relationships. SRM can also have an impact on the customer's loyalty to the retailer.

If retailers devote so much energy to better understanding, evaluating, quantifying and monetizing its customers, shouldn't retailers be doing the same with their hundreds or even thousands of merchandise suppliers?

For example, most retailers have a supplier onboarding program, but is it part of a larger supplier management strategy? For most retailers, onboarding is simply a business process that's the same for everyone. If you don't take a one-size-fits-all approach to CRM, why would you do the same with any part of your SRM plan?

All suppliers are not equal in their role and value to the retailer. Consider just a few examples of how differently suppliers are handled by retailers – depth and breadth of assortment support, margin expectations, product placement in store or online, product differentiation or exclusivity expectations, and even access and engagement with the retailer's senior management.

Instead of viewing the many things that fall under the SRM umbrella as independent processes, the retailer should approach them holistically to determine how they affect the retailer's ability to maximize sales and profits. If a supplier has to do all of these things to successfully partner with you, are you tracking their progress? Have you defined goals? How are you measuring performance? Are you offering the training required to enable suppliers to succeed? Is the effectiveness of that training being evaluated?

A thoughtful SRM plan supports this level of flexibility where it is needed while recognizing that there are numerous aspects of the trading partner relationship in which retailers strive for process and policy uniformity to maximize efficiency. For example, business process areas such as onboarding, EDI, purchase order management, packaging and marking, customs compliance, and accounts payable benefit from having all suppliers aligned and operating in the same manner.

Let's take a closer look at the first steps taken by retailers when beginning a new trading partner relationship – the supplier onboarding process. This is an essential part of SRM because, when properly managed, it sets the tone for a successful and profitable retailer-supplier relationship.

Effective onboarding requires the retailer to show a genuine interest in helping the supplier succeed and make the necessary preparations to facilitate that success. It also requires the supplier to do everything possible to satisfy retailer requirements. Best-in-class retailers follow three critical phases of effective supplier onboarding, as outlined in a recent RVCF white paper:

  • A thorough setup process within the retailer organization. Who will manage the onboarding process, gather information, maintain the database, and keep everyone on task and on time?
  • The education of the supplier and validation of the supplier's supply chain capabilities. How will the retailer's requirements be explained to the supplier? Is the supplier able to satisfy these requirements?
  • A detailed audit of the first shipment received by the retailer. Is the retailer carefully evaluating the first purchase order, shipment and receiving, and providing the supplier with detailed feedback?

To visit the RVCF Thought Leadership Store and download the white paper, 3 Phases of Effective Supplier Onboarding: How Best-in-Class Retailers Help New Suppliers Succeed, click here.

Supplier onboarding is one of many components that make up the critically important business discipline of SRM for retailer organizations. In future issues of the RVCF Link newsletter, we'll discuss other topics that fall under the supplier relationship management umbrella.

CLICK HERE to return to the APRIL 2017 RVCF LINK

Tags:  Onboarding  Supplier Relationship Management 

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3 Key Components to Successful Supplier Onboarding, Part 3

Posted By Administration, Thursday, March 10, 2016
Updated: Wednesday, March 9, 2016


If you want to minimize compliance issues and create a foundation for a profitable, mutually beneficial trading partner relationship, it all starts with an effective supplier onboarding process. Most retailers understand the importance of onboarding but few have mastered it. Two months ago, we kicked off a three-part series on successful supplier onboarding, starting with a thorough setup process within the retail organization. Last month, we discussed phase two – the education of the supplier and validation of the supplier's supply chain capabilities.

After the retailer has gathered and integrated all data into an accurate, up-to-date database, educated the supplier, and confirmed that the supplier can in fact meet the retailer's requirements, we move to the final step of the onboarding process – a detailed audit of the first shipment received by the retailer.

Best-in-class retailers will tell you that they watch that first order closely. They analyze how the order is shipped, how the pallets are configured, how the product is packaged, how everything is labeled and ticketed, the freight company, and the dock receiving appointment scheduling. Did the ASN arrive early enough? If so, does the order match what the ASN says?

It is critical for the retailer to conduct a thorough audit of the first order, and do it right away, so the retailer can provide immediate feedback to the supplier. Even if an issue is something you feel like you covered in detail with the supplier, you have to show them what was incorrect, explain why this mistake is a problem, and show them exactly what needs to be done to prevent the mistake from happening again.

Keep in mind that you may have to audit more than the very first shipment. If you receive different types of merchandise in different categories that have different shipping requirements, you may have to conduct multiple audits. This may seem like a lot of hand holding, but if you don't take the time to audit the first order, the supplier will continue to ship incorrectly, and these shipments could make it all the way to the store.

Instead of setting up the supplier to succeed and proactively working to solve problems, many retailers will simply issue chargebacks after the fact, which creates friction in the retailer-supplier relationship before it even gets started. Some retailers do this unintentionally, but it never feels unintentional when money is involved.

Business relationships are always great before people actually start working together. How the retailer supports the supplier during the onboarding process and how serious the supplier is about fixing problems and meeting retailer requirements right out of the gates, will often determine how profitable and amicable that relationship will be.

If you follow all three steps – executing a thorough setup process within the retailer organization, educating the supplier and validating their capabilities, and auditing that first shipment – you'll have the makings of a successful supplier onboarding program. Of course, the devil is in the details. These three steps won't eliminate all problems. But when you have a structured, documented onboarding process, you'll find it much easier to plug holes than you would if you were flying by the seat of your pants with every new supplier.

There must be a real commitment to collaboration on both sides to collaborate. The retailer must be willing to help the supplier instead of surprising them with a "gotcha" chargeback after the fact. The supplier must be willing to use the education and compliance materials provided by the retailer to fulfill orders correctly and fix problems instead of accepting chargebacks as a cost of doing business. Fortunately, we've seen both sides take a more active interest in collaboration and becoming better trading partners. It all starts with effective onboarding.

Are you struggling to develop the right formula for successful onboarding? If you have an effective program, what tips can you share to help other members? Ask questions and share insights during our retailer open forum conference calls and continue the conversation on the RVCF forum boards. Let's work together to improve onboarding across the industry, prevent compliance issues, and make sure customers get the right product, at the right place, at the right time.

CLICK HERE to return to the MARCH 2016 RVCF LINK

Tags:  Onboarding 

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3 Key Components to Successful Supplier Onboarding, Part 2

Posted By Administration, Thursday, February 11, 2016
Updated: Tuesday, February 9, 2016


In the January 2016 edition of RVCF Link, we began to outline the three steps in the supplier onboarding process. Effective onboarding is essential to a successful and profitable retailer-supplier relationship, but few retailers have mastered this process. We know this is true because questions about how to improve supplier onboarding are part of our retailer-only open forum conference calls every month.

Last month, we discussed the first step of successful supplier onboarding – a thorough setup process within the retail organization. This involves identifying a person to take ownership of the setup process, collecting information required to begin the onboarding process, creating an integrated database to house this information, and maintaining this database to ensure all information is accurate and up to a date.

Once the setup process is complete, the retailer moves to the second component of successful supplier onboarding – the education of the supplier and validation of the supplier's supply chain capabilities. Most retailers do business differently, so it is incumbent upon the retailer to make sure their specific compliance requirements are explained to the supplier. In a perfect world, the retailer would simply hand the supplier a compliance guide and a scorecard, the supplier would always do a great job, and everyone would high-five each other and live happily ever after.

Unfortunately, the more common reality is that the retailer's educational and validation processes are inadequate. The supplier makes mistakes because they don't understand the retailer's requirements, or the supplier is incapable of fulfilling orders in a certain way. Chargebacks are then issued for compliance violations and friction builds in the relationship.

The retailer should have documentation that explains their way of doing business. This documentation is usually called the retailer's standards. We've found that self-paced learning tools tend to deliver the best results. Retailer standards and training materials are often made available to suppliers through a portal. Otherwise, an e-mail sent to the supplier will instruct them to review training manuals, PowerPoint presentations, videos or other content that explain what the retailer requirements are and how they should be met.

This is how an order should be processed. This is how merchandise should be packaged. This is how product should be labeled. This is where price tickets should be attached. This is the kind of hanger that should be used for this type of garment. All of the little details required to deliver a perfect order to the retailer must be clearly and completely explained and illustrated.

Retailers that are serious about improving their onboarding process are trying to build more muscle in this area. They're working on better documentation and more dynamic training materials with graphics and video. They're doing more to ensure that the right people within the supplier organization find out what they need to know. They're encouraging questions about compliance requirements so the supplier can hit the ground running. Otherwise, some suppliers will fill orders the same way they do for other retailers and hope it's correct.

As a result, there should be a lot of communication between vendor relations and the supplier. In addition to the details mentioned previously, they need to set up the EDI relationship. They need to validate EDI formatting to make sure both sides can communicate through EDI, determine which documents will be used and how they will be structured, and test the transmission of information.

This critical second phase of the onboarding process is all about education and collaboration. This is the stage in which all of the boxes must be checked to ensure each side understands the other side's expectations. This is the stage that will determine if compliance will be a problem – before an order is ever placed.

As important as it is for the retailer to shoulder the burden of educating the supplier, the supplier must be honest about their capabilities. If a certain requirement cannot be met, or they handle a certain process differently, this is the time to put those issues on the table. In most cases, the retailer isn't looking to make adjustments at this stage of the game, so they'll typically urge the supplier to either change their process or make the necessary investments that allow them to meet the retailer's requirements. However, the retailer should be flexible when appropriate and provide guidance so compliance requirements can be met as painlessly as possible.

Once the retailer and supplier are on the same page, the retailer sends their first order to the supplier, the supplier ships the first order, and the retailer reviews the first order. These three "firsts" – the first purchase order, the first shipment, and the first receiving – require oversight and follow-up. This phase of the supplier onboarding process will be covered next month in the third and final part of our series.

CLICK HERE to return to the FEBRUARY 2016 RVCF LINK

Tags:  Onboarding 

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3 Key Components to Successful Supplier Onboarding, Part 1

Posted By Administration, Thursday, January 14, 2016
Updated: Wednesday, January 13, 2016


Every month, we at Retail Value Chain Federation (RVCF) host our retailer-only open forum conference calls in which retailers can collaborate and share ideas for solving compliance issues. And every month without fail, a question is asked about supplier onboarding because every retailer understands that many compliance issues wouldn't exist if the retailer had done a better job of onboarding.

Major retailers are already working with most of the major brands. If retailers only had to onboard large suppliers a few times per year, it would be a relatively easy job. However, most onboarding involves suppliers that are either small or still in their infancy, trying to figure out how to manage their own growth.

These suppliers haven't yet made the investments in people, processes and systems. In most cases, they've only worked with a handful of smaller retailers that don't have nearly as many requirements as major retailers. Without a comprehensive, collaborative onboarding process, a rocky road filled with chargebacks, disputes and unhappy customers typically lies ahead.

Effective supplier onboarding is essential, not only because it helps to reduce compliance issues, but because it sets the tone for a smooth retailer-supplier relationship. The relationship will be much more amicable and profitable if retailers make the necessary internal preparations and take an active interest in collaborating with suppliers and setting them up to succeed. Similarly, suppliers must be responsive to the needs of the retailer and do everything possible to meet retailer requirements.

RVCF, in collaboration with our retailer membership, has identified three key components of successful supplier onboarding. Because onboarding is such a critical process and a regular topic of discussion in our monthly conference calls, we wanted to dig deeper into each of these areas in a three-part series of articles.

In this article, we'll focus on step one – a thorough setup process within the retail organization.
First, the retailer needs to have someone take ownership of the process, which can vary somewhat from retailer to retailer depending on their systems and processes. This point person will bring together key personnel and get internal alignment with regards to what exactly needs to be done to begin the onboarding process with the supplier. This involves creating a checklist that lays out what information needs to be collected, how this information should be collected, and who should be responsible for collecting various pieces of information.

Once information has been collected, create a single database that houses all of the information for the various departments involved in the onboarding process. For example, the merchants need information from the supplier so the buying organization can move forward with setting up orders according to agreed-upon terms and conditions. Accounting needs to know these terms and conditions and ensure that the supplier is paid according to those terms. Buyers, accounting and the supplier need to be in lockstep with payment terms, chargebacks, discounts and other financial issues.

The inventory team needs to be clear about what the retailer will be buying from the supplier, how much, and how frequently. Will the retailer be buying from one location or multiple distribution centers? This is also relevant to the supply chain folks, who will have oversight into the routing and logistics behind the movement of inventory from the supplier. Will merchandise be coming from an overseas distribution center? Will it be shipped to a distribution center or directly to stores?

It is the responsibility of vendor relations (or vendor compliance) to manage the gathering of information, maintain the database, and keep everyone on task and on time. For some retailers, vendor relations exists within the supply chain group or the merchant group. Once the retailer knows what needs to be done and how to do it, and all of this knowledge and data has been collected, vendor relations begins the second component of successful supplier onboarding – the education of the supplier and the validation of supplier capabilities.

We'll discuss this in detail in next month's issue of the RVCF Link newsletter. In the meantime, we encourage you to participate in our retailer open forum conference calls and discuss onboarding problems and solutions. Continue the conversation on the RVCF forum boards. Tell us what you want us to cover in upcoming webinars and at RVCF conferences. Most importantly, start having internal conversations about what steps your retail organization can take to prevent compliance issues by improving its onboarding process.

CLICK HERE to return to the JANUARY 2016 RVCF LINK

Tags:  Onboarding 

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Better Onboarding Is a Path to Better Supplier Performance

Posted By Administration, Thursday, June 11, 2015
Updated: Tuesday, June 9, 2015


Large retailers are constantly looking for new suppliers who have new and unique products that aren't carried by competitors. At the same time, young suppliers are eager to get their products into the stores of major retailers. Over the course of a year, large retailers, especially major department stores and apparel retailers, may onboard 100 or more suppliers.

These retailers typically have a robust supply chain operation, with dedicated supply chain teams, sophisticated software and infrastructure, and solid compliance programs and performance metrics. On the other hand, most of the suppliers being onboarded are relatively small and haven't yet made these investments.

In most cases, the retailer wants a supplier that's not quite ready for prime time. They send a glorified owner's manual to get the supplier up to speed and they say they'll work closely with the supplier at first to track and review orders. However, they simply don't have the manpower to parachute in and help every supplier.

Even though the supplier knows they're not ready for prime time, they want to be that retailer's trading partner. The supplier promises to do a good job and works hard, but their supply chain lacks the people, processes and systems required to meet retailer requirements.

The supplier ships orders, makes mistakes, and gets hit with chargebacks from the retailer. This becomes the less-than-ideal status quo. Despite the repeated chargebacks, supplier performance isn't improving significantly. The retailer isn't happy and the supplier isn't happy.

Of course, there's an ugly little reality out there in the supplier community.

The supplier looks at the complex requirements imposed upon them by retailers, who want packing, ticketing, labeling and other details handled in ways that aren't standard for the supplier. The supplier determines it's not worth it to change their shipping processes. When they're hit with a chargeback, they decide to just pay the fee and work that cost into their P&L in such a way that makes it manageable.

Does this story sound familiar?

There is no single solution to improving supplier performance. But if retailers are onboarding 100 or suppliers the same way every year and not seeing significant improvements in supply chain performance, retailers need to reevaluate their approach to onboarding.

We believe retailers need to get tougher and more supportive at the same time.

They can get tougher by recognizing that not all suppliers are equally valuable. That's just the cold, hard reality. Retailers need to focus their attention on the most valuable suppliers that have products that are truly unique and sell well.

Retailers can become more supportive by investing in the onboarding and supply chain performance of their most valuable suppliers. Instead of giving them a scorecard, complaining about performance, hitting them with chargebacks when they perform poorly, and wondering if they've built that cost into their cost of goods, they can get actively involved in the onboarding process. This may require retailers to hire a few people to take a more hands-on approach with new suppliers.

Visit that supplier. Go to their shipping floor. Talk to their shipping manager. Be a consultant and a teacher. Rather than giving suppliers 100 pages of text with a handful of diagrams, provide them with rich PowerPoint presentations and video instruction that are easier to understand and more accessible.

Chargebacks alone aren't bringing the kinds of improvement retailers need. Some retailers believe the only way to bring more focus and attention to their requirements is to be more punitive and raise their chargebacks. The retailers who are doing this have yet to confirm that this approach is effective.

Based on our conversations with retailers and comments during recent retailer only forums, retailers admit that they haven't invested enough in their onboarding process. Resources and budgets have been focused on compliance and scorecard programs, inventory management, e-commerce, omni-channel and other front burner issues. These are considered critical to remain competitive and deliver a seamless customer experience across all shopping channels. Although onboarding is a problem, it's not necessarily a priority.

Most retailers also don't have a sophisticated, web-based portal for quickly exchanging information with suppliers. In fact, while suppliers are waiting to find out what they did wrong and why they were penalized, they continue to make the same mistakes with future shipments and get hit with the same chargebacks. Deploying such a portal is major capital expense.

Generally speaking, retailers recognize the onboarding problem and how it relates to supplier performance, which is directly tied to two very important things – the financial performance of the retailer and the satisfaction of the consumer, who expects to get the product they want, where they want it, when they want it.

  • Retailers should look at their onboarding process and ask the following questions.
  • How sophisticated is your onboarding process in terms of people, process and systems?
  • Is your onboarding process as supportive as it could be?
  • Are your training materials as helpful as they could be?
  • Are you taking a one-size-fits all approach to onboarding all new suppliers?
  • What enhancements would improve onboarding and supplier performance?
  • Is it time to make onboarding a front burner issue?

We want to hear what you have to say. We invite retailers to participate in our next retailers only open forum conference call, a free monthly conference call modeled after the popular open forum sessions held at RVCF conferences. We also encourage you to share your inquiries and feedback on the RVCF forum boards regarding the challenges of onboarding and how it impacts supplier performance.

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Tags:  Onboarding 

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Ask a 3PL Expert: We Chose a 3PL – What Next?

Posted By Administration, Thursday, April 9, 2015
Updated: Wednesday, April 8, 2015

by Scott Weiss, Port Logistics Group

Advice on routing guide compliance, 3PL relationships, and domestic logistics topics creating supply chain challenges for your organization. If you have a question or challenge that you just can't solve, please send your questions to

After a lengthy RFP process, our company has selected a new logistics provider for our Southern California warehouse and order fulfillment needs. What should we keep in mind when we bring the new 3PL on-board?

- Javier, Clifton New Jersey

Congratulations on your selection, but now the real work begins. All too often, we see 3PL users send out only quantitative data to the potential 3PL and just focus their decision on the rates. The adage that “the most important things in the contract are not in the contract” really applies at this stage of the decision making process and prior to signing the agreement. You must have a very high comfort level with the 3PL's ability to ensure a sound and methodical implementation.

One of the main components in achieving a successful start-up and implementation is a focus on planning and execution. Your chosen 3PL must be able to commit the necessary resources in engineering, technology, and operational expertise to implement a solution that exceeds your requirements for a successful operation without service interruption to customers. But this goes both ways. Your organization must also be able to commit the necessary point person, IT support, and operational resources to support the start-up.

The implementation process can be best summarized by 3 unique phases:

  1. Project Phase
  2. Programming Phase
  3. Deployment Phase

A disciplined approach to all new account implementations using a 5-step process based on Six Sigma principle is recommended:

  • Define – map current process and desired future state
  • Measure – determine baseline metrics that are important to you
  • Analyze – review IT, operations touch points
  • Design – build process flows and SOP's
  • Verify – system testing, parallel testing prior to implementation

A 90-day implementation is recommended; however, in the real world an implementation can be as quick as 30 days or as long as 180 days – 30 days if an organization has to leave their current 3PL due to circumstances beyond their control (an example would be when a 3PL goes bankrupt and closes its doors) and 180 days when the customer's resources are at a premium and they require a longer implementation process.

Project Phase
The project phase outlines the objectives and expectations of the implementation.

Project Phase Key Events

  1. Gather & Assess
  2. Data Collection
  3. Create Preliminary Project Plan
  4. Project Roles & Responsibilities
  5. Project Team
  6. Communication Plan

The key elements of this approach are:

  • Have the 3PL provide a high-level project manager to manage the implementation, ensuring resources are provided, time line is established and met, and issues are quickly resolved. It is absolutely critical that you have a high-level project manager assigned from your organization that will have the operational knowledge, organizational skills, follow-up skills, and authority to drive internally resources required to support the implementation
  • Identify an executive, inter-company steering committee to provide strategy and issue resolution. This will typically include an executive sponsor from your organization along with key managers from your operations, IT, customer service teams. The 3PL must do the same.
  • Assign inter-company cross-functional implementation teams.
  • Hold weekly implementation meetings with the 3PL. The 3PL project leader should lead these weekly calls. Typically the calls will range from 30 to 60 minutes every week.
  • Hold weekly IT specific calls that focus on system integration, testing, and routing compliance documents. • Develop, publish, and maintain a detailed project task list, timeline, GANTT chart, and critical path. Again, this should be updated and published every week by the 3PL and prior to the weekly call.
  • Discuss and resolve issues quickly, involving all of the right key stakeholders.

Programming Phase
Systems integration is a critical component to a successful implementation. The 3PL information technology team must be experienced in rapidly linking their WMS to various client ERP's and/or legacy order management systems. There are a variety of methods to process customers' orders, each uniquely tailored to clients' needs. Common formats include AS2, FTP, and EDI. Various formats can be used to transmit files to the 3PL including csv files, flat files, EDI, and XML, so you need to make sure your 3PL can accept your file formats. Prior to the implementation beginning, an IT specific kick-off call should take place that makes sure the organizations will be able to communicate with each other electronically.

Programming Phase Key Events

  1. File Interfaces
  2. Receiving
  3. Picking, Pack & Ship
  4. Reporting
  5. Testing
  6. Install & Configure
  7. Data Set-up and Data Loading
  8. Execute Training Program

Deployment Phase
You are now ready to go live. During the implementation and deployment phase, you should work with your 3PL to define critical business and operational requirements and establish agreed upon key metrics and performance goals. All activity should be easily tracked through the WMS and Key Performance Indicators (KPI's) and performance goals should be reviewed weekly, monthly, and during Quarterly Business Reviews (QBR's).

Deployment Phase Key Events

  1. Data Conversion
  2. IT Support
  3. Go Live
  4. Project Transition
  5. Helpdesk
  6. Outstanding Issues

As Vice President, Business Development, Scott Weiss works closely with apparel, footwear, and housewares manufacturers of all sizes to ensure compliance with retailer routing guide requirements.  Port Logistics Group is a market leader in gateway port logistics services, operating over 5 million square feet of warehouse space.  Services include port drayage, import deconsolidation, warehousing and distribution, retail compliance, local transportation, and store delivery in key port locations of Los Angeles/Long Beach, New York/New Jersey, Seattle, and Savannah.  Scott may be reached at or (562) 977-7620.

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Tags:  3PL  Onboarding 

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