When a customer places an order for a partner-fulfilled item on Walmart.com, Walmart uses an algorithm that chooses the best Drop Ship Vendor (DSV) to ship the order based on the partner location, inventory, and delivery location to ensure the best possible experience for the customer. This information is also used to assign an Estimated Ship Date (ESD) to each order. DSVs are required to ship on or before the ESD to meet the promised delivery date. Failure to comply with this date will result in a fulfillment Performance (Late and Reject) Chargeback and may result in suspension from the DSV program.

The Walmart Performance Management team applies two types of chargebacks.

• Late Chargebacks – Calculated based on the number of POs shipped past the ESD, with an allowance of 1% of the total number of POs shipped in a chargeback period. A charge of $5 is applied to each late PO over this allowance. 
• Reject Chargebacks – Calculated by the number of units rejected with backorder or discontinued status, with an allowance is 0.1% of the total number of units shipped in the chargeback period. A charge of $5 is applied to each rejected unit.

DSV Supplier Agreement – Section 3 Fulfillment

The terms of the standard DSV contract outline the standards that Walmart has set for shipping POs. The following bullet points provide the text from your DSV contract for Late Shipment and Backorder issues. 

• Late Shipment – Supplier shall maintain an on time ship standard of at least 99% (On Time Ship Standard). The On Time Ship Standard shall be calculated on a calendar monthly basis. The On Time Ship Standard shall consist of (1) Supplier tendering at least 99% of Walmart.com customer orders to the delivering carrier on or before the Estimated Ship Date (ESD). ESD means the Standard ESD Time, including complete and accurate tracking information within the ESD; and (2) Supplier shipping the remaining 1% (or other remaining percentage) of Walmart.com customer orders no later than one (1) Business Day following the expiration of the ESD and communicating to Walmart.com in the Company Format accurate ship status of such customer orders, including complete and accurate tracking information as provided by the carrier.
• Backorder – Supplier shall maintain inventory to fulfill Walmart.com customer orders at a rate that results in no more than .1% backorders (Backorder Percentage). Supplier shall accurately ship the correct merchandise to the correct recipient (Order Accuracy) at a rate of 99.9% of Walmart.com customer orders. The Backorder Percentage and Order Accuracy shall be calculated on a monthly basis.

Chargeback Impact on DSVs

All DSV orders are shipped on behalf of Walmart.com. Late shipments or backorders can affect the integrity of the service-level agreement (SLA) and the promised delivery date to the customer, which can result in negative customer experiences. Chargebacks are to remind suppliers to adhere to order ESDs to provide the best possible experience for the Walmart customer. 

Avoid Fulfillment Chargebacks

Follow the instructions and best practices below to reduce the instances of chargebacks on your DSV account. 

Avoid Late Chargebacks

POs shipped after an ESD will be considered late and will result in poor customer experience and may result in your order being auto-canceled. To avoid late chargebacks, check Supplier One Order Management regularly (at least once a day) to avoid overlooking orders that have a ship date that is about to lapse.  

• If the item's in the order ship LTL/Freight, create a case for Partner Support to set up LTL carrier methods.
• Walmart must receive shipping confirmation when the orders are picked up by the carrier.
• Work with local carrier hubs to verify that their orders are picked up and scanned the same day.
• Lead (lag) times are only granted for custom-made, built-to-order, or large freight items. If your items fall in any of these categories, click Help > Manage tickets in Supplier One to request lead time. You can review Fulfillment Lag Time for additional details and requirements. 
• The default daily order cut-off is 12:00 p.m. local warehouse time. The cut-off time to be eligible for the 2-day program is 2:00 p.m. local time.
• If you fall behind in shipping your orders, consider setting an operational outage in Supplier One to give you time to catch up. Please note setting an operational outage pushes out the ESD for future orders, it does not stop orders from coming in. Any orders received before the outage is set will have with the original ESD. 

Avoid Reject Chargebacks

Chargebacks for rejections are applied when the vendor rejects a PO by updating an order status to Backorder. To avoid reject chargebacks, you must submit accurate inventory feeds on a regular basis to avoid receiving orders for items that are out of stock.

• For any issues with an item SKU, cost discrepancies, or address issues: Set the PO status to Unrecognized and create a ticket to report the issue (click Help > Manage tickets in Supplier One). Select the option that best describes your issue.

Chargeback Schedule

Performance Management sends chargeback emails on a monthly basis.

• You have until the end of the month to review your charges.
• All dispute deadlines are provided in the chargeback emails.
• All defective POs will be provided in the PO details file attached to the scorecard.

The table below illustrates when chargebacks from the Chargeback Month column will be visible by providing the date of the scorecard release in the DSV Scorecard Available column.

Dispute a Chargeback

If your business has a valid business reason to be exempt from a Late or Reject Chargeback for a month, you must submit an exemption request to the Walmart Performance Team. All requests are subject to approval.

If you would like to dispute any late shipments or reject chargebacks, click Help > Manage tickets in Supplier One. Choose Payments as the issue type. 

You must fill out the fields provided accurately so the Partner Support team can assist with your dispute. The fields include: 

• Description - A detailed description of your issue to help the support agent resolve your case.
• Category - Choose the issue category from the dropdown provided. 
  • Both Late & Reject Chargebacks
  • Late Chargebacks
  • Reject Chargebacks
  • Contacts Update
• Months Disputing - Choose the months for which you have disputes from the dropdown. You select more than one month at a time. A check mark appears to the left of the chosen months. 
• Chargeback Type - Choose the chargeback type that you're disputing. You can only choose one option from this list. Be sure that you're only submitting one dispute ticket per Chargeback type. 
  • Late - ASN Scan or On Time Shipped Issue
  • Late - Carrier Missed Picked or Scan Delay Issue
  • Late - Cutoff Time Issue
  • Late - Preorders
  • Late - Holiday, Warehouse Closure, inclement weather
  • Late - Wrong Lead Time Rejection - Inventory Issues
  • Rejection - All Other Reject Issues
• Upload Files - Include any attachments (e.g., examples of chargeback emails received) that support your case should be attached to the case after you select 

Payment Questions

If you have any questions or concerns regarding carrier claims or payments that are not chargeback related, please submit a ticket to Walmart Global Shared Services (GSS).