Walmart SQEP & What Suppliers Need to Know

What is Walmart SQEP?

SQEP, or the “Supplier Quality Excellence Program,” was rolled out in early 2021. Walmart’s SQEP is an initiative committed to enhancing supply chain efficiency. Its primary objectives are to boost end-to-end precision, slash operational expenses, and consistently stride toward excellence. SQEP encompasses four key areas:

• Purchase Order (PO) Accuracy (ensuring the Right Item and Correct Invoice),
• Barcode and Labeling Compliance (ensuring the Right Item in the Right Condition),
• Packaging, Pallet, and Load Compliance, and
• Scheduling and Transportation Compliance.

Why is Walmart SQEP Important?

Any defect, whether in cases, pallets, or transportation, can hinder the smooth operation of Walmart’s network. Especially with recent supply chain disruptions and stock shortages, Walmart emphasizes catering to their customers—guaranteeing their needs are met both in-store and online. Their mission revolves around the “four rights”: Right Item, Correct Invoice, Optimal Condition, and Precise Timing. Suppliers that align with these principles ensure a seamless shopping experience at Walmart’s store fronts.

What Happens If Suppliers Don’t Adhere To Walmart’s SQEP Standards?

Walmart envisions the “perfect” trailer: an order free of defects, allowing for optimal processing efficiency. Suppliers are expected to align with SQEP’s criteria. Any deviations from the outlined guidelines lead to a $200 penalty per PO, with an additional $1 charge for every affected case within that PO. Separate from this, ASNs (Advance Shipping Notices) lacking proper attachment incur a $25 penalty per PO. Any discrepancies between the received goods and the ASN, while not currently fined, are projected to face penalties in the near future—estimated at $0.25 per case.

How Can Suppliers Avoid SQEP Penalties?

1. Finalize the ASN configuration, either via your EDI provider or, for those in the consolidation network, through your consolidator.
2. Ensure your labels conform to the Supply Chain Packaging Guidelines. Existing suppliers can leverage the three tools provided by Walmart to aid in SQEP alignment.
3. Prioritize PO accuracy: dispatch the correct product, with appropriate labels, punctually. Cultivate internal protocols that guarantee consistent and accurate deliveries.

How Does OCM Support Suppliers With SQEP

At OCM, we constantly adapt to Walmart’s evolving landscape and prioritize their latest initiatives. With the introduction of SQEP, we immersed ourselves in its intricacies, allowing you to focus on your core business without having to worryabout the minute details of compliance. We offer comprehensive communication on any element that might influence your operations and we guide you through best practices for ASN transmission and barcode formatting.