Build Business Credit & Partner With Major Retailers

Creating a supplier relationship with Walmart is no walk-in-the-park; don’t make the process harder by neglecting your business credit score.

The competitive nature of the supply chain industry in recent years has allowed retailers to raise their standards when considering a partnership with a supplier; but what if, you, the supplier, had a product, the resources and the business mindset for success, but you were ineligible for partnership with a retailer like Walmart (that could more-than-triple your product’s earnings) because of your business credit history?

Consider this, in 2013 Walmart released a campaign committed to purchasing, “approximately $250 billion in products by 2023 to support the creation of American jobs.” Walmart has been investing in local suppliers and products on a large-scale, which is great news. However, many suppliers don’t have a good understanding of what Walmart is looking for in a candidate, which leaves them in the dark about what they can do to secure and maintain a partnership.

According to the Walmart Supplier Webpage, the first two steps that a supplier should take to be considered for a partnership with Walmart are, 1) Complete the Product Submission forms and 2) Submit your business’s Dun & Bradstreet Credit Reports. Like many retailers, the intent is to both consider the product and the level of risk associated with the business.

A company’s business credit profile provides the retailer with a panoramic view of the business and provides a general overview of the company’s likelihood to deliver as promised. Retailers keep an eye out for even the slightest derogatory marks, the history of on-time or late payments, etc. when evaluating a business credit profile. In addition to reviewing the business credit profile, many retailers use the Supplier Evaluation Risk Rating to predict the statistical probability of failure associated with a potential supplier and manage a minimum threshold policy for their suppliers. This allows retailers to be proactive in the prevention of possible losses and setbacks.

In order to be considered as a supplier for Walmart, your business’s SER score must be below a 7 (scores range from 1-9 with the lowest numerical value being the better score), further, if you are a current partner and your business’s SER score moves from the threshold (1-6 in this case), you will likely become ineligible for partnership.

The SER score minimum threshold requirements for Walmart, like most retailers, serve as a filter to disqualify high risk candidates from moving forward, however, the requirements are guidelines for buyers to follow and an ideal candidate will likely maintain an average score between 4 and 6, and obviously, the lower the better.

Walmart is known for a lot of things, but flexibility among it’s partnerships is not one of them; all suppliers, supplier facilities, subcontracting and packaging facilities are required to adhere to all of Walmart’s guidelines, unless exempted in writing, and if a supplier cannot deliver as promised it can cause a strain in the partnership. Walmart maintains a standard template contract and makes very few exceptions.

As a supplier, it is crucial to put your best foot forward and take the necessary steps to qualify as a candidate and maintain a secure relationship with your retailer. The secret to success is building business credit, which is completely separate from personal credit. If your business does not have a current Dun & Bradstreet rating, you can apply and update your information online or by phone, this process may take up to 30 days. You may also want to consider consulting an expert long before you submit your product application to ensure your credit profile is in the best possible condition and help you maintain good standing; this will make your business appear more creditable and help to develop the line of credit necessary to bridge the gap between accounts payable/receivable.

Revolutionary technology used by firms such as Dun & Bradstreet have provided business owners with quick access to their credit profiles; the days of “cross your fingers and hope your product or line of credit will get approved” are over. Don’t be like so many of the business owners before you that have partnered with large retailers like Walmart, only to find that the supply chain process was halted because of their capital or credit; take advantage of the resources available to you, get educated and make the effort to secure your financial future. If you see inconsistencies in your business credit reports, let us correct your business credit!

North Shore Advisory offers two business credit building programs – A Do-it-Yourself Program through our website NationalBizCredit.com and a Concierge Program that is done in-house by our team of Credit Experts. We also offer a Business Credit Repair program for companies with established profiles who need damaging information removed. We will customize our services to fit the needs of your unique business. Reach out to us today for a free consultation.