Walmart.com has long been an extension of the popular brick-and-mortar Walmart stores, but it wasn’t until 2009 that the Walmart Marketplace launched. Since then, Walmart’s online sales have grown to $152.3 billion in 1Q2023, ranking No. 2 in the Top 1000 database for online sales, behind only Amazon. Walmart DSV is one of the programs developed by Walmart to allow approved suppliers to sell through their marketplace. In this article, I will go over the complexities of the Walmart DSV program and its pros and cons so that you can decide if the program is for you.
What is Walmart DSV program?
Walmart DSV (Drop Site Vendor) is the program that Walmart offers to registered suppliers to sell products through Walrmat.com. In this program, the supplier sells its products directly to Walmart at wholesale prices and ships directly to the customer or physical Walmart stores with Site to Store. Under this program, the inventory belongs to the DSV, which is also responsible for having the agreed stock. Walmart is responsible for serving and delivering the order to the user rests with Walmart.
What are Walmart’s requirements to allow a DSV?
- Have Walmart ID.
- Have approved products been approved. It is important to note that Walmart focuses on approving high-volume products, prices over $10, and margins between 30% and 40%.
- Be approved as DSV.
- Create the DSV product catalog following Walmart’s directives
DSV Process Description
The figures shows how the DSV program works, once you comply with the requirements outlined above.
DSV responsibilities under the program
DSVs must meet the following program requirements. Failure to comply may result in account suspension or termination.
Order Dispatch: Orders must be delivered by the respective Expected Shipment Date (ESD) and before the end of the carrier’s pick-up.
Dispatch Charges: Walmart pays for shipping, but DSD is responsible for any costs associated with delivery to the carrier.
Dispatcher: The DSV can only ship through the carriers authorized by Walmart: FedEx, UPS, and USPS. The DSV is responsible for contacting the carrier using the Walmart account with the carrier (this information is provided upon acceptance as a DSV), and notify Walmart when the order is delivered to the carrier.
Shipping Address: Orders must be shipped to the address that Walmart.com specified.
Packaging: Orders must be shipped in plain, unbranded boxes or polythene bags, with no packing slips or marketing materials on the packages.
Inventory: The DSV must maintain the inventory levels agreed with Walmart to guarantee delivery on time (OTD). It is mandatory to update the inventory in the portal, at least once a day.
DSV performance measurement
The performance of the DSV is measured by two indicators:
Delivery time: OTD is a performance and efficiency measure that quantifies the number of units delivered to customers relative to the date promised by Walmart. On-time shipping is a component of OTD. Each purchase order is assigned an expected shipping date (ESD) and a timestamp. You must submit each purchase order on or before the ESD date and time for it to be considered on time.
Rejection rate: This indicator measures the number of orders that are not delivered to the user successfully, either because they are defective, returned by the user, undelivered due to lack of stock, or canceled by the system.
Walmart DSV expectations
Advantages of the DSV program for the supplier
Selling through this program has the following positive aspects:
- Wal-Mart covers the shipping freight to the customer. This means that while you are losing margin when selling wholesale, the lack of shipping costs can make up for the losses.
- Access to a very large market under the umbrella of Wal-Mart, which should translate into increased sales, assuming that the products are suitable for this type of channel.
- Products will appear as “Sold and Shipped by Walmart”; which tends to increase page conversion rates.
Disadvantages of Walmart DSV program
Despite the advantages listed in the previous section, there are several drawbacks to using the DSV program.
- Must meet rigorous performance standards, such as a proven track record of excellent customer service and quality products.
- You don’t have much control over product descriptions, retail prices and returns (all returns are settled).
- You are selling wholesale, hoping that the increase in sales, with the free shipping, will make up for the loss in margin.
How Promoting USA can help you to start as DVD
Promoting USA experience and knowledge of how big retail chains work can be instrumental in helping companies gain entry into the Walmart DSD (Drop Ship Vendor) program. If you want to learn more about how we can help you succeed in the US, give us your information to schedule a meeting.
I hope this article on Walmart DSV program has been helpful to you. I will continue to post information related to trade channel management, general economy and market trends. If you are interested in this article or want to learn more about Promoting USA, please subscribe to stay updated on future articles.