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Leading media outlets have recognized the insights Harvest Revenue Group offers about the retail industry. Company president Boyd Evert has been quoted in The Wall Street Journal and Arkansas Democrat-Gazette, among others. Boyd also regularly publishes commentary and insights on his Linked In page. Relevant articles and commentary are published below.
 
Michael Tilley, Host
Talk Business & Politics
9/6/2017

Suppliers began facing new “On Time In Full” (OTIF) delivery requirements to Walmart last month and are now facing some stiff fines when merchandise doesn’t arrive when the retailer expects it. As part of its ongoing “Supply Side” video series, Harvest Revenue Group President Boyd Evert joined Talk Business & Politics host Michael Tilley to discuss some of the challenges of dealing with Walmart amid a growing number of cost shifts, including: how Walmart may deal with OTIF following major hurricanes; how suppliers should be alert to store-level defective merchandise trends especially in the hurricane impact zones; and an increased vulnerability to margin audits facing suppliers.



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By Boyd Evert
President, Harvest Revenue Group
LinkedIn Pulse
8/9/2017

Regardless of the size of the business, aligning vision and execution between all areas of the enterprise is a challenge. If you’re the size of Walmart, it is all the more so. For months, Walmart has been sounding the bell that “August is coming,” urging its suppliers to be ready for “On Time In Full” (OTIF) requirements or face yet another round of additional costs and penalties from the behemoth retailer. But not only do suppliers face the financial challenges that come with the program, they also face the reality that Walmart is implementing something that almost no-one – perhaps including those inside Walmart – understands.

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By Walter Loeb, Contributor
Forbes.com
6/6/2017

Walmart has two great e-commerce sites: Walmart.com and Jet.com… The sites are competing with Amazon and the rest of the online merchants. Price and assortment are critical to being competitive in internet retailing… The challenge for Walmart is to protect its margins, especially since most items in stores will be price matched with internet offerings. Walmart prides itself on offering very low prices on all merchandise…

According to a white paper published by the Harvest Revenue Group, Walmart has been pushing its suppliers to help underwrite the most recent price-perception effort with lower upfront prices, in some cases 15% lower… The rapid growth of online sales – which is now in the cards – will mean a further squeeze on margins for Walmart and its suppliers. There is no relief in sight given the fierce competition on the internet is not likely to subside.

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By Kim Souza
Northwest Arkansas Business Journal / Talk Business & Politics
5/30/2017

The low cost mission of Wal-Mart is similar to that of Jet.com, and the recent purchase of Jet by Wal-Mart could spell audit trouble for suppliers who have done business with both. A new report from Bentonville-based Harvest Revenue Group outlines several risks for suppliers now that Wal-Mart knows the price Jet paid suppliers for like products.

Harvest Revenue President Boyd Evert, told Talk Business & Politics the suppliers facing the biggest audit risks could be those companies that have used distributors to unload remnant products at closeout prices… He said anytime Jet got a better price for an item than Wal-Mart, an auditor will be likely to write a claim for the difference. Given the number of stores Wal-Mart has and the amount of volume it sells that could be a huge dent to suppliers’ accounts in the form of chargebacks.

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By Boyd Evert
President, Harvest Revenue Group
LinkedIn Pulse
5/30/2017

Walmart’s ecommerce division is on a tear… But, there is a specter lurking in the ecommerce environment following Walmart’s $3.3 billion acquisition of Jet.com last year. While the move has installed new leadership and jump started the digital engine for the enterprise, it is a move that we believe is a cause for concern for suppliers whose merchandise is or was sold in both channels.

In a new white paper entitled “Walmart and Jet: The Hidden Audit Risk for Suppliers”, Harvest Revenue Group explores how bringing together these diverse approaches to retail may have a negative effect on suppliers’ bottom line. Once competitors, Walmart now has access to all of Jet.com’s purchasing information. Because of requirements in Walmart’s supplier agreement, it will bill suppliers back for the difference if it discovers another company purchased the same items for a lower cost than was extended to Walmart.

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By Boyd Evert
President, Harvest Revenue Group
LinkedIn Pulse
2/27/2017

A Reuters article out today (2/27/2017) details another round of aggressive price cutting by Walmart. The piece notes the retailer is running a 1,200 store test in 11 states in the central and southeastern sections of the country. It appears the price push is largely grocery-centric in an attempt to regain price leadership against the likes of Aldi and, to a lesser extent, Kroger. There is no doubt some sharpening of prices taking place as well with German discount retailer Lidl opening its first stores in the U.S. later this year. So, who underwrites the cost of the price cuts? Sources tell Reuters Walmart has demanded suppliers reduce their cost of goods sold to the retailer by 15 percent and that suppliers are expected to “help the company beat rivals on head-to-head pricing 80 percent of the time.”…

We are extremely concerned that this new price push sets the stage for suppliers to not only be asked to pay up front, but also on the back end. With pricing differentials varying by state, or even by market, we can easily see a scenario where a third party audit firm looks at the lower price and makes a claim based on margin and/or adjusts Walmart’s costs downward because of a lower retail price.

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By Boyd Evert
President, Harvest Revenue Group
SupplierLife.com
2/15/2017

It’s a realization of a dream, for many: a product on the shelves of Walmart. With its nearly 6,000 points of distribution in the U.S., including its Sam’s Club division, it’s easy to become overwhelmed through the process. There’s so much to do on the front end to get things into the stores that things that happen on the back end can be easily overlooked – and also very costly. It’s important to educate yourself on what’s in your terms and conditions. The T&C documents are written heavily in the retailers’ favor and may put you on the hook for various allowances and return provisions which can deplete your margins and jeopardize your profitability.

Retailers have become much more aggressive in pursuing deductions against their suppliers in recent years. Sometimes years after the sale, you’ll be asked to pay back money the retailer thinks it’s entitled to. Depending on the amount, they may just take the money and it’s up to you to prove you’re in the right to get it back. Walmart, for example, can claw back up to $100,000, no questions asked.

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By Boyd Evert
President, Harvest Revenue Group
Northwest Arkansas Business Journal / Talk Business & Politics
1/23/2017

Walmart touches every aspect of our region in a positive way — directly or indirectly employing tens of thousands of people in Northwest Arkansas and generously supporting causes that strengthen our communities. But as their mantra is “how do we do better” next year, I offer these suggestions… In recent months, we’ve noticed some trends regarding defectives that cause us some concern.

  • Double dipping
  • Discarded merchandise as defective
  • Damaged at Store; not defective
Walmart seems to define defective as anything that makes merchandise unsaleable then charges it back to suppliers. If damage was caused by shoppers or store associates, how is that the supplier’s responsibility? …

I suggest Walmart adopt these New Year’s resolutions.

  • Play fair. Apply the same standards you have for suppliers to Walmart itself.
  • Be true to Walmart’s original culture. Own up to mistakes and quickly make things right.
  • Rebuild relationships. Recent policy changes have driven a wedge between suppliers and their buyers.


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By Kim Souza
Northwest Arkansas Business Journal / Talk Business & Politics
12/8/2016

Early indications by Walmart U.S. and much of the retail sector through Black Friday indicate strong holiday sales which benefit retailers and suppliers. But it can also create payment conflict between retailers and suppliers. The hefty promotions offered through the holiday season can set the stage for post-audit claims in the coming months, according to Boyd Evert, president of Harvest Revenue Group in Bentonville…

The promotions for the recent Black Friday event were negotiated as far back as February, he said. There are many emails exchanged, and promotional funds paid to retailers in advance for things like advertising and high profile shelf space. He said the suggested retail sales price and the cost are typically set forth in the early negotiations. But, during the holiday rush and perhaps subsequent markdowns, Evert said suppliers can find themselves with post-audit claims and having to renegotiate the suggested retail price months later when (third party) auditors have written claims based on new assumptions.

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By Boyd Evert
President, Harvest Revenue Group
LinkedIn Pulse
11/28/2016

As many retailers – including Walmart, Target, Best Buy, CVS, Amazon and Kroger – conclude their fiscal years in December and January, auditors will be looking carefully at emails, invoices and terms and conditions for any edge they can find to wring more money out of a promotion… Unfortunately, post audit is becoming more and more of a profit center. Retailers have employed third-party firms for decades to look at deal sheets and make sure they got what was promised. Today, these audit firms openly advertise for “creativity to help generate new ideas for claim concepts.” Often, it’s not about the spirit of the deal. It’s about the bottom line… With that in mind, here are three quick tips to help you avoid post audit claims – they make great New Year’s resolutions:

1. Make sure you capture all correspondence between your company and the retailer.
2. Be detailed in your communications with retailers.
3. Follow up on loose ends.

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By Boyd Evert
President, Harvest Revenue Group
LinkedIn Pulse
11/3/2016

The Kroger Co. now sits atop the leaderboard of retailers, tied with Walmart, in the Kantar Retailer PoweRanking™ released on Tuesday. A Kroger news release notes it’s the first time in 20 years it has attained the top spot on the list, ranking first in “best retailer to do business with” and “best buying teams,” among other categories...

While the results show a clear and strong level of support and appreciation for Walmart, the largest customer of many of the respondents, it’s also telling that the perceptions of Walmart are shifting…This year, there is a growing uneasiness within the supplier community about “On-Time In Full” delivery requirements that are beginning to be rolled out. We’re hearing there may be larger asks regarding defective allowances. And, Walmart is again asking suppliers for even lower prices, even as the cost of doing business with Walmart has continued to increase.

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By Boyd Evert
President, Harvest Revenue Group
LinkedIn Pulse
10/3/2016

The Wall Street analyst community comes to Bentonville on Thursday for meetings with top Walmart executives and, it’s reasonable to expect some details of what challenges may be in store for suppliers to come to light this week. One area where changes appear imminent is in MABD, with delivery windows shrinking to as little as one day. In analyzing data from the clients Harvest Revenue Group works with, 37 percent of trailers dropped at a non-grocery Walmart DC sit on the yard for three or more days. Only one in 10 trailers is received on the day it arrives. This is an area ripe for claims made against suppliers, requiring more manpower to research and dispute them.

Merger news is receiving a good bit of attention in recent days. In the case of Walgreen’s and Rite Aid, with 500-1,000 stores possibly closing, suppliers can expect a spike in their markdowns coming. But the longer-lasting, deeper impact to the bottom line of retail mergers may be in the terms and conditions agreements suppliers have with each company. We have seen in the past, corporate and third-party auditors will examine both sets of T&Cs carefully and apply whatever suits them best. As a result, suppliers should be prepared for greater audit exposure, especially in the post-audit space. We recommend suppliers compare their agreements with each of the merging companies now and identify any differences in T&C that can be used as leverage against their financial position.

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By Boyd Evert
President, Harvest Revenue Group
LinkedIn Pulse
8/18/2016

Walmart's solid 2Q earnings report provided some welcome news for investors...but hidden in the numbers was how money extracted from the company's suppliers has shored up the bottom line. Walmart's CFO said increases in gross margin are due, in part, to "improvement in our cost of goods due to savings in procuring merchandise." This appears to be a direct reference to Walmart's warehouse tax imposed on suppliers last year, hitting company vendors up for 1% of the cost of inventory shipped through Walmart distribution centers.

The CFO also noted that "disciplined working capital management and the timing of payments" generated more than $5 billion in additional free cash flow. This improvement also appears to be funded by Walmart suppliers, either all or in part. Suppliers are still feeling the pinch of the company's demands to extend payment terms to 120 days from 30 and, in many cases, still be eligible for a cash discount.

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By Kim Souza
Talk Business & Politics / The CityWire
6/1/2016

“It’s been about a year since Walmart began telling suppliers of planned changes to contract terms that involved a 1% warehousing allowance, new store allowances and asking for extended payment terms on items that don’t sell…

Boyd Evert, president of Harvest Revenue Group in Bentonville, has met with hundreds of small to medium-size suppliers over the past year regarding the contract changes which he says is partly responsible for Wal-Mart’s better financial results in recent months…

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By Boyd Evert
President, Harvest Revenue Group
LinkedIn Pulse
6/1/2016

Walmart has many successes to celebrate. In recent months it has raised wages, built new distribution facilities and expanded e-commerce capabilities. But at what cost?

Over the past 12 months, Walmart has also unilaterally implemented new policies on its suppliers which are likely to mean consumers paying higher prices, such as:

* Walmart now charges most of its vendors a one percent surcharge to have products pass through the company's warehouses. They did this outside the scope of existing agreements with the suppliers - essentially expecting them to eat the cost.

* Walmart has demanded changes in how they pay for merchandise, often waiting 90 and 120 days to pay its bills. It is holding millions of dollars due to the suppliers for an extended period of time with no return for the supplier - but they'll lend it back to the supplier, with interest, if the supplier needs the money to cash flow.

In the course of our business helping suppliers manage deductions, claims and third-party audit issues, I’ve spoken with hundreds of suppliers who are concerned about these new, arbitrary actions.

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By Chris Bahn
Arkansas Democrat-Gazette
12/20/2015

Harvest Revenue Group President Boyd Evert’s “company launched an answer to a decades-long practice of retailers hiring third-party firms to help identify where they could recoup fees and billing errors from vendors. Post-audit generates an estimated $1 billion per year or more for retailers...

“How is the auditing process different per retailer?

“Wal-Mart, from a data perspective, is the most transparent of any retailer. They expose a lot of information to supplier community. It gives you great visibility and understanding, but on the other hand, they’ll also hold you accountable. They’re giving you this data, so there is some give and take. Target doesn’t have as much data, they don’t expose as much, but with every deduction, they work to give the data behind it. I would say one of the more difficult retailers, not just from my perspective, but my clients’, is Best Buy. They don’t share the data of record. Companies like that make it very difficult for suppliers.

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By Sarah Nassaur
The Wall Street Journal
10/25/2015

“…Vendors hope Wal-Mart’s big investment in stores and online sales can make the company stronger in the long term. But news of next year’s lower profits sent shudders through the supplier community, where there are concerns that there will be ‘increased pressure on suppliers to fund their problems,’ said one Arkansas-based executive at a large consumer-goods company.

“Such fears aren’t without basis. In June, for instance, Wal-Mart asked vendors to pay a fee for passing products through Wal-Mart’s warehouses and accept longer payment windows.

“Several large suppliers have told Wal-Mart flat-out that they can’t agree to the terms—saying the new contracts will increase the cost of doing business and force them to raise prices, according to email correspondence between suppliers and Wal-Mart viewed by The Wall Street Journal

“Behind the scenes, Wal-Mart is also aggressively pressuring suppliers to spend more money to earn a spot on shelves. In June the retailer started mailing out around 10,000 contract renegotiation letters to suppliers asking many to pay additional fees to store their products in warehouses, as well as give the retailer more time to pay for the goods, according to letters reviewed by the Journal.

“’Smaller suppliers will tell me if they push this out we will go out of business. We can’t afford to give them these allowances’ and sell at low prices, says Boyd Evert, a former consultant to Wal-Mart who now owns Harvest Revenue Group, a firm that represents many suppliers in negotiations with Wal-Mart.

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