Ep. 13 - From DSS To Scintilla: The New Data Playbook For Walmart Suppliers with Jeff Clapper

DSS trained a generation of Walmart suppliers to run the business on shared data. Now that era is ending, and the Scintilla era is forcing a new standard. We sit down with Jeff Clapper, CEO of 8th & Walton in Bentonville, to talk through what the best supplier teams are doing to stay ahead of the cutover, build real capability in Walmart retail data analytics, and avoid the painful surprise of logging in one morning and realizing the old tools are gone.

From there, we zoom out to the bigger shift: omnichannel. Selling through Walmart today isn’t just a store conversation and it isn’t just an e-commerce conversation. It’s one connected system where inventory, item content, search ranking, ads, marketplace activity, store pickup, and delivery all collide. Jeff explains where supplier teams get stuck, why outsourcing digital work can create blind spots, and what it takes to integrate sales, supply chain, and e-commerce into one operating rhythm that matches how customers actually shop.

We also get practical about execution and profit. OTIF still matters, penalties still hurt, and deductions, chargebacks, invoicing problems, and pricing errors can quietly drain a Walmart P&L. The difference-maker is cross-functional ownership and a root-cause mindset that stops recurring issues instead of feeding a permanent dispute process. If you support a Walmart supplier team, work in Northwest Arkansas, or want a sharper playbook for Walmart Scintilla and omnichannel strategy, this conversation is for you. Subscribe, share this with your team, and leave a review with the one change you’re making after listening.

Transcript

Welcome And Why Supplier Teams Matter

SPEAKER_00 0:06

Well, hello everyone, and welcome to the Digital Front Door. I'm Scott Benedict. So, throughout my career as a retail merchant, one of the most gratifying aspects of my responsibilities was the opportunity to locate really high-quality suppliers of products my customer wanted to buy. In effect, being a merchant with any retailer made you an agent for the customer, charged with finding great products that improved their lives and offered them great value. During my time at Walmart and Sands Club in particular, I found that most brands positioned their best teams, staffed with their top people on our business, not only because of the size of the Walmart and the Sands Club account, but because the complex nature of operating a business and partnership between the top brands and the top retailer in the world who required the best talent operating at the absolute top of their game for both the brand and for us as a retailer to be successful. Now, in recent years, the expectations of the large supplier community have not changed, but the definition of excellence and the attributes of top supplier teams has evolved and changed in what I think are some pretty fascinating ways. I personally find this topic very interesting. As I connect with other members of the Northwest Arkansas community, I find that I'm not the only one. One person that has a great perspective on this topic is Jeff Clapper. Jeff is the CEO of Ethan Walton, a firm based here in Ingettonville that provides both supplier education and advisory services to Walmart suppliers. And Jeff Jones is here in the studio. And Jeff, welcome. And so happy to have you here today and talk about the subject I know we both have kind of a passion for. Yeah. Yeah, thanks for having me. My pleasure. So I know that you've been on uh podcast with Andy Wilson before, and some folks in our audience may know you and may know Aethan Wallon, but just maybe for some members of the audience who haven't had an interface with Aethan Wallin, can you kind of introduce what your company does and what are you really all about? Sure. Yeah. I mean, kind of as you said a minute ago, uh suppliers are putting their greatest talent and investment in Walmart as one of their top customers. And uh along with that effort, Aethan Walker provides best in class education and consulting to those Walmart supplier teams. Um so that really spans all areas of a cross-functional or omnichannel team, supply chain, sales analysis, uh, e-commerce, accounting and finance, uh, but really all key functions as far as uh the best in class supplier would want to have excellent uh people supporting that business. And it's it's classroom education and some uh to some degree ongoing education or consulting with suppliers. Awesome. Feels like there's there's a there's a need for that, certainly historically and and particularly now. And one of the first topics that occurs to me that's that's a topic of your conversation throughout uh the Northwest Arkansas area is Walmart's plans to migrate their suppliers from using the decision support system, or or DSS as it's commonly down, onto their new Luminate platform. And that transition feels like it's it's pretty important to suppliers, but what what's what's your view on that topic? Yeah, I mean, you're absolutely right again. It is it is critical that suppliers familiarize themselves and really become uh experts in in usage of Luminate. Decades ago, when Walmart introduced DSS and retail ink, I think there was a lot of it was it was a wide open space that that was a revolutionary idea to say we're going to share this data with suppliers and we expect them to use it to maximize their business and ours. And over those years, suppliers really got on board with that idea and became accustomed to using that data in the way that Walmart intended. Uh now with the with the launch and and sort of uh really uh impending crossover, cut over to Luminate, suppliers know that all of their operational data and a whole lot more um is available for their use to build their business with Walmart. And so uh and and and DSS will not be an option anymore. So you know, kind of coming back to your question in terms of uh how important is this to suppliers, all of the suppliers who have made the most of the the data from DSS are really kind of working through that transition now uh because that will no longer be an option and they will have to access that through Luminate either as a basic subscriber or a charter subscriber. So it feels like it's a it's a pretty big kind of milestone moment that they have to get ready for. And if they're not, it's got they've got the business of potentially itself, right? Yeah. I mean, one of the one of the neat things with Aethan Walton, we you know we work with thousands of suppliers every year uh by way of our classroom and consulting. And and um it's neat. We really see all shapes and sizes and all levels of familiarity with what's happening here in Bentonville. Um, and so there are some suppliers who have known about Luminate truly for years, right, at this point. Uh, and then there are other suppliers we know from all the all words. We've been doing this for almost 20 years. We know from that span of time that there are suppliers who are going to wake up. I mean, honestly, they're going to wake up on a on a cold Monday morning and try to log into DSS and think, oh my gosh, what has happened? Right. Um, and so we we we've tried to provide a lot of resources. Walmart has provided a bunch of great resources for learning and familiarizing uh suppliers with Luminate, and then we're you know kind of taking that an extra step and and providing a lot of extra uh kind of hands-on guidance and consulting and uh education in that space. Um, but we're also just trying to get the word out with conversations like this. And if we can help a few more people not have that uncomfortable one day morning, uh, that would be great. That that makes a lot of sense. You know, in addition to that, it feels like uh Walmart's focus on on the channel and and being prepared to serve a customer however, whenever, and wherever they they really want is also very much at the core of what Walmart, a Walmart supplier has to be focused on. What do you feel like as you'd work with suppliers and the team? What's kind of the big gap, uh perhaps in a supplier's understanding of or ability to leverage Walmart's commitment to Omega? Sure. Yeah, it's a it's a terrific question. I think um a little bit of a roundabout thought on that. A few years ago, it was really focused on the sales relationship that, you know, between the salesperson and their buyer at Walmart. Um and with OTIF, you know, probably close to seven, eight years ago now, um, they really expanded that to say, let's make sure that this is a cross-functional conversation between the sales team, the supply chain team at Walmart, and their contributions at Walmart. Right. Um, so that broadened the engagement and the importance of making sure, hey, we in order to have a sale, we have to have a product on the shelf. Right. This isn't just a relational sales conversation. There's a whole lot of operations that have to support that. Now, uh, you know, I get back to the question of Omnichannel, it is all of that plus really uh comprehensive best in class uh e-commerce knowledge and capabilities. Right. Um, you know, we've we've seen some suppliers who, understandably, for strategic reasons over the last few years, have said, here's an outside group that can help us with this part of our e-commerce. So we'll kind of just set it aside. Yeah. And uh, and these are smart, capable teams. It's a sensible decision. Yeah. Uh, there's a lot of good reasons to do that. Um, and and and at the same time, with Walmart's uh good at consistent effort to pull that together into an omni-channel conversation. Uh, some of the suppliers we work with are seeing that when, for example, marketplace is handled entirely by an outside firm and not a part of the sales and supply chain conversation, there are gaps and misses in, you know, are we promoting product that isn't actually available? Um, you know, are we are we actually, you know, neglecting items that need to be ranking well for our store sales to deliver, whether that is to the customer who's in the store or through an online pickup uh customer. Um, so really integrating the e-commerce conversation, the of course the supply chain conversation, yeah, the sales, the the direct relationship conversation with the virgin, pulling that all together, right, is is really where it's headed. It feels like just to kind of follow up on that, that in addition to kind of the strategic elements of do you have the core elements of your business strategy aligned to where Walmart is headed and serving that customer wherever they want to serve. But is there isn't there some kind of back office flag flips that make sure this item is available this way and ready fulfilled to this location for both online orders? And it feels like there's some back office element, yes, uh that it might be considered administrative as well as the more strategic aspects. Do you find that? Yeah, absolutely. You know, again, I would say those those priorities should be staying well aware of the channels where your items are available and how they are performing or ranking on those channels. Yeah. Um, and that can be impacted by the content around those items or or uh by way of the the ad or I should say by way of the advertising and the promotions and what you're doing to elevate the positions of those items. If you're not in the top few rows, you might you kind of don't exist. And where that could play out in a in a significant way, of course, is is if you are, let's say, doing a lot to optimize uh items that you consider e-commerce, all the items, um, and neglecting the prioritization of store items, and then the store buyer, you know, for the the buyer rather comes back and sees you know, you're these items in the stores are are not performing through the online channel in the way that we'd like to see, or the online pickup channel on the way the way that we'd like to see. Yeah. Kind of bringing it back to your question again. If it's not available, yes. You know, as at the end of the day, it I mean, a couple of years ago, I think it was actually admin doing business in Bedonville, Bet. Uh, we heard a senior leader from All Art say, make sure it's at the store for that channel. If it's not at the store, whether they're doing online pickup or Bob, you know, putting it in their own basket, we can't sell it. Yes. You know, that's the key. That that feels like as the the buying function for online migrated from San Perino back here, and now you kind of got omni buyers and omni-sellers. There was not only education internally that Walmart had to do with their teams, but the suppliers had to really become more omni in their view. I'm curious, if you kind of zoom out for a second, overall do you encounter most teams are they're ready for that challenge, they're part way on that challenge, kind of the adequately of what's your your view of the readiness of the supplier community to do business that way. Yeah. I would say there is sometimes in our own business, we talk about gets it, wants it, has the capacity to do it. Um, and I think there are a lot of suppliers who get it, yes, and a lot of suppliers who want it. Yes. I think there's still a pretty good gap on do they have the capacity to do it? Gotcha. So there's still some work to be done that feels like heading in a good direction. Good. So one other kind of continuation of that omni channel theme, Walmart has always challenged suppliers to embrace the concept of store of the community, which in in the the physical retail world may involve making sure that the the product that was offered based on the size of the store, the location of the store, the demographics of the store fit the fit the community. So it wasn't just one product assort across the entire chain. Does now the overlay of OmniChannel make that challenge for a supplier harder, easier? Well, what do you guys see in your your interactions with suppliers? Um there's a lot of there's a lot of data that is becoming available to suppliers to address that opportunity. Yeah. Um you know, there we go. I think there's there's still a lot of room to make the most of that. Right. Um, so directionally, I think it's great. Yeah. Um, I think there are a lot of suppliers who are really far from making the most of that data to become a store of a community supplier. Right. Um having the data is a great first step. Yeah. Knowing how best to use it is the next big thing. Pulling the insights out of it. Yeah. It's still probably a work in progress. That's right. I was like, yeah, gotcha. The pandemic, which has uh created a lot of havoc in supply chains across the industry, while their suppliers were not immune uh to its impact on time infall or OTIS or remains an expectation of Walmart for its suppliers. And it seems like it's an area where of the business that suppliers really need to execute on with precision. They should have focused, financial ramifications, in addition to just miss sales for not doing that. What are the best suppliers that you you guys work with? What are they doing to execute kind of at a world-class level on that aspect uh of their business? Yeah. Um they are making sure it's a cross-functional conversation. Right. Um, and they make sure that they have uh someone who's accountable for, for example, enzyme infull scores or up OTIF scores. Yeah. Um, you know, we OTIF has been up, like I said, for many years now. And and yet it's not new. It's not new, and and still there are suppliers who are just getting their heads around it. Um, maybe it's because something changed in the business and all of a sudden now they are getting OTIF penalties where they didn't used to. Um, but uh, you know, the the story that I tell is uh a lot of our conversations begin with uh the salesperson who owns the Walmart relationship, um, just got a call from the CFO. And the CFO said, What are these OT and decisions? What else going on? And they may be large. Um and they say, Well, your main tag says Walmart. So the person I'm calling about. Um and and then the and and so that's an understandable uh first conversation. Inevitably where it goes is it turns into a conversation between sales and operations and finance. And that's actually a great win for the supplier and for Walmart when it pulls everyone into that cross-functional dialogue about how are we managing the operations and the delivery to Walmart. So now the suppliers who do that well continue to have those conversations and they have some accountabilities around it. Yeah. Building on that feels like the core is forecasting on the front side and sitting with the buyer's team on a regular basis to say, are we a line on these forecast? And then at the same time, you know, the some of the levers of demand are not just customers walking to the store and buying it and walking out to the front door, but product going out the side door to store pickup, uh, delivery, drum delivery, shift from stores, shift from store. Exactly. So it feels like that's an area where even you know, at the top level relationship, there's a lot of focus. But it feels like, you know, just the analyst and the supply chain team and those have really got to understand how to work collaboratively with the Walmart counterparts, be able to master the systems, uh the planning systems, that sort of thing. Yeah, yeah. Yeah, absolutely. And I think it goes back to your your earlier question about how do uh great omni-channel teams do this. You know, one of my points there would again be understanding those distribution channels at Walmart and how they work, uh, making sure you have inventory FCs uh for those different channels to effectively deliver and meet the demand. Um, and now the other side of the demand, also I kind of we kind of touched on it, but making sure you're driving, you know, to the extent that you now have opportunity to drive demand with Walmart in ways that you didn't before by way of, let's say, advertising. Yes. Make sure you're driving demand where you have inventory. That seems so logical. Yeah, if it feels like it's it's not as easy as not, yeah. Easier said than uh but you start by by paying attention to it. Makes sense. Yeah. Makes sense. Dealing with a retailer of the size of Walmart, I would imagine that some of the back office tasks, uh things like deductions, pricing errors, invoicing, chargebacks, oak to be one of them, really have a huge impact on the profitability of the supplier overall and on the PL for the Walmart account. Uh, specifically, what kind of challenges do you and the team see in terms of how suppliers kind of manage that, some of those back office functions? And are they being effective in doing it or is it a real challenge for them? Um it it certainly is a real challenge for many suppliers. Yeah. Um, I, you know, I don't believe Walmart. I mean, Walmart's not trying to make money by way of you know these charges, but it, you know, there's a cost to their business. And uh, you know, I think they recognize, you know, hey, having this transparency, having a, you know, having a channel for um reconciling some of these issues is good. Yeah. Um, but yeah, we do hear from a lot of suppliers who have challenges with uh chargebacks, deductions, penalties, and so forth. Um, we really strive to help them understand the root cause and resolve the root cause. You know, we think of it as like, hey, you go to the doctor, I'm getting these terrible headaches. If I mean you could take Advil for the rest of your life, yes. Um Does this solve the root? But does this we figured out why you're getting the headaches? That might be preferable, right? Yeah, don't get the root cause. Yeah, never gotta go. That's right. That's right. And the and and we will hear from suppliers like, hey, we've got you know, we've got people ready to dedicate to the dispute process, or maybe we even have outside resources for it, or and you know, hey, that's a great place to be. Yeah. Um, if we can help you free up that resource in whatever shape it's taking, yeah, um, you're going to be more profitable. Walmart's glad to see better results, like you know, rather than continuing to take the aspirin. I guess. So I I know that Aetherwalton supports supplier teams, not just here in the US, but in the Canadian market as well, supporting uh Walmart, Canada. Is there anything that kind of jumps out to you out at you as differences between the supplier community that you help serve Walmart Canada and maybe the community here that that works with Walmart US? Um you know, my I I think what we would see there might be fairly obvious. It's a different uh size customer to the Canadian supplier. Um so just a different uh investment of resource from those Canadian suppliers, um, particularly if they're only in Walmart Canada. Gotcha. Um if Walmart can't, if they are working with both US and Canada banners, um, then they see it that they want to invest in the customer overall. Right. Uh they know that there's opportunity in there that for regardless, there's opportunity, you know, across the divisions for or across banners for those suppliers. Um, you know, and then also they get the uh it's kind of like you know, time zones or something. They get the benefit of knowing uh when the sun is going to rise. So uh like you mentioned Luminate uh suppliers in Canada had some visibility to what was likely coming their way. Right. Of course, now that will be the case uh you know in the future. So uh just for Canadian suppliers, we're often encouraging them to keep an eye out. This is happening in the US. Yeah, probably just a matter of time before it adds your way. Yes. And and Walhorn, in a sense, said that that they're taking luminate to Mexico and then Canada. And so I think by the time that happens, there'll be some great learnings about the transition progress here. Feels like, well, then let you be effective in counseling suppliers. You're at a separate team. Yeah, so I'm gonna use the same team, right? I'm thinking also uh, you know, the sibling uh birth or like uh I got to watch what my older siblings hunt through with my parents. Yes. As the child my family, I could felt me. I could tell the running tab, as can my siblings. I know that recently you've been offered supplier cheeks kind of a free assessment, how they hey, let us come in, learn about what you're facing in your relationship with more, maybe how we can help you talk about that a little bit and why did why didn't you all come up with that? Yeah, um there are um there are many, many suppliers who uh who really the phrase we hear often is we don't know what we don't know. Um and uh and so we we we made that option available just to kind of walk through and say what's you know what are we seeing in your team and in your business that could be better and giving some guidance uh just to from a from a you know sort of no commitment, no cost conversation, but just to say, hey, you know, your supply chain, here are some potential hazards or opportunities, um e-commerce, the same thing. You know, maybe there are items that are so far down the list that you don't realize it, and it's only a matter of time until your buyer asks you what's going on with us. Um really just trying to help identify some of those things. Uh and then and then also just how's your team structure? Is there a way to pull that together that uh in such a way that that will give you better results and long term uh success with Walmart? a collaborative partner with Walmart. That makes sense. So talk a little bit about your team, if you will. If the goal of A Walt is helped the spires to be more effective, I assume you've got some experts on your your team that really uh have got have gotten the whirlwinds of uh of the past and then you said to help kind of guide a supplier to be more effective. Is that yeah that's I that's right. And I think that is right. You know that I would add um we work really hard to be continual learners and students of Walmart as customer for our customers and suppliers. You know, because our our team is comprised of 10, 20, 30 year veterans from uh retail at Walmart and Sam's Club in particular, um and all of the knowledge and war wounds like you said that are gained over the years are really invaluable. And at the same time to Walmart's credit, they are a dynamic, innovative retailer. And so what we knew you know a month or a year or 10 years ago may have no relevance. Gosh and so so we really work hard to continue to learn um to have the humility and the courage to continue to learn so that we can continue to bring curve uh you know just good insights and value to the suppliers that we work with. And then the other neat part for our team um I think on a couple of fronts one we get to really see the impact of the help we provide the other suppliers who are just really wanting to improve their business and their success. And then also we work with you know by by way of the classroom teaching that we do and the consulting that we do we work with so many different suppliers from so many different categories that we have the opportunity to really be continual learners. There's a dialogue in in all of those in all of those relationships that makes sense that and it occurs to me that to cultivate a high performing team with Walmart you can't really be passive and hope for the best that that as a supplier you've really got to continually take your game to another level make sure you're operating uh best way that you possibly can in order to kind of maximize business opportunities per se. Yeah in fact I um I think you I might have a a mutual uh associate Mike Cockrell who used to be a business partner of mine a terrific guy and he used to say I'm just having echoes of Mike in my head saying hope is not a strategy. You go on for him say uh when he I were both uh with the company yeah it is a recurring thing yeah that uh what uh made you successful in the past isn't the RT to make you successful yeah uh in the future so you kind of have to keep operating the bar or taking the bar to the higher level, right? Yeah. Jess thank you so much uh for coming and and and kind of sharing your thoughts. I hope you'll come back and and and talk with us again at this point in the future, particularly as Illuminate gets more fully rolled out I'm I'm sure there'll be interesting learnings that we have that that come out of it. So thank you yeah for for joining us uh today so my thanks to to Jeff for joining us and sharing his thoughts on this important topic and uh again continual investment in your performance uh uh with Walmart and with Sam's club is the best advice I think uh all of us can give and uh and certainly as a former uh buyer I I couldn't advocate for more more strongly so important topic something that continually lean in been an uh great having you on the the broadcast today for the digital front door I'm Scott Benedict thanks for listening