CVS Compliance Fines and Metrics

Compliance at CVS revolves around a number of guides and programs and an organized system of fines that can be disorienting to the most seasoned suppliers. 

Disputing CVS Compliance Fines in the Traverse Portal

CVS's compliance deductions can be viewed and disputed in the Traverse Portal, a subset of CVS Health. In this portal, on the right-hand side menu under Vendor Tools, are several options related to compliance charges and disputes:

• Find Charges

• Find Scheduled Reports

• Create Disputes

• Find Disputes

• Find Resolved Disputes

• Find Reversals

There are three main compliance programs within the larger Supply Chain Performance (SCP) program that are managed in the Traverse Portal:

• OTIF (On-Time In-Full)

• Small Parcel (case limits for ground shipments)

• ASN (Advanced Ship Notice)

Each of these has its own special endings for SCP deductions at the end of the charge number: 

• OTIF ends with -OT

• Small Parcel ends with -SP

• ASN ends with -AS

How to Dispute Compliance Fines in the Traverse Portal

To view charges in detail, start with the Find Charges tab:

Traverse Portal > Vendor Tools > Find Charges

Compliance fines are no longer eligible for dispute 45 days after the charge deduction date, and they are no longer searchable in the Traverse Portal after a year (365 days).

A weekly compliance summary is sent to the supplier via email (from supplychainperformance@traversesystems.com) containing the charge # for the fine. This can be used to search for the fine in the Traverse Portal. 

NOTE: a separate monthly report will be received via email (from supplychainperformance@cvshealth.com) containing a wide variety of payment information on the individual compliance fines received throughout the month. This can also be a helpful resource for finding and disputing compliance fines. 

Once the charge has been found, if it is disputable (within the 45-day window), click on the charge number to begin the dispute process:

From there, the portal will take you to a Charge Detail page, which contains all of the information available on the charge.  

Underneath, in the Related Information section, the Reports tab contains an exportable PDF version of the Chargeback Detail report.

From there, you can go to the Create Disputes tab under Vendor Tools and plug in the Charge Number. Most of the information will auto-populate, but some sections require manual input, namely Attachments and Comments.

Dispute Documentation for compliance fines varies significantly depending on the performance metric that the charge pertains to.

Suppliers can follow up on deductions in the Find Disputes tab to review disputes that have already been submitted.

Compliance Performance Metrics

There are four primary compliance performance metrics with their own discrete penalty systems and invoice identifiers.

Compliance Performance Metric	Definition	Penalty	Invoice Identifier
On Time and In Full	Measure of ability to deliver product in accordance with the STA date and consistent with original purchase order quantities. Percent of PO cost based on monthly performance: 0% charge above 95% compliant, 1.5% charge between 95-85% compliant, 5.0% charge below 85% compliant	SCP + "Charge Number" + OT	Ex: SCP123456OT (before 2020, no OT on end)
Appointment Integrity	Measure of ability to honor warehouse delivery appointment(s). Failure triggered by one of the following events (does not include weekends or holidays): - Arrival beyond one hour of scheduled appointment - Cancellation or Reschedule request with less than 24 hours prior to delivery - Failure to arrive for scheduled appointment	$275 per chargeable penalty/no max	AI + Vendor Number + Month + Year. Ex: AI12345JUL2020
Bill of Lading	Missing or Inaccurate Bill of Lading	$100 per load	B + Vendor Number + DC Code + PO Number. Ex: B12345CH123456
Packing List	Missing or inaccurate Packing List	$100 per load	P + Vendor Number + DC Code + PO Number. Ex: P12345CH123456
Small Parcel	Measure of adherence with case limits for small parcel/ground deliveries into the CVS distribution network: - Prepaid Delivery: 15 Cases - Collect Delivery: 30 Cases. $5 per case over the limit, up to $150	SCP + "Charge Number" + SP	Ex: SCP1234567SP

OTIF

OTIF fines can be found by the same search method described in the above section (How to Dispute Compliance Fines in the Traverse Portal) and by looking for the -OT suffix at the end of the charge number.

Purchase orders are evaluated for OTIF ten calendar days after the initial or first receipt of the purchase order. 

On Time

CVS defines On Time delivery as purchase order deliveries that are consistent with purchase order Ship-to-Arrive (STA) dates. STA dates are the rough CVS equivalent of MABD (Must Arrive by Dates) at other retailers. 

Prepaid Requirements

• The PO can arrive on or up to four business days before STA dates, holidays and weekends excluded.

• The Scheduled Delivery date must also fall within this window. If CVS schedules a delivery date outside of the compliant delivery window, the supplier will not be held accountable.

• NOTE: Small Parcel POs shipped as Collect will identify as Prepaid in the traverse portal.

CVS provides the following examples to demonstrate how the collect program works:

Collect Requirements

• CVS's official policy for Collect shipments is that suppliers will not be held accountable for the performance of CVS carriers.

• Available pickup dates need to be carefully planned using the zone transit matrix.

• Shipping information needs to be entered three days before the available pickup date.

Collect shipping at CVS follows the below Transit Matrix: 

Backhaul Requirements

• These requirements are very similar to the requirements for Collect.

• System entry date is not as relevant, but there must be a minimum of four days of transit allowed between pickup and STA date.

In Full

CVS defines In Full shipping as when the purchase order delivery is consistent with the original purchase order quantities.

• This metric is evaluated down to the SKU/line level for grading.

• In Full is mostly used to calculate "OTIF Effectiveness." The overall score and fine bucket are based on that:

A combined OTIF Score is used to assign fines at the PO Level. Monthly vendor performance is assessed each month for all purchase orders, with a first receipt in the respective month.

General OTIF Best Practices

• Adjustments to the original order (i.e. item cuts, reduced quantities, or changes in the STA date) without Inventory Management approval for an OTIF PO exemption may still generate OTIF expense offsets

• In-Full results for OTIF compliance do not necessarily mean that there was a shortage against your PO. It just means that a portion of the PO was not received within the OTIF receipt window. OTIF compliance and invoice payments are not associated in any way.

• For drop trailers, CVS has a list of preferred carriers:

Appointment Integrity

These fines cannot be found in the traverse portal and have to be researched and disputed through the supplychainperformance@cvshealth.com email.

• The whole appointment process is facilitated through the eAppointment Scheduling Portal.

• This program is only applicable to Prepaid shippers.

• Suppliers won't get fined if they use these preferred carriers:

For vendors not utilizing a preferred carrier and shipping loads under prepaid freight terms, penalties under this program are triggered by one of the following events (excluding weekends/holidays):

1. Arrival one hour outside of the scheduled appointment

2. Cancellation or Reschedule request less than 24 hours prior to delivery

3. Failure to arrive for scheduled appointment

Each violation can occur multiple times on a single PO or across multiple appointments. These fines are $275 per chargeable penalty.

Backup documentation for these types of deductions can be obtained upon request by emailing SupplyChainPerformance@CVSHealth.com. These are available up to 24 months or 2 years after the expense hits a check remittance. 

The subject line of the email should be "request for backup AI." The body of the email must provide the deduction invoice(s) as it appears on the check remittance or a copy of the check remittance(s).

Packing List and Bill of Lading

These fines also cannot be found in the traverse portal and have to be researched and disputed through the supplychainperformance@cvshealth.com email.

Packing List and Bill of Lading fines can be found by the same search method described in the above section (How to Dispute Compliance Fines in the Traverse Portal) and by looking for the B- or P- prefix at the beginning of the charge number, depending on which fine it is. 

This fine is structured around tracking missing or inaccurate packing lists/bill of ladings. These fines are identified at the DC. A $100 penalty is issued per incident.

The backup for these types of deductions can also be obtained upon request by emailing SupplyChainPerformance@CVSHealth.com. They are available up to 12 months after the expense hits a check remittance.

The subject line of these emails should be "request for backup PL/BL." The body of the email must provide the deduction invoice(s) as it appears on the check remittance or a copy of the check remittance(s).

These are not eligible for dispute. CVS says that their "distribution centers have been given very thorough instructions regarding the assessment of packing lists and bills of lading... [and that] Each violation tagged as non-compliant has undergone thorough review, and the Supply Chain Performance team is confident in each violation identified." 

Small Parcel

Small Parcel fines can be found by the same search method described in the above section (How to Dispute Compliance Fines in the Traverse Portal) and by looking for the -SP suffix at the end of the charge number.

CVS generally prefers suppliers to avoid Small Parcel shipments because they are more costly and take longer to receive. Because of the impact small parcel shipments have on their DC network, there are set limits that need to be met when shipping Small Parcel:

In other words, suppliers will receive "offset deductions" of $5 per carton/case up to a maximum of $150 for shipping Small Parcel. 

Oversight and Insight with SupplyPike

For more free educational content like this (eBooks, Cheat Sheets, Webinars, and Articles), sign up for our newsletter or visit our website. We cover material essential for retail suppliers, especially topics related to revenue loss at Home Depot, Walmart, Amazon, Target, and Kroger. 

Get Insight with SupplyPike's Software 

Maintaining a healthy supply chain from start to finish is difficult in the retail world. SupplyPike's software helps retail suppliers in Home Depot, Walmart, Amazon, Target, and Kroger get paid and get better.

SupplyPike tests the validity of chargebacks, collects your proof documentation, and takes disputing a claim down to a few (or zero) clicks automatically. Our software also helps suppliers avoid these fines entirely by digging into root cause analysis and giving executive-level oversight into the supply chain.

Schedule a meeting with a team member to find out if SupplyPike is right for your retail business.