Walmart Supply Chain Management for Third-Party Sellers: Best Practices, Tools, and Common Pitfalls

Success on Walmart Marketplace doesn’t just depend on great products and competitive prices. It’s also about how efficiently and reliably you manage your supply chain. Whether you’re new to the platform or looking to optimize your ecommerce business operations, understanding how to navigate Walmart’s supply chain expectations is essential.

Walmart has built one of the most sophisticated supply chains in the world. As a third-party seller, tapping into that infrastructure, whether via Walmart Fulfillment Services (WFS) or seller fulfilled options, requires thoughtful planning, smart systems, and a commitment to operational excellence.

In this guide, we’ll explore supply chain management from the perspective of a Walmart Marketplace seller, covering:

• How the Walmart supply chain impacts third-party sellers
• Best practices for managing inventory and fulfillment
• Recommended tools for visibility and automation
• Common supply chain mistakes and how to avoid them

Why Supply Chain Management Matters on Walmart Marketplace

Walmart’s customer promise centers on everyday low prices and fast, reliable delivery. Your ability to meet or exceed those expectations directly impacts your Buy Box eligibility, listing visibility, customer reviews and return rates, and overall seller performance metrics.

With millions of products on the platform, Walmart gives preference to sellers who consistently deliver on-time, maintain inventory levels, and minimize order defects. Poor supply chain management can quickly erode your performance and jeopardize your account.

Understanding Walmart’s Fulfillment Options

Before diving into best practices, let’s review the two main fulfillment models:

1. Walmart Fulfillment Services (WFS)

WFS is Walmart’s in-house fulfillment network. You ship inventory to Walmart’s fulfillment centers, and they handle storage, shipping, returns, and customer service.

WFS Advantages:

• 2-day delivery badge
• Improved Buy Box visibility
• Simplified customer support
• Trusted Walmart branding

2. Seller Fulfilled or 3PL

You manage your fulfillment process directly through your own distribution center, third party logistics (3PL), or drop ship provider. This gives you more control, but also more responsibility for service levels.

Challenges:

• You’re accountable for shipping times and customer service
• Higher risk of late shipments, stockouts, or delivery issues
• Shipping costs can be higher
• Must meet strict Shipping Standards to remain in good standing

Whichever model you use, supply chain reliability is key.

Best Practices for Supply Chain Success on Walmart Marketplace

1. Demand Forecasting and Inventory Planning: Be Proactive

One of the most common mistakes sellers make is underestimating lead times—from sourcing products to delivering them to fulfillment centers.

Tips:

• Use historical sales data, seasonality, and promotional calendars to forecast demand
• Plan inventory levels 30–60 days in advance, especially for peak seasons
• Use safety stock buffers to avoid stockouts

If you’re using WFS, make sure to monitor restock alerts and recommended replenishment levels in Walmart Seller Center.

2. Optimize for Fast and Reliable Delivery

Fast delivery directly influences your search ranking and conversion rate. For MFN sellers, aim to offer 2-day or 3-day delivery options where possible.

How to achieve this:

• Use regional warehouses or distributed 3PL networks
• Offer expedited shipping through preferred carriers
• Set realistic shipping templates in Seller Center to avoid late shipments

Walmart’s 2-Day Shipping program is a great way to stand out, but only if you can meet the promised delivery speeds consistently.

3. Use WFS for High-Demand or Fast-Moving SKUs

WFS can help streamline your operations by taking fulfillment off your plate and increasing trust with customers.

Pro tip: Start by enrolling your best-selling SKUs or seasonal items in WFS to test performance. Over time, you can scale and optimize based on your profitability and storage needs.

4. Maintain Accurate Inventory Levels

Inventory accuracy is crucial for avoiding canceled orders and negative seller performance metrics. Cancellations can directly impact your Order Defect Rate (ODR) and customer trust.

Best practices:

• Sync your inventory across all platforms (Walmart, Amazon, Shopify, etc.)
• Automate inventory updates with a reliable feed or software
• Monitor low inventory alerts in Seller Center

If you’re managing inventory across multiple sales channels, a centralized inventory management system is a must.

5. Follow Walmart's Packing and Labeling Guidelines

Be sure to thoroughly review the Walmart Marketplace packing and labeling guidelines carefully. This helps Walmart receive your inventory faster and avoids delays caused by incomplete or missing labels. Failure to follow the guidelines can result in rejections, delays, or additional prep fees.

Helpful Tools for Walmart Supply Chain Optimization

Here are some software platforms and multichannel solutions programs that can help you manage and optimize your Walmart supply chain, and additional online marketplaces:

1. Deliverr (Now part of Flexport)

• Fast 2-day fulfillment for Walmart and other online marketplaces
• Integrates directly with Walmart for fast shipping tags
• Distributed warehouse network for reduced delivery times

2. MyFBAPrep

• Nationwide warehouse network that supports WFS prep
• Ideal for sellers who need to prep and forward inventory to WFS
• Transparent pricing and logistics dashboards

3. ConnectBooks

• eCommerce accounting software that syncs your inventory data to QuickBooks or Xero
• Gives a clear, in-depth view of your inventory's true value and health
• Provides real time sales and profit analytics and trends at a glance
• Track performance, uncover hidden fees, and make data-driven decisions with ease

4. KwickMetrics

• Analytics platform that provides supply chain, profitability, and performance insights
• Custom dashboards for inventory turns, stockouts, and replenishment cycles

5. ShipStation, ShipBob, EasyShip

• These platforms help seller-fulfilled operations to streamline shipping and label creation
• Integration with multiple carriers, automation rules, and tracking tools
• Optional 3PL services to help decentralize your warehouse operations

6. Aura

• Automated, instant Walmart repricer helps you grab the Buy Box before competitors even refresh
• Adapts to market changes fast while following your minimum and maximum prices
• Surfaces the "why" behind every price move
• No more micromanaging your prices. This frees up your time to focus on other areas of your Walmart business.

Using the right tools can help automate much of your supply chain, reduce the risk of manual errors or stockouts, increase efficiency and profit.

Common Mistakes Sellers Make—and How to Avoid Them

Even experienced sellers can run into supply chain roadblocks. Here are the most frequent issues and how to steer clear of them.

1. Inaccurate Inventory Feeds

Failing to sync inventory across platforms can lead to overselling, cancellations, and frustrated customers.

Avoid it by: Using a multichannel inventory management tool or API integration that updates stock levels in real time.

2. Not Following WFS Inbound Guidelines

Improper packaging, missing barcodes, or unlabeled cartons can delay receiving or result in added prep fees.

Avoid it by: Using Walmart’s WFS Inbound Order guide and submitting accurate ASNs. If needed, use a prep partner like MyFBAPrep.

3. Underestimating Lead Times

Many sellers overlook the time it takes to source, prep, and ship inventory—especially during peak Q4 demand.

Avoid it by: Building a supply chain calendar and factoring in buffer time for supplier delays, customs clearance, and carrier slowdowns.

4. Overreliance on One Fulfillment Method

Putting all your fulfillment eggs in one basket—whether MFN or WFS—can limit flexibility.

Avoid it by: Diversifying your logistics options, using a hybrid model, and having contingency plans for inventory rerouting or overflow.

5. Ignoring Performance Metrics

Failing to monitor metrics like On-Time Delivery Rate, Inventory Accuracy, or Cancel Rate can lead to warnings or account suspension.

Avoid it by: Setting alerts for key thresholds in Seller Center and conducting weekly supply chain performance audits.

Tips for Scaling Your Walmart Marketplace Supply Chain

As your business grows, your supply chain needs to evolve. Here’s how to scale and improve efficiency without sacrificing quality:

• Standardize SOPs: Create standard operating procedures for receiving, prepping, and shipping inventory.
• Implement an OMS: An Order Management System gives you control and visibility into order flow across channels and warehouses.
• Forecast Promotions: If you’re planning Walmart Sponsored Products or Deals promotions, use inventory data to forecast how much inventory needs to be in place ahead of time.
• Use Reporting Tools: Monitor performance trends and identify bottlenecks before they cause customer disruptions.

Conclusion: Supply Chain is the Backbone of Walmart Marketplace Success

Whether you’re shipping from your own warehouse or relying on WFS, your supply chain is the engine that powers your Walmart business. Inventory that arrives late, is poorly prepped, or runs out during peak demand can damage your sales and your reputation.

By implementing best practices, leveraging the right tools, and avoiding common mistakes, you can build a resilient, scalable supply chain that supports long-term success on Walmart Marketplace.

Pro tip: Start by auditing your current supply chain. Key factors to evaluate are: Where are delays? What can be automated? Which SKUs would benefit from switching to WFS?

With a smarter, more strategic approach to fulfillment, you'll be better positioned to win the Buy Box, delight customers, and grow profitably in the competitive world of Walmart Marketplace.