Compliance Management Vendor University Webinar Series

Revised 09/08

AgendaSession Objectives

Delivery Performance System

Access & Workflow

Infraction Types

ETA Management Program Overview

ASN Integrity Program Overview

Workflow Demonstration

Dashboard

Reviewing Infractions

Submitting Appeals

Reviewing StatusesSummary

Session ObjectivesThis session is intended to provide new DPS users basic training about the tool, as well as high-level overviews of the programs. All information contained in this presentation is also located in the vendor extranet and reference guides.

This session is not meant as a forum for debate about the merits of the program or Toys “R” Us’ policies.

Goal 1: Improved Workflow Efficiency

Goal 2: Improved Program Understanding

Note: Questions should be entered in the Questions Pane at the bottom of your screen. Questions will be collected and responses provided to the group following the session.

The Delivery Performance System (“DPS”)

DPS is a web-based application that enables on-line monitoring of vendor compliance.

DPS provides users the ability to:

View infractions as they occur

Appeal infractions on-line within the designated period

Supply supporting documentation

Verify status of appeals submitted

Query backup documentation for ETA and ASN deductions taken

Compliance Management | Workflow

The Delivery Performance System is designed to promote timely review and decision about non-compliance. The following workflow is governed by the parameters of DPS.

Infractions are loaded once a week on Sunday.

Infractions may be reviewed and appealed from the dashboard within 14 calendar days of the load date.

If an infraction is appealed within 14 calendar days of the load date, Vendor Partnership will have an additional 14 calendar days to review and respond to the appeal. All responses are final.

Infractions not appealed within 14 calendar days, or appealed infractions rejected, become a deduction.

Vendor performance metrics are updated to reflect the accepted appeal.

Compliance Management | Requirements

ALL appeals must be submitted in DPS during the appeal window.

No appeals are accepted outside of the DPS appeal window.

DPS Infraction Types

DPS contains infractions (non-compliance issues)

from both our ETA Management Program and ASN Integrity Program

Current Infraction Types:

ETA Management» Delivery» Fill Rate

ASN Integrity» Receipt without an ASN» Receipt with a Late ASN

ETA Management Program | Overview

Compliance program designed to drive complete purchase order fulfillment within the ETA window. Any order/item not meeting requirements below generates an infraction.

Prepaid On-time (All requirements must be met to be compliant)

Appointment Request by Tuesday of the ETA Window

Vendor's carrier must request appointment within ETA Window

Vendor’s carrier must deliver to the scheduled appointment

Collect On-time (All requirements must be met to be compliant)

Routing Request submitted at least three business days prior to Ship Window

Load Available to ship within Ship Window

Fill Rate Standard

Toys “R” Us, Inc. expects 100% fulfillment of our purchase order.

ETA Management | Certification

A vendor receives a ‘CERTIFIED’ status when achieving bothDelivery and Fill Rate performance standards at, or above, 95% for a rolling 13-week period.

• Weeks flagged as ‘CERTIFIED’ will have no chargebackspassed to the vendor.

• Certification is a weighted calculation, based on $s.

• Approved appeals positively affect performance ratings.

• Certification is recalculated weekly

ETA Management | Fee Schedule (On-Time)

All chargebacks are calculated against the non-compliant portion of the PO Line.

On-time

Compliance of greater than 95% of the PO Line cost results in no chargeback

Compliance from 85.1% to 95% of the PO Line cost results in 2% chargeback

Compliance at 85%, or less, of PO Line cost results in 5% chargeback

Non-compliance against ROTO product is subject to doubled chargeback

ETA Management | Fee Schedule

(Fill Rate)

All chargebacks are calculated against the non-compliant portion of the PO Line.

Fill Rate

Variance of less than 5% from the PO Line quantity results in no chargeback

Variance of 5% to 14.9% from the PO Line quantity results in 2% chargeback

Variance of 15%or greater from the PO Line quantity results in 5% chargeback

Non-compliance against ROTO product is subject to doubled chargebacks

ASN Integrity Program | OverviewThis program monitors compliance to our ASN requirements, specifically that a valid ASN be provided by the vendor for each shipment to a DC or store.

Fee Schedule: DC Receipts

EDI 856 INVALID or NO DC ASN SENT results in a $500 per order/location receipt chargeback

EDI 856 VALID DC ASN SENT LATE results in a $500 per order/location receipt chargeback

Fee Schedule: Store Receipts

EDI 856 INVALID or NO STORE ASN SENT results in a $50 per order/location receipt chargeback

EDI 856 VALID STORE ASN SENT LATE results in a $50 per order/location receipt chargeback

Accessing DPSClick on the DPS link available on the Toys “R” Us vendor extranet at

https://vendorconnect.toysrus.com/. You must log in before accessing DPS.

The link will only be visible if you have been assigned DPS access by your

Security Administrator.

Who should have access? EDI, Logistics, Customer Service, Accounting

DPS Dashboard | Getting StartedThe dashboard is the home page of the DPS application. It provides

you with a quick snapshot of current infractions, appeals, and

certification metrics for the ETA Program, along with easy navigation

to search for transactions.

Reviewing InfractionsThe first step for effective compliance management is to review new

infractions. To start, click on the new infractions link.

Reviewing InfractionsOnce the Infractions link is clicked, the Vendor Infractions Screen will

appear. To drill into your infractions list, click the vendor name link.

Reviewing InfractionsOnce the List Infractions Screen appears, you may drill into an

individual infraction to review the details. To drill, simply click the

infraction link.

Exporting InfractionsBEST PRACTICE ALERT: The best method for reviewing current infractions,

is to utilize the appropriate export functionality. Once exported, the document should be saved in Excel for full Excel functionality.

Infraction Details | ETA Management

Type Reason Description

Delivery

Non-

Complian

ce

Early Receipt (Prepaid) Merchandise appointed before the ETA

weekLate Dlvry-Appt Request

(Prepaid)

Merchandise appointed after ETA week and

appointment request was not by Tuesday

of the ETA week.

Late Dlvry-Req Dlvry Dte

(Prepaid)

Merchandise appointed after ETA week and

carrier/vendor requested a delivery date

outside the window.

Late Routing Request

(Collect)

Routing Request was not submitted 3

business days before the ship date on the

purchase order.

Late Load Avail Date

(Collect)

Merchandise was not made available for

carrier pick-up within the ship window.

This is based on the load available date

submitted on the routing request.

Fill Rate

Non-

Complian

ce

Open Quantity (Prepaid) A qty less than item order qty was

received. An open order qty still exists.

Open Quantity (Collect) A qty less than item order qty was received

or shipped.

Over-Shipment A unit count over the item order qty was

received.

Infraction Details Screen| ETA Example

Infraction Description

Infraction Details

Subline Details Screen| ETA Example

Subline Details - Prepaid/Collect

Infraction Details | ASN Integrity

Reason Description

No ASN for

receipt DC

An error-free ASN was not available for

receiving at the DC.

No ASN for

receipt Store

An error-free ASN was not available for

receiving at store.

ASN received

late DC

An error-free ASN was received after physical

receipt of merchandise at specified DC.

ASN received

late Store

An error-free ASN was received after physical

receipt of merchandise at specified store.

Infraction Details Screen| ASN Example

Infraction

Description

Infraction Details

Status

Change

Submitting An Appeal | Appeal Guidelines

The DPS application provides users with the ability to attach

the following documents to an appeal:

• Word Document

• Excel Document

• PDF Document

• .JPG

• Outlook E-mail Message

Notes:

•Attachments must be less than 1 MB in size and the file name

cannot contain spaces.

•Submitted appeal information including attachment must

pertain to infraction to warrant review.

Submitting An Appeal | Appeal Guidelines This document should be referenced when submitting appeals. It is

available on the extranet and in the DPS Help section.

Vendor Appeal Matrix**

Subjec

t

Compliance Reason Mandatory Appeal Documentation

ASN NO ASN FOR RECEIPT

1. Reason for Appeal

2. ASN ID (BSN02) from transmitted ASN

3. Date ASN Transmitted

4. Date Functional Acknowledgement Received

ASN ASN RECEIVED LATE

1. Reason for Appeal

2. ASN ID (BSN02) from transmitted ASN

3. Date ASN Transmitted

4. Date Functional Acknowledgement Received

ETADELIVERY NON-COMPLIANCE

(PREPAID)

1. Reason for Appeal

2. Appointment Request form faxed to TRU that should contain

date sent and preferred delivery date or Carrier tracking data

showing date appointment request submitted.

3. POD if Parcel Shipment (example: UPS)

ETAFILL RATE NON-COMPLIANCE

(PREPAID)

1. Reason for Appeal

2. TRU DC signed Bill of Lading (POD)

3. Packing List

ETADELIVERY NON-COMPLIANCE

(COLLECT)

1. Applicable request # from VRTS system. (not routing id)

2. Date of routing request.

3. Date load available for pickup.

ETAFILL RATE NON-COMPLIANCE

(COLLECT)

1. Applicable request # from VRTS system.(not routing id)

2. Date of pickup.

3. Collect driver signed BOL.

4. Packing List

Submitting An Appeal Once the decision is made to appeal, an appeal may be submitted by

simply clicking on the appeal button on the Infraction Details Screen.

Submitting An Appeal Once on the appeal screen the proper appeal information can be

entered. An attachment can also be added by clicking “Browse”. Click

“Add Appeal” when ready to submit.

Submitting An Appeal After clicking on “Add Appeal”, the appeal confirmation screen will display.

The navigational links on this screen will allow you to search infractions,

search appeals or to return back to the infraction list to continue appealing.

Submitting An Appeal Best Practice Alert: A mass appeal may be submitted at the

order level or order/shipment level when a large number of

infractions exist.

Mass Appeal Selection Criteria

Order Level Mass Appeal

1. Purchase Order Number

2. Reason

3. “Reviewed” Status

Order/Shipment Level Mass Appeal

1. Purchase Order Number

2. Location

3. Routing ID/Appointment ID

4. Reason

5. “Reviewed” Status

Notes:

• Grouping of unrelated infractions through mass appeal will result in

an automatic rejection.

• If one infraction contains more than one shipment, the mass appeal

reason must apply to both shipments.

Submitting An Appeal On the dashboard page click on the “search infractions” link. Once on

the search infractions page the criteria from the previous slide can be

selected or entered depending on mass appeal type. When done click

“Search”.

Submitting An Appeal After clicking search the “Appeal All” button will appear. Normal

appeal steps apply after clicking “Appeal All” button.

Reviewing an Appeal Response Appeal responses can be viewed by returning to the dashboard

and clicking on the “Responded To In Last 14 Days:” Link.

Reviewing an Appeal Response The Appeals Detail Screen will provide users with the Vendor

Partnership response and an appeal status to identify whether the

infraction was rejected or accepted.

Status

VP Response

Reviewing Chargeback Detail In order to view chargeback detail from our program you must go to

the search infractions page. On that screen a user may perform a

search to review chargeback infraction detail.

Enter CB ID

Click Search

SummarySession Objectives

Delivery Performance System

Access & Workflow

Infraction Types

ETA Management Program Overview

ASN Integrity Program Overview

Workflow Demonstration

Dashboard

Reviewing Infractions

Submitting Appeals

Reviewing Statuses