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Russell Stover Candies, Inc. Vendor Compliance Policy

 

Russell Stover Candies, Inc.
Russell Stover Candies Vendor Compliance Policy
LAST UPDATED OCTOBER 2009

The information outlined below details what Russell Stover Candies expects from its vendors. The purpose of this updated policy is to communicate what is required to be a vendor and to help ensure on time delivery of acceptable supplies for our manufacturing process.

Our goal is to receive supplies, without defect, in a timely fashion to support our manufacturing facilities, while minimizing inventory.

In today's manufacturing environment, proper supply chain management must be in place to meet our customers more demanding terms. This Compliance Policy has been established to enable Russell Stovers and our Vendors to work together to optimize our supply chain and meet our end customer demands. The program identifies areas that can limit the success of proper supply chain management which results in lost manufacturing time and lost sales and profits for everyone. As a last result, chargebacks for non-compliance will be issued.

Please read all information carefully. Your company will be held to these standards. Russell Stover will automatically deduct for non-compliance using the attached form "Vendor Non-Compliance Credit Memo Request". Remittance advises will contain the corresponding deduction code against a purchase order.

Please note that Russell Stover Candies requires that all deliveries of items on pallets to be on New GMA 40x48 pallets. If you have any questions, you may contact the company at 816-842-9240.

A. Merchandise Receipts
Requirement Non-Compliance Action Effective Date
1. Shipment must ship on time or deliver on time, per RSC instructions. $500.00 per incident Nov. 1, 2009
2. Shipment must be received complete as ordered, or as approved by buyer in writing. $500.00 per incident Nov. 1, 2009
3. Amount shipped must fall within tolerance of 0% under- / +5% overrun to quantity ordered. Overage kept, amount invoiced + $500.00 processing run fee chargeback Nov. 1, 2009
4. Samples must be furnished of all display corrugate prior to shipment unless otherwise approved by the buyer. $500.00 fine per component invoiced Nov. 1, 2009

B. UPC Compliance
Requirement Non-Compliance Action Effective Date
1. UPC must be of proper quality and scan-ability. First occurrence: $ 2,000.00
Second occurrence: $ 5,000.00
Third occurrence: $ 25,000.00
Nov. 1, 2009
2. Scan result must match human readable information. First occurrence: $ 2,000.00
Second occurrence: $ 5,000.00
Third occurrence: $ 25,000.00
Nov. 1, 2009
3. Merchandise must not be marked with a UPC assigned to another item. First occurrence: $ 2,000.00
Second occurrence: $ 5,000.00
Third occurrence: $ 25,000.00
Nov. 1, 2009

C. Shipment Routing
Requirement Non-Compliance Action Effective Date
1. No unauthorized air shipment will be accepted by Russell Stover.

Freight difference + $200.00 processing fee chargeback

Nov. 1, 2009
2. Ship VIA correct mode of transportation according to weight, carton, linear footage guidelines and routing instructions provided by Russell Stover. Freight difference + $200.00 processing fee chargeback Nov. 1, 2009
3. Must not ship collect when prepaid terms. Freight difference + $200.00 processing fee chargeback Nov. 1, 2009
4. Shipments must be released with correct carriers as specified in routing guidelines. Freight difference + $200.00 processing fee chargeback Nov. 1, 2009
5. Shipments must be made from ship point stated on purchase order. Freight difference + $200.00 processing fee chargeback Nov. 1, 2009

D. Shipping Requirements
Requirement Non-Compliance Action Effective Date
1. Complete and accurate Certificate of Analysis must be received no later than shipment.

$200.00 processing fee chargeback

Nov. 1, 2009
2. Complete packing list must be provided with shipments as specified in shipping instructions. $200.00 processing fee chargeback Nov. 1, 2009
3. Bill of Lading information must be accurate. $200.00 processing fee chargeback Nov. 1, 2009
4. Carton size and weight must meet specifications. $1.00 per carton + $200.00 processing fee chargeback Nov. 1, 2009
5. Non-conveyable cartons must not be shipped without authorization. $1.00 per carton + $200.00 processing fee chargeback Nov. 1, 2009
6. Cartons must be sealed properly. $1.00 per carton + $200.00 processing fee chargeback Nov. 1, 2009
7. Carton corrugated must meet specifications. $1.00 per carton + $200.00 processing fee chargeback Nov. 1, 2009
8. Cartons must be received with proper markings, including core tags on roll stock. $1.00 per carton + $200.00 processing fee chargeback Nov. 1, 2009
9. All shipments must be on new 40 x 48 GMA hardwood pallets. $50.00 pallet fee + $200.00 processing fee chargeback Nov. 1, 2009
10. Shipment must be packed properly by vendor. This requirement includes using corrugated which meets specifications and properly protecting the product. $1.00 per carton + $200.00 processing fee chargeback Nov. 1, 2009
11. Shipment must arrive in acceptable condition. $1.00 per carton + $200.00 processing fee chargeback Nov. 1, 2009
12. Raw Materials or Pack and Wrap item for Sugar Free Product must contain the #347 Green Label on Carton. $1.00 per carton + $200.00 processing fee chargeback Nov. 1, 2009
13. Raw Materials or Pack and Wrap item for Low-Carb (Net Carb) Product must have Red Label on Carton. $1.00 per carton + $200.00 processing fee chargeback Nov. 1, 2009
14. Raw Materials or Pack and Wrap item for Calorie Smart Product must have Yellow Label on Carton. $1.00 per carton + $200.00 processing fee chargeback Nov. 1, 2009
15. Raw Materials or Pack and Wrap item for Diabetix/Sucratrol Product must have Orange Label on Carton. $1.00 per carton + $200.00 processing fee chargeback Nov. 1, 2009
16. Orders must be shipped in full carton quantities—no partial cartons. $1.00 per carton + $200.00 processing fee chargeback Nov. 1, 2009

E. Invoicing
Requirement Non-Compliance Action Effective Date
1. Incorrect Purchase Order number referenced on invoice. $200.00 processing fee chargeback Nov. 1, 2009
2. More than one Purchase Order number listed per invoice. $200.00 processing fee chargeback Nov. 1, 2009
3. Double Billing requiring additional time in research. $200.00 processing fee chargeback Nov. 1, 2009
4. Quantity variance i.e. between invoice and purchase order/receiver. $200.00 processing fee chargeback Nov. 1, 2009
5. Price variance i.e. between purchase order. $200.00 processing fee chargeback Nov. 1, 2009
6. Incorrect receiving location listed on invoice. $200.00 processing fee chargeback Nov. 1, 2009

F. Defective Material
Russell Stover Candies' continued success depends upon receiving raw materials and packaging that meet our specifications on a continuous basis. Suppliers to RSC will be held liable for all costs associated with shipping defective materials to us, including any costs generated in the administrative and legal activities of filing a claim.