What is MABD?

What is MABD?

by Matt Brosious

What Does MABD Stand for?

(MABD)Must Arrive By Date refers to the date a supplier’s merchandise is expected to arrive at a warehouse, retailer’s store, or another facility. Depending on the company or retailer, MABD may be a window of days the shipment is expected or a specific date the shipment is expected. MABD is used for LTL and Full Truckload.

What Is the Purpose of MABD?

Big-box retailers primarily use MABD. They are holding suppliers accountable to MABD results in better inventory control. Housing excess inventory costs retailers money. The retailer’s goal is to receive merchandise when needed. This will all allow them to sell or distribute quickly. As a result, this minimizes the back-stock as much as possible. Reducing back-stock means reducing the clutter resulting in lowering the cost. Knowing the new inventory on a planned MABD, the retailer can better prepare for sell-through and control inventory levels.

How Is "Must Arrive By Date" Used In Retail Shipping?

Suppliers working with large retailers must comply with strict delivery and compliance regulations, one of the most common being the (MABD) delivery window. Retailers have implemented these tough delivery windows to increase the operational efficiency of their warehouse or distribution center operations. Retailers have also implemented the MABD window to minimize costs and inventory levels while maintaining product availability. With high customer expectations and demand, products must be delivered on time so that retailers can quickly get the product on the shelf. MABD sets a defined delivery window for when a shipment must arrive at its destination. Failure to comply and hit the required window can result in a significant penalty or chargeback. Giant retailers need high levels of accuracy and compliance to ensure products are available and on the shelf for consumer purchases.

MABD Concerns for Suppliers LTL and FTL

The biggest challenge for suppliers regarding MABD is compliance. The tighter the MABD window, the more opportunity for deliveries to be too late or too early. Many suppliers struggle to stay MABD compliant because of shipping options via LTL. The issue with LTL shipping is the number of stops. This creates delays and makes it harder for the supplier to remain MABD compliant. Suppliers shipping full truckloads to retailers have a much easier time complying with MABD. Full truckloads have one destination and can hit the MABD window easier.

Suppliers can reduce shipping spend by working with a 3PL shipping their products via LTL to retailers. Shipping LTL combines the supplier’s merchandise on one truck with inventory from various other suppliers. As a result, it creates a full truck arriving at a retail store or warehouse.

The MABD window

The MABD window is the period or day the product is expected at the distribution center. Most MABD windows detail a two to three-day time frame. It’s not just about being on time. Even delivering a shipment early Can be a problem. Having a load late can be even more detrimental. Imagine a shipment that does not arrive intact or is missing something during the required delivery window. In that case, the supplier may be charged a MABD OTIF penalty. OTIF means On Time In-full, and this fee is generally a percentage of the invoiced dollar amount. OTIF expectations have been raised almost yearly. Suppliers are measured on higher rates of times they hit the MABD and how much of the delivery is missing.

How Is ON TIME IN FULL (OTIF) Calculated?

Example with a 3% OTIF Penalty

  • On-time score = 100% (50 boxes received within compliance window)
  • In-full score = 90% (boxes received/cases ordered)
  • OTIF penalty = $0.15 (5 boxes short, $1.00/box multiplied by 3% penalty)

Where Can I find a freight Carrier that can Meet MABD Requirements?

Partnering with a MABD-approved or preferred freight company with experience shipping to big box retailers will help your business be successful. FreightCenter has lots of experience working with many of the largest retailers in the country. Customers now have more options than ever to purchase what they want and when they want it. They have the ability to shop brick-and-mortar or online. Most retailers want full shelves and warehouses to they can sell their merchandise. If the item isn’t there for the customer, retailers know the next store or website will have it and lose the sale. This is why the suppliers must get the merchandise to the retailer promptly. Supplier accountability is partially the efficiency of their supply chain. For the retailer, MABD holds the supplier accountable.

Final Conclusion

MABD creates a win-win-win for the consumer, supplier, and retailer

  • The consumer wins by getting a better system of inventory flow on the retailer’s and supplier’s part. This helps ensure the products they walked in the store to buy will be there when they want to purchase them
  • The supplier wins by knowing the retailer plans to accept the shipment and move it quickly.
  • The retailer wins by controlling inventory and thus reduces clutter and cost and keeps the shelves fully stocked.

Instant Truckload Rates
Pickup/delivery information
Shipment information
Do you know the freight class?
Let’s Get Started! Compare shipping rates in an instant!
Get a Freight Quote