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As part of their strategic relationship, Walmart and Rakuten have opened their first ecommerce store in Japan. We look at the model being used and implications for future expansion.

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Walmart is to build a new distribution centre using new technologies and automation.

A first for Walmart

The new distribution centre, which will be in California, will be the retailer’s first highly-automated facility. Working with WITRON, Walmart will process delicate or perishable products at the distribution centre, including fresh produce and eggs.

Using technology to enhance processes

When it opens in Q4 2020, the distribution centre will be able to process 40% more products than a standard warehouse. Walmart engineer, Shayne Wahlmeier, described how technology would ensure minimal waste and shrinkage at the facility: “Every product is measured and documented so that we know how to handle it. A computer algorithm shows all the cases ordered for a given store and determines how to palletize them to maximize the space on a pallet or trailer. It also takes into account density – what’s crushable, what’s not.”

We look at the latest initiatives from Walmart Canada, including mobile check-in and the launch of Pickup Towers.

1. Launching mobile check-in

With the expansion of its grocery pickup service to stores in Regina, Halifax, Moncton, Victoria and Quebec City, Walmart Canada has launched a mobile check-in service. Integrated into the retailer’s app, the service enables customers to notify the store 30 minutes prior to their scheduled grocery pickup time with a single tap. When the customer is close to the store, store associates are alerted, enabling them to have customer's order ready when they arrive. Walmart Canada will extend this service to all grocery pickup locations over the next year.

2. Testing Pickup Towers

The retailer is also set to test Pickup Towers at two locations in Ontario early next year. This follows on from their successful deployment in the US, where 700 are expected to be in place by the end of the year. The 16-foot-tall units are used to dispense online general merchandise orders in less than a minute, providing customers with quick and easy access. This initiative highlights how the retailer is aiming to integrate its stores and online operations.

3. Partnering for efficient ecommerce delivery and pickup

Recently, the retailer partnered with Spud.ca to use its Food-X food delivery platform to offer home delivery in Metro Vancouver. Food-X’s recently opened 74,000 sq ft warehouse facility utilises proprietary technology to enable a highly efficient delivery model for multiple retailers. This collaboration enables Walmart to better serve urban locations where it does not have a high density of stores. Earlier this year, it partnered with Penguin Fresh to open two co-branded pickup locations for online grocery orders in downtown Toronto.

A new home delivery service is to start in London, delivering groceries from Aldi stores. Home Run takes orders online, and uses personal shoppers to go into stores to pick the goods. The company then offers delivery to addresses in central London within 2 hours.

Last mile couriers

Home Run already fulfils orders from Waitrose, Marks & Spencer and Tesco, but it charges a premium on some product prices compared to the store, as well as adding on a delivery charge. Orders are delivered by couriers using car or scooter, and says the scooter drivers are “equipped with the biggest boxes that can be safely carried”.

Personal shopping across the pond

Personal shopper services are not widely used in the UK, but in the US they form a major part of the home delivery sector, especially to achieve express deliveries.

Walmart’s same-day delivery plans

To emphasise this, Walmart has announced the expansion of its partnership with Instacart offering same-day delivery from Sam’s Club stores. This partnership started in February 2018 and is now being rolled out to more than 350 clubs by the end of Oct, over half of the estate.

Partnering with Instacart

Instacart is a major “marketplace” operation in North America, and as it has more formalised partnerships with retailers, it has been able to offer shoppers the same prices as they would see in-store. It focuses on rapid (under two hour) deliveries in certain densely-populated areas, largely depending on independent contractors to shop and deliver.

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