Walmart is responding to a surge in online orders by focusing on new proprietary technology
According to Walmart, six times the number of customers placed delivery orders in the fourth quarter of 2021 as did pre-pandemic
Walmart is responding to a surge in delivery orders by focusing on last-mile innovation, including a new proprietary technology platform.
In a new corporate blog post, Walmart details the many steps it is taking to utilize innovative solutions and strategies across the enterprise to enhance “last mile” (the part of the supply chain where packages travel from a pickup center to their final destination) delivery performance.
According to Walmart, six times the number of customers placed delivery orders in the fourth quarter of 2021 as did pre-pandemic. Over the last two years, the retailer has taken a number of steps to reduce the distance deliveries travel to customers while also increasing convenience for shoppers.
Following are highlights of Walmart’s last-mile delivery innovation efforts in several key areas of the enterprise.
Artificial intelligence
Walmart has built a tech platform that powers its last-mile delivery ecosystem. Agnostic to supply and demand, and built around its own marketplace, the platform uses automation and machine learning to turn a near-infinite number of factors into usable data. As it learns through artificial intelligence (AI), the platform is designed to improve.
“Our new platform is doing revolutionary things,” said Srini Venkatesan, executive VP for Walmart Global Tech. “With all these disparate points of delivery in a sense ‘communicating’ with one another, we can plan replenishment at a shorter cycle, gain close-to-real-time insights of inventory and ultimately react to customer demand. All of that adds up to a single stellar shopping experience for Walmart customers.”
Transforming stores
Having 4,700 Walmart stores across the country, located within just 10 miles of 90% of the U.S. population, the retailer utilizes its stores as pickup and delivery hubs, and increased pickup and delivery capacity by 20% during 2021. In 2022, Walmart plans to boost store pickup and delivery capacity by another 35%.
During the past year, Walmart increased the number of orders coming from its stores by 170%, which has led to a new automated store fulfillment model called market fulfillment centers (MFC).
Initially piloted at a Walmart supercenter in Salem, N.H. in mid-2019, an MFC’s inventory is separate from the store’s. s a compact, modular warehouse built within or added to a store. The centers can store fresh and frozen items, as well as thousands of other high-volume products. Instead of an associate walking the store to fulfill an order from our shelves, automated bots retrieve the items from within the center. The items are then brought to a picking workstation for fast order assembly.
While the system retrieves a customer delivery or curbside order for assembly, a personal shopper handpicks fresh items like produce, meat and seafood, as well as large general merchandise from the sales floor. Once the order is collected, the system stores it until it’s ready for pickup. According to Walmart, the whole process can take just a few minutes from the time the order is placed to the time it’s ready for a customer or delivery driver to collect. Orders can be picked up or delivered within the hour.
Convenient delivery options
Walmart’s focus on delivery convenience includes scaling up its Walmart InHome service. Launched in 2019, Walmart InHome delivers fresh groceries, everyday essentials and other products directly into customers’ homes, including placing items straight into their kitchen or garage refrigerator. The service also provides pick up for Walmart.com returns.
The retailer is scaling this service to 30 million U.S. homes and hiring 3,000 additional associates to operate an entirely electric fleet of delivery vehicles. Walmart is also partnering with home delivery technology startup HomeValet to offer customers at select Florida locations the option of having their deliveries from Walmart’s InHome service placed outside their home in a HomeValet SmartBox, with 24/7 availability.
The temperature-controlled, secure and Internet-connected box enables unattended delivery of fresh groceries and packages directly to consumers' front steps (or wherever they place the box.) It has an uncooled side and a temperature-controlled cooler side with sections for fresh and frozen items.
And the company’s Spark Driver network, a proprietary delivery platform that connects drivers to opportunities, is powering Walmart GoLocal, which the retailer introduced in August 2021 to deliver goods to customers of other businesses.
Autonomous vehicles
In the past few years, Walmart has been actively piloting different autonomous vehicle technologies as a means of delivering online grocery orders. In November 2021, Walmart made history by using multi-temperature autonomous box trucks from Mountain View, Calif.-based startup Gatik to move online grocery orders from a fulfillment-only dark store to a nearby Walmart Neighborhood Market store in its headquarters city of Bentonville, Ark., without a human safety driver.
In January 2019, the retailer initiated a pilot of home grocery delivery with autonomous vehicle company Udelv in Surprise, Ariz. In Nov. 2018, Walmart partnered with Ford Motor Co. and Postmates to test self-driving vehicles to deliver fresh groceries.
November 2021 also saw Walmart launch drone delivery operations at three stores in Northwest Arkansas, following several other drone pilots.