Walmart plans to expand fulfillment services for Marketplace sellers

Dive Brief:

Walmart is looking to invest more heavily in its fulfillment service for third-party sellers on its Marketplace, Walmart eCommerce U.S. CEO Marc Lore told audiences in an appearance at the Recode conference last week.
To increase Walmart Marketplace's competitiveness relative to other retail giants — Amazon in particular — the focus going forward will include improving delivery and fulfillment times, Lore told Recode attendees.
Lore's statement echoed his remarks on the company's Q2 earnings call in August. "We have been dramatically improving the seller and customer [Net Promoter Score on Marketplace]," he told reporters. "And we feel like we’re in a really good position now to invest more aggressively in that area, given the improvement we’re seeing." He added on the call that "fulfillment by Walmart is one of the areas we’re actively looking at right now." Yet the company is not discussing when some of these improvements may be rolled out.

Dive Insight:

Sellers have the option to work with their own existing fulfillment centers, or go through a Walmart "fulfillment partner." Currently, the retailer prompts sellers interested in offering two-day delivery to select Delivrr, Walmart's third-party partner of choice, which offers specially discounted fulfillment rates.

"We've pushed on speed and we've got a lot more assortment but that's not going to be how we win," Lore said at the Recode event of the retailer's overall e-commerce strategy. Lore continued to say the best way for the company to compete against Amazon is to leverage the assets that are unique to Walmart, such as its nationwide brick-and-mortar retail footprint.

Walmart recently announced it is expanding its grocery delivery service, Delivery Unlimited, nation-wide, offering free grocery, bakery and select consumable items delivery for a $98 yearly or $12.95 per month fee. At Recode, Lore said the company is hoping to expand these offerings to additional merchandise categories in the future.

Currently, the Marketplace seller default is a "Free Value" shipping option which delivers items between 3-7 days. Sellers can set their own prices for more expedited one and two-day options, even offering them for free. However, fulfillment, even for a next-day item, can take up to four days, according to Walmart's website. For a Free Value item, it can take up to 10. Sellers are encouraged to build "fulfillment lag-time" into their schedules.