Walmart is now encouraging third-party sellers to fulfill products sold from channels outside its own online marketplace .
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During its Marketplace Seller Summit in San Francisco on Tuesday, the company unveiled its new Multichannel Solutions program, which will allow sellers already using Walmart Fulfillment Services (WFS) to fulfill orders from any e-commerce site via Walmart’s supply chain.
Walmart will launch the program on Sept. 10, which will enable merchants to store and fulfill orders from the company’s warehouses at fulfillment costs they claim are 15 percent lower than competitors. The retailer also can manage returns for third-party sellers from any sales channel.
Sellers using the service can choose between an expedited shipping option of two business days and a standard shipping option of three to five days.
Walmart said it would fulfill online orders placed through other platforms using plain brown boxes rather than Walmart-branded packaging.
There are still some limits to which sellers are eligible. Sellers must be able to ship to one of 11 facilities throughout the U.S. Multi-box items are currently not eligible.
The company’s advance is yet another decision to compete directly with Amazon on the logistics front. WFS itself serves as the retailer’s analogue to Fulfillment by Amazon (FBA) , in that both enable third-party sellers to store goods in their warehouses, where both retailers’ employees do the picking, packing and shipping. Additionally, both services are tied directly with premium services including Amazon Prime and Walmart+, enabling sellers to offer perks like free shipping.
But the new Multichannel Solutions service now brings Walmart head-to-head with Supply Chain by Amazon , the end-to-end service that enables sellers to offload their logistics needs onto the tech titan—whether it be inventory storage and replenishment, ground transportation and delivery—even if the goods aren’t sold on Amazon.
Expanding these services has been lucrative for Walmart, with the company revealing in a second quarter earnings call that sales growth from the online marketplace and WFS has grown more than 30 percent in each of the past four quarters. Growth from Marketplace sellers using the fulfillment services increased 8 percentage points in the quarter.
Walmart has more than 420 million products on its marketplace and more than 100,000 active sellers, over a third of whom are based in China, according to research firm Marketplace Pulse .
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Sellers are flocking to Marketplace at a double-digit pace, according to chief financial officer John David Rainey, who said more than 40 percent of Marketplace sellers leverage WFS.
Jaré Buckley-Cox, vice president of WFS, said during the summit that the number of top Walmart Marketplace sellers using the fulfillment services is even higher at roughly 66 percent.
Data from Marketplace Pulse indicates that while 25 percent of marketplace volume was flowing through WFS three years ago, that figure has since ballooned to more than 50 percent. The firm estimates that more than 90 percent of Amazon sellers use FBA, but noted that the service has been operating since 2006. For comparison, Walmart introduced WFS in February 2020.
The new offering complements the retailer’s recent introduction of another logistics service for third-party sellers called Walmart Cross Border .
Within that offering, Walmart partner sellers that manufacture or source their goods in China can get full container loads delivered to designated U.S. ports, where the retailer will take over the remaining transportation, fulfillment and inventory management processes.
It appears that Walmart is looking to keep a closer ear to the ground in China, with the company offloading its stake in Chinese e-commerce giant JD.com for $3.6 billion to instead focus on its own core operations of Walmart China and Sam’s Club.
Alongside the new fulfillment perks and cross-border logistics services, Walmart is offering sellers using the Walmart Preferred Carrier program access to less-than-truckload (LTL) and full-truckload (FTL) shipments at discounted rates through carriers vetted by the retailer.
Additionally, the company is waiving peak season storage fees for sellers who inbound their inventory to WFS fulfillment centers through Sept. 30, giving them more incentive to get holiday product into Walmart’s logistics network earlier. For those that don’t, peak season storage fees will start Oct. 1.
Similar to Amazon establishing a deadline for third-party sellers to get Black Friday products into their warehouses by Oct. 19, the move is a recommendation by Walmart to send inventory into their facilities in August and September. Amazon’s peak season fulfillment fees will apply Oct. 15.
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