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Walmart Leading The Retail Pack With Its InHome Delivery Service Model To 30 million Homes
January 5, 2022
June 3, 2022
Walmart is building warehouses with a high-tech spin in hopes of delivering items to customers more quickly and growing its online business.
The retailer said Friday it plans to build four new fulfillment centers that use automation to pack and ship online orders more efficiently, with the first location opening this summer in Illinois. For customers, the new warehouses will mean next-day or two-day delivery could be more common for items including cereal and T-shirts.
Automated system to bailout arduous manual processes
But at Walmart’s existing fulfillment centers, employees can walk nine miles or more a day to pluck items off shelves and lug them back to areas for packaging, said Michael Prince, Walmart’s vice president of supply chain innovation and automation.
That won’t be necessary at the new warehouses, where an automated system will retrieve items from an expanded storage space and shuttle it to an area where an employee packs it in a box, which will be custom made to fit the order’s measurements. Walmart tested the concept at a fulfillment center in Pedricktown, New Jersey.
Amazon, Kroger and others have also tapped automation to expand capacity and speed. A decade ago, Amazon acquired Kiva Systems, which created wheeled robots for its warehouses. It has tested robots to reduce strenuous jobs for workers and in April launched a $1 billion fund to invest in companies developing supply chain technologies.
Last year, Kroger began opening giant robot-powered fulfillment centers in the U.S. through a partnership with British online grocer Ocado.
Walmart said it will hire 4,000 people to work at the new facilities. The current starting pay at existing warehouses is $16 to $28 per hour and wages at the new ones will be at the higher end of that range, the company said. The retailer declined to share construction costs.
Walmart stores will still play a role in the company’s supply chain and handle online orders with popular items along with chilled and frozen groceries, Prince said. Fulfillment centers will handle orders with a broader assortment of products, including pantry staples and other dry groceries.
Other pieces of Walmart’s supply chain are getting a makeover, too. Dozens of stores are becoming mini automated warehouses for online grocery orders. And last week, Walmart said it will add robotics in coming years to its 42 regional distribution centers, which replenish store shelves.
