The Food Shippers of America Blog

Walmart: Food Chain Snapshot

by Staff, on Jun 6, 2022 9:30:00 AM

HubSpot Video

Source: Walmart

Walmart, like other retailers, continues to expand its delivery operations to help customers get the items they need when they need them. From Express delivery (where customers can have items delivered to their doorsteps in as little as two hours) to InHome (where they can get those orders placed right into their refrigerators) Walmart is offering customers multiple options that help them save time and money.

Two recent developments in home delivery by the retailer giant involve drone delivery and online white-label delivery – and the food chain industry is taking note.

Drone Delivery to Bring Convenience to 4 Million U.S. Households

Over the past year, the mega-retailer has been working on home delivery via drone. Walmart recently announced DroneUp delivery network to 34 sites by the end the 2022, providing the potential to reach 4 million U.S. households across six states – Arizona, Arkansas, Florida, Texas, Utah and Virginia. This provides Walmart the ability to deliver over 1 million packages by drone in a year – including food products.

Between the hours of 8:00a and 8:00p, customers can order from tens of thousands of eligible items for delivery by air in as little as 30 minutes. For a delivery fee of $3.99, customers can order items totaling up to 10 pounds.

“While we initially thought customers would use the service for emergency items, we’re finding they use it for its sheer convenience, like a quick fix for a weeknight meal,” says David Guggina, Walmart’s SVP of Innovation and Automation. “Case in point: The top-selling item at one of our current hubs is Hamburger Helper.”

Participating stores will house a DroneUp delivery hub inclusive of a team of certified pilots, operating within FAA guidelines, that safely manage flight operations for deliveries. Once a customer places an order, the item is fulfilled from the store, packaged, loaded into the drone and delivered right to their yard using a cable that gently lowers the package.

GoLocal Expands Delivery to 1,600 Locations

In addition to home delivery by drone, Walmart GoLocal, the retail giant’s white-label delivery service now is delivering from 1,600 retail and business locations in the United States as it expands its customer base, according to President and CEO Doug McMillion on a recent earnings call.

This volume is up from nearly 1,000 service pick-up points he noted on an earnings call in February. At that time, McMillion predicted GoLocal to end this year close to 5,000 locations – an aggressive goal, to be sure. Adding more delivery locations is expected to spur more volume for the retailer, a critical component to its strategy of making this evolving service more efficient and sustainable as it competes with other same-day delivery retailers.

“This is good for customers, our clients, and for us as we lower the cost per order by increasing the combined order size and the route density,” says McMillion of Walmart GoLocal’s service expansion.

GoLocal also is pursuing new customers, including mid-sized and independent grocers, by linking up with platforms that help retailers fulfill last-mile deliveries. For example, in February Cognetry Labs (a company that helps grocery retailers compete with the largest retailers in omni-channel) engaged with GoLocal as a provider. In March, GoLocal secured a contract with Delivery Solutions, which offers same-day delivery providers such as DoorDash (which serves thousands of restaurants, grocery stores, and convenience stores), Shipt (which provides same-day delivery for major food shippers like Costco Wholesale, HyVee, Meijer, Target, Winn Dixie, and Walgreens), and Instacart(which is a leading retail enablement platform that works with grocers and retailers like Kroger, Publix and Wegmans to transform how people shop).

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