Walmart is offering to handle fulfillment for third-party orders on its marketplace
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The retailer introduced Walmart Fulfillment Services (WFS), which will enable sellers on its e-commerce marketplace to pay Walmart to take care of the logistics of sales conducted through Walmart Marketplace, rather than working with a third-party service or handling orders themselves, per CNBC.
WFS is available to sellers throughout the US and takes care of picking, packing, shipping, delivery, returns, customer service, and more. This service may be Walmart's answer to Amazon's own logistics program, Fulfillment by Amazon (FBA), although FBA's services are not exclusive to sales through Amazon's marketplace.
The introduction of WFS could help Walmart attract more merchants and gain greater control of its marketplace, bolstering its e-commerce business in the process.
WFS could bring more merchants to Walmart's marketplace because it may simplify selling with Walmart. Over half (55%) of the 1,000 US brands surveyed by Feedvisor sell on Amazon, while 30% sell on Walmart.com, and only 40% of brands that sell on Amazon also sell on Walmart.com.
This may indicate that Walmart's e-commerce selection is well behind that of Amazon, potentially costing Walmart sales if consumers turn to Amazon for its breadth of products. WFS should help Walmart recruit more merchants to sell on Walmart.com, especially smaller sellers that may lack the resources needed to take care of logistics, since it can allow sellers to focus on their own products and businesses by turning over the entire fulfillment process to WFS.
And by controlling the fulfillment of Walmart.com orders itself, Walmart can create a better and more consistent experience for consumers that could boost sales. If a number of merchants sign up for WFS, many orders from Walmart.com will have the same delivery and returns process, offering consumers a familiar and consistent experience and enabling Walmart to oversee the quality regardless of which merchant makes the sale.
Additionally, merchants in the 48 contiguous US states that sell through WFS will be able to offer guaranteed two-day delivery through Walmart's distribution infrastructure, and as Walmart tries out faster delivery options to keep up with Amazon and other competitors, controlling more of its fulfillment should make it easier to offer them widely and potentially attract consumers interested in speedy delivery.
Walmart appears to be trying to create a more consistent experience online - something it's also doing across channels as it combines its online and in-store product buying teams. Merging the two teams could make Walmart's online and in-store pricing of products the same since they'll be handled by the same team, giving consumers a similar experience wherever they shop with Walmart.
This functions similarly to WFS giving Walmart.com consumers a familiar fulfillment experience no matter which merchant they buy from, and unifying all of its processes could make Walmart a more attractive shopping destination and raise both its e-commerce and overall performance.
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