In the battle of retail dominance, Walmart figures it has one thing Amazon doesn't -- lots of stores and even more employees.
CEO Marc Lore says the company plans to leverage that advantage, announcing a plan for online orders to be delivered by Walmart store associates on their way home from work. The idea is to get packages delivered to customers sooner and cheaper.
Writing in the company blog, Lore says the system could cut shipping costs and get packages delivered faster, creating a win-win for both customers and associates, who will be paid extra if they volunteer to participate.
"It just makes sense," Lore writes. "We already have trucks moving orders from fulfillment centers to stores for pickup. Those same trucks could be used to bring ship-to-home orders to a store close to their final destination, where a participating associate can sign up to deliver them to the customer’s house. The best part is this gives our own associates a way to earn extra income on their existing drive home."
Lore makes clear that associates are not required to become delivery personnel on their commute home. If they choose to "opt in," he says the company has developed technology to allow personnel to set preferences to select how many packages they deliver, the size and weight limits, and the days when they are available to make deliveries.
Cutting 'last mile' delivery costs
Lore points out that Walmart has 4,700 stores in the U.S. and more than one million associates. Estimates show that there is a Walmart store within 10 miles of 90% of the U.S. population. This unusual delivery system, he says, cuts costs on the "last mile" of the delivery process, the most expensive part, that is currently filled by commercial delivery firms like Fed Ex and UPS.
It might be a while, though, before someone in a blue vest drops off a package at your door. Lore says the idea is being tested in just three stores -- two in New Jersey and one in Northwest Arkansas.
The move follows a Walmart plan to boost its online sales, in response to Amazon's growing dominance in that space. The company has already offered discounts on numerous items if they are purchased online.