Walmart wants employees to make more last-mile deliveries

Walmart plans to have employees make more last-mile deliveries, according to President and CEO Doug McMillon.

Walmart is revisiting its strategy of tapping into its workforce to fulfill online orders, marking a significant shift in response to the exponential growth in e-commerce activities. The move comes as retailers across the board are enhancing their capabilities in fulfillment and delivery services due to the substantial surge in online shopping, a trend that gained momentum during the COVID-19 pandemic.

Walmart originally dabbled with this approach in 2017, when it initiated a pilot program testing the utilization of its in-store employees to handle deliveries of online orders. In this initial iteration, employees had the option to volunteer for delivery duties after completing their regular shifts, offering them additional compensation for their efforts.

However, the experiment was short-lived, and Walmart quietly discontinued the program in 2018. One of the primary reasons cited for its cessation was the reluctance of employees to use their personal vehicles and rely on their personal insurance policies for deliveries, as reported by Reuters.

The landscape has dramatically shifted since then, with online ordering activity reaching unprecedented levels. Walmart, in particular, has witnessed a remarkable surge in store-fulfilled delivery sales, which nearly tripled over a span of two years. This surge was revealed by Walmart’s CFO and Executive Vice President, John David Rainey, during an earnings call in February.

Walmart’s commitment to bolstering its fulfillment and delivery capabilities is evident through its InHome delivery service, which was introduced in 2019 and has seen steady scaling since. This service employs specialized associates trained to perform home deliveries of groceries and handle Walmart returns. The process involves the use of one-time access codes, synchronized with smart access technology, to ensure seamless and secure deliveries within customers’ homes or garages.

While Walmart has heavily relied on the services of its Spark Driver platform, comprising thousands of independent contractors, to fulfill numerous orders, the company recognizes the need for expanded capacity. This requirement is particularly pronounced as Walmart continues to expand its local pickup and delivery services and onboard new customers for Walmart GoLocal, its white-label delivery service.

Even a relatively small percentage of Walmart’s vast associate workforce participating in the delivery process could yield substantial improvements in the retailer’s delivery capabilities. To provide context, as of January 31, Walmart employed approximately 1.6 million associates across the United States.

Walmart’s renewed interest in its employee-delivery model underscores the company’s commitment to staying competitive in the evolving landscape of e-commerce and last-mile delivery. By leveraging its existing workforce and embracing new approaches, Walmart aims to further enhance its ability to meet the surging demand for online shopping and streamline its delivery operations.

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