NEW YORK — Walmart said Tuesday it will start farming out its delivery service, using contract workers, autonomous vehicles and other means to transport rival retailers’ products directly to their customers’ homes as fast as just a few hours.
What’s happening
The nation’s largest retailer said it will dispatch contract workers from its Spark delivery network, which was launched in 2018, to merchants’ stores to pick up items and then bring them to shoppers. During the past year, Walmart has doubled Spark’s coverage to more than 500 cities nationwide, providing access to more than 20 million households.
Walmart, which is based in Bentonville, Arkansas, aims to tap into its ties with local communities, particularly businesses in rural areas that have struggled to provide their own delivery services.
What it means
The strategy will pit Walmart against delivery services run by those including Uber and DoorDash. And it comes as Walmart moves to expand its sources of profits and revenues beyond its core retail businesses. It echoes Amazon’s diversification move with its Amazon Web Services cloud computing unit, which the online behemoth built for itself and now sells to other businesses.
Why it’s happening
The moves are happening as the pandemic has deepened shoppers’ appetite for speedier deliveries, putting more stress on smaller retailers that can’t meet their expectations. Walmart has been relying on DoorDash and other crowd-sourcing services as well as its own workers to serve its own customers. But it has also been expanding its Spark platform that until now has not delivered non-Walmart goods.
Walmart said the delivery service, Walmart GoLocal, has already signed a number of deals with national and small-business clients, although it did not name them.
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