There are few areas of retail where Walmart hasn’t entered. From a wide variety of products to in-house services like banking, restaurants, and even automotive repair, the store is constantly expanding its reach.
The retail giant’s next step could be focusing on a grocery delivery business, a risky but potentially beneficial choice that would be one of the first of its kind.
Several grocery delivery operations have tried their luck throughout the years, but few of them have the type of resources needed to succeed.
While the retail juggernaut’s dominance has been a subject of controversy, they’ve continued to top lists for sales, growth, and continued progress. Their grocery department was a major addition to a large portion of locations, and branching into the delivery market will present new challenges.
The company’s original trial began in Phoenix, and recently made its way to Tampa. The delivery system was tested at five locations in each market. Eight stores in Dallas will participate, as will four in Orlando.
The system will utilize the same website as Walmart’s grocery pick-up service. Helping shoppers save time and avoid the clutter of packed aisles has proven to be an effective strategy. The company’s delivery option has been handled largely through a working relationship with Uber.
The ride-sharing pioneer made waves in public transportation and more recently business-related travel planning with their Uber for Business platform. The decentralized model is the perfect way to get drivers for the testing phase of such a bold new model.
The delivery service, like the pickup option, will require a minimum payment amount of $30. There is also a $9.95 fee for delivery. Walmart hasn’t commented on how the fees are being handled with Uber. They’ve also released very little data about the success of their tests, only noting that their e-commerce sales as a whole were doing well.
If Walmart’s grocery delivery business proves to be a hit, it could be a major step in an evolving approach to retail. Centralization is becoming a thing of the past, and customer-centered solutions are becoming the norm.
However, this trend has led to other competitors entering this market. Walmart isn’t the only retail giant attempting this model – Amazon has also put plans into motion for their own grocery delivery business. The digital kingpin recently spent $13.7 billion to acquire Whole Foods, giving them a substantial amount of resources to jumpstart their own projects.
Amazon would also have the resources to use their own delivery and pickup services if things continue at the current rate. Amazon’s online services surpassed even Walmart’s online store. Branding goes a long way when it comes to breaking into new markets. Buyers are more likely to trust a name they know than a name they don’t.
For companies like Amazon and Walmart, success in these markets is not just possible – it is very likely. With Uber backing their efforts, Walmart will have the affordable workforce it needs in terms of delivery drivers. Their ability to leverage other resources properly will be key for long-term success.