Walmart is using a surprising strategy to execute on free, next-day shipping that doesn't involve any of its 4,700 US stores.
Instead, Walmart will fill next-day orders from its six US fulfillment centers. This is a cheaper and more efficient strategy than shipping orders from stores, according to Walmart ecommerce CEO Marc Lore.Each next-day order will ship from a single fulfillment center, which is cheaper than shipping orders in several boxes from multiple stores or distribution facilities, Lore told Business Insider. .
Walmart plans to further drive down the costs of next-day shipping by making"aggressive investments" in automation and boxing technology, and fulfillment centers are better equipped for those kind of investments, he said. Shipping from fulfillment centers also prevents stores from becoming crowded with order pickers and packers.
"Most of the picking capacity in the store is being utilized for same-day pickup and same-day delivery," Lore said.
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