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Walmart Fulfillment is a Closed Game

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And now Walmart. This week Walmart introduced Walmart Fulfillment Services an offering to select marketplace sellers to store, pick, pack, ship, return and service.

Not a surprise, and a very smart play for Walmart. They continue to go head-to-head with Amazon in marketplace, grocery and now fulfillment. But to the rest of retailers, this is another closed fulfillment network that boxes out anyone who dares to play in the game of convenience, cost, and speed. Now, any brand trying to win over customers or, even more importantly, retain those they have must contend with two behemoths.

Walmart can afford to build the massive networks laid out by Amazon. But as I have said many times before, the rest of the market cannot invest the dollars to monetize delivery, leaving an imbalance in the market. Basically, brands either sell on these marketplaces and lose customers, data, cross-sell and upsell opportunities while paying high margins or risk falling behind.

So how can Brands today content and make the last mile economically viable? It is automation, network optimization or warehouse and fulfillment center placement?

All of these are strong tactics and should be considered. The real impact, however, will come from orchestrating every logistics resource.

Last-mile logistics are incredibly complex, often involving up to a dozen different steps or teams, each dependent on the previous step or team. However, when you connect and digitize every one of these processes, automation and optimization become a data-intelligence game.

Think of it as a game of football. When every player executes the play in perfect sync, the quarterback can make split-second, informed decisions, selecting the best option and running the play. When brands achieve this orchestration model at scale, it puts them in the quarterback’s spot, giving them the insight, automation, and algorithms to maximize their existing supply chain resources so they too can monetize delivery.

Now take this one step further. If all resources were open, shared and connected, brands would be able to tap into a network at scale immediately. Pooled resources and shared best practices would elevate everyone’s business offering with the same level of fulfillment service that is accessible, usable and valuable to everyone.

This is what we need to strive for together as a market, and the imperative is now with yet another closed network creating an even larger par for Walmart.


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