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Walmart on Tuesday announced the launch of a delivery service called GoLocal, which will transport goods from other local retailers to consumers.
The company said it plans to start shipping by the end of 2021 and that the delivery fleet will include newer technologies, such as autonomous vehicles and drones.
“It’s about bringing the capabilities that we, as Walmart, have laser focused on creating and connecting our own customers to local and national business life,” Tom Ward, vice-president, told CNBC. -Senior President of Last Mile for Walmart.
Walmart has stated that GoLocal will be a white label service, which means deliveries will not be made by Walmart branded vehicles. The company said it will offer competitively priced shipping within two hours as well as a two-day delivery option. Deliveries will be handled by a combination of associates, gig workers and sometimes other delivery companies.
Walmart is currently in partnership with FedEx for online parcel delivery. The company wouldn’t say if FedEx would be used for GoLocal.
However, Ward said the company will use innovative delivery partners, including Cruise, an autonomous electric vehicle startup the retailer invested in last year, as well as Waymo and Nuro. Drone delivery will also be the focus, with partners like DroneUP, another company Walmart invested in last year, as well as ZipLine and FlyTrex.
“What we’re excited about is that as we expand this, we have all these different disruptive technologies that make it possible to work together on the last mile at Walmart,” Ward said.
Walmart has spent the past five years building its ability to deliver goods to customers. In August 2016, it acquired e-commerce startup Jet.com for $ 3.3 billion. In March 2018, Walmart launched its grocery delivery service, fulfilling orders from Walmart stores. The company launched Walmart Fulfillment Services in February 2020 to compete with the growth of market-driven sites such as Amazon and Shopify.
The company discontinued Jet.com in May 2020, but CEO Doug McMillon gave the acquisition credit for helping Walmart grow its delivery network.
Amazon launched a similar service, called Amazon Shipping, in 2018, designed to compete with UPS and FedEx, but suspended the service in June 2020.
Bernstein’s senior transportation analyst David Vernon said that a local delivery service by a retailer would likely not have a significant impact on FedEx and UPS revenues.
“The local delivery market is made up of 230,000 companies competing in every city in America,” Vernon told CNBC. “There are two national parcel networks. They overlap; business is shifting to some of these local businesses. But in the long run, it’s not exactly the same.”
Walmart said GoLocal already has contracts with a number of domestic retail customers and will begin accepting applications from new partners on Tuesday.
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