What is going on here?
Walmart has announced new marketplace seller services aimed at boosting sales. sale Ahead of the holiday season.
What does this mean?
Walmart is stepping up efforts to take on e-commerce giant Amazon by introducing a slew of new services for its marketplace sellers. The retail giant now transports goods from Asia to its U.S. warehouses, fulfills orders and manages returns from all e-commerce sites. Additionally, it is offering cash advances to qualified sellers and waiving peak season storage fees for inventory sent to fulfillment centers by September 30. The initiative, announced at Walmart's annual Marketplace Seller Summit, is aimed at helping sellers prepare for the holiday shopping rush and Walmart's sales events that often overlap with Amazon's Prime Day in October.
Why should you care?
For markets: Holiday season celebrations for shareholders.
Walmart's focus on facilitating third-party sales could be a game changer for e-commerce. The company has aggressively added sellers, primarily from China, to its Walmart.com marketplace over the past year, driving marketplace sales growth of more than 30% annually over the past four quarters. This growth was a major contributing factor in Walmart's global e-commerce sales surpassing $100 billion last year. Additionally, its fulfillment service's shipping fees are on average 15% lower than competitors, positioning Walmart as a more cost-effective option for sellers looking to expand their reach.
The big picture: Strategic moves coincide.
Walmart's new service, announced on the heels of its stake sale in Chinese e-commerce giant JD.com, marks a strategic shift to handle more third-party sales in-house. With more than 420 million products on its marketplace and more than 100,000 active sellers, more than a third of which are based in China, Walmart is not only catching up with Amazon but also potentially setting a new standard for marketplace efficiency and seller support. These moves could have a lasting impact on global e-commerce dynamics as retailers prepare for a pandemic-affected holiday season in which online shopping will be key.