Walmart (WMT) has decided to offer its logistics services to third-party sellers to boost its Marketplace sales. The American big-box retailer announced the news at its 2024 Walmart Marketplace Seller Summit as part of several other initiatives. Importantly, Walmart Fulfillment Services (WFS) will allow sellers to deliver their orders from any e-commerce website using the company’s supply chain. WFS will even manage returns and deliver goods in unbranded packaging at competitive rates.
Walmart Expands Services to Attract Sellers
Walmart’s WFS will leverage its vast logistics network with advanced technology and supply chain management services to boost sales from independent sellers. The program is set to begin on September 10 to ensure a quick delivery experience in the crucial holiday season. Moreover, Walmart stated that it will offer logistics services at rates averaging at least 15% lower compared to rivals.
Furthermore, Walmart announced the launch of its Walmart Cross Border import service that will transport inbound goods from Asia directly to WFS facilities in the U.S. It is also offering third-party sellers the option to either ship a few items or a full truckload at competitive rates using the Walmart Preferred Carrier program. Other initiatives include cash advances of up to $5 million to eligible sellers and the peak season storage fee waiver for sellers who store their inventory at WFS centers before September 30.
Walmart’s Marketplace sales jumped over 30% in each of the last four quarters. The number of third-party sellers that registered on WMT Marketplace grew 20% in Fiscal 2023. Further, WMT’s global e-commerce sales crossed $100 billion in 2023, while the U.S. e-commerce business has registered double-digit growth for the past six quarters. However, these numbers still lag the mammoth figures that rival Amazon.com (AMZN) boasts with its dominance in the logistics space. With the latest initiatives, Walmart is bolstering its logistics business to better compete with Amazon’s fulfillment services.
Is Walmart Stock a Buy or Hold?
On TipRanks, WMT stock has a Strong Buy consensus rating based on 27 Buys versus three Hold ratings. However, the average Walmart stock price target of $74.11 implies 2.7% downside potential from current levels, as WMT shares have already gained 45.9% so far this year.
