Walmart Inc WMT's new initiative of stocking a consumer's fridge with items they purchased online should ring a bell as it is similar to what Amazon.com, Inc. AMZN announced in 2017, Loup Ventures' Andrew Murphy and Gene Munster wrote in a blog post.
What To Know
Amazon's new InHome Delivery will see delivery workers help themselves into a consumer's home to deliver items. This may seem like a smart move to copy Amazon's Key service, but Murphy and Munster argued this is a mistake.
Walmart needs to focus on doing what it can do best: leverage its large store count to create a supply chain to rival Amazon.
Why It's Important
If Walmart were to close 5% of its stores over the coming years, it will be left with 3,950 core Walmart and Sam's Club stores with an average size of 150,000 square feet. By comparison, Amazon makes use of just 150 fulfillment centers although they are large at 725,000 square feet.
Walmart needs to just re-purpose 800 locations or 20% of its base to function solely as a hub for last mile delivery capabilities, the venture capitalists wrote. Walmart appears to be moving on this initiative after closing 63 Sam's Club locations and transforming 12 of them to online fulfillment centers. To succeed, Walmart needs to "triple down."
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