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Supply Chain News: Walmart, Target Make eFulfillment Moves

 

Walmart Expanding New Express Service, while Target acquired Technology Assets from Failing Deliv

May 11, 2020
SCDigest Editorial Staff
     

The ecommerce and eFulfillment world, it seems, is one where the strong get stronger, making it very tough on everyone else.

Case in point: eFuflillment news last week from Walmart and Target.

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Target already owns on-demand delivery service Shipt, which it acquired in 2017 for about $550 million.


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First, as Walmart tries to keep pace or move ahead in some areas versus now archrival Amazon.com, especially in use of its stores to drive customer service and interaction, there were new reports that Walmart has launched a new service called "Express." With the service, customers can pay an additional $10.00 upcharge on top of regular delivery fees to receive Expedited home delivery.

The scenario: a flood of on-line orders for delivery from consumers locked down in their homes has led to long lead times for deliveries to occur and in some cases there are no delivery slots available for a given time window on Walmart.com.

The idea of the new Walmart Express: enable consumers willing to spend an extra 10 buck to move to the front of the line, like what some amusement parks offer to allow well-heeled guest to skip the long wait for rides.

"Express" has been in pilot testing across 100 Walmart stores in the US since mid-April. Walmart says it plans to expand the service to nearly 1,000 stores in early May and it will be offered in a total of nearly 2,000 stores in the weeks after, according to TechCrunch.com.

The service also requires a minimum $30.00 purchase, and supports basically all products found in the stores, some 160,000 items from across Walmart's grocery, consumables and general merchandise categories.

Though Walmart is officially promoting Express as a "two-hour" delivery service, in the weeks it's been piloting the program Walmart has been able to deliver these orders within 56 minutes, on average.

According to TechChrunch, in its own tests, regular, non-Express Standard delivery time slots often were not available for the current day or even several days out – but could be had as part of the expensive Express program.

Deliv Closing Doors, Target Buying Technology on the Cheap

In a rather surprising and rapid fall, ecommerce delivery firm Deliv announced last week it was ending operations in August – allowing Target stores to acquire some of its technology on the cheap.


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"Due to a confluence of events over the past few months, Deliv will unfortunately be winding down our operations over the next 90 days. The last day of service will be on or before August 4th, 2020," Deliv's founder and CEO Daphne Carmeli wrote in an email sent to its delivery workers last week.

The company offered same-day delivery on behalf of Best Buy, Macy's, Mercato, Walgreens and others retailers. It is not clear what happened, but many retailers have not been allowed to open for two months, and the cash drain may just have been too much for Deliv to survive.

And that means a lot of investment dollars are going down the drain. The firm has raised about $85 million in venture capital since its founding in 2012, according to PitchBook Data, which tracks such matters.

Those investors will it appears be getting a few dollars back from Target's move to acquire some of Deliv's technology.

Target already owns on-demand delivery service Shipt, which it acquired in 2017 for about $550 million.

Now, "Deliv is in the process of completing a deal to sell technology assets to Target and Deliv's CEO along with a subset of the team will be moving over to Target," a Deliv spokesperson last week.

The cost of those assets is small enough Target views it as non-material. NBC also says Target will not use the technology to try to maintain or gain business with other retailers outside its own fulfillment needs, even though Shipt continues to operate as a separate company.

Nevertheless, NBC News reported that while Target and its competitors are looking to speed up deliveries during the coronavirus pandemic, Deliv's technology won't be rolled out immediately. But it could be useful in Target's long-term efforts to transform its supply chain, according to the source.


Any reaction these moves by Walmart and Target? Let us know your thoughts at the Feedback section below.


 
 

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