Walmart opens in-store robotic e-Commerce center
Within three years, by the end of its fiscal year 2026, Walmart said it expects about 65% of its stores will have automation capabilities, 55% of its fulfillment center volume will move through automated facilities, and unit cost averages could fall by some 20%.
Walmart Inc. will open a high-tech, in-store fulfillment center on Monday in Bentonville -- its first such center in Arkansas and its second in the U.S.
The company said in a news release Friday that the Market Fulfillment Center is built inside Store 100 at 406 S. Walton Blvd. It will use Walmart's proprietary Alphabot storage and retrieval system.
"Walmart's strategic use of technology to transform its stores aims to better the shopping experience for customers and open doors to opportunities for associates," the company said.
Walmart said it plans to open a mix of manual and tech-powered market fulfillment centers in coming years.
The Bentonville-based retailer has used Alphabot autonomous carts since at least 2019, when they were put to work in a New Hampshire Supercenter to store and retrieve items for online grocery orders. The bots were built by Alert Innovation, a robotics automation company.
Walmart agreed in October to acquire the firm it has worked with since 2016.
The retail giant expects that within three years, 55% of its fulfillment center volume will move through automated facilities, and a whopping 65% of its stores will be automated to some extent.
Speaking to investors and analysts at its recent annual investor’s meeting, executives reminded their audience that Walmart’s inventory sits within 10 miles of 90% of the U.S. population.
For decades the retail giant has staked its growth and profits on this vast brick-and-mortar network of what is now more than 5,300 locations, including 600 Sam’s Club warehouse stores. Despite the fact that it sees huge potential in e-commerce, and is targeting much of its investment to stoking online sales, that footprint remains crucial to its success.
To the extent that a brick-and-mortar fleet is an advantage, it’s not one available to Amazon, which has a much smaller footprint of much smaller locations, mostly Whole Foods. During the meeting, Walmart U.S. CEO John Furner called the company’s stores “the key nodes” in its omnichannel operation.
“That’s important because we know customers want speed,” he also said. “We also know that the last mile costs more than the middle mile, and the middle mile is more costly than the first mile. So having 4,700 points of distribution shortens the last mile, lowers the delivery time and lowers costs.”
In the next five years, nearly 90% of Walmart’s capital expenditures will be in “high return areas like e-commerce, supply chain, and store investments,” Chief Financial Officer John David Rainey said. Within three years, by the end of its fiscal year 2026, Walmart said it expects about 65% of its stores will have automation capabilities, 55% of its fulfillment center volume will move through automated facilities, and unit cost averages could fall by some 20%.
In recent days Walmart has notified several states of layoffs at many of its e-commerce facilities, which so far top 2,300. Executives Wednesday said they envision hiring more people in the long run, for better jobs at better pay for what will be a bigger, more profitable enterprise.
“Further scaling precisely these types of investments is what will allow us to realize a profit inflection in the next five years,” Rainey also said.
UBS analysts led by Michael Lasser also see it that way, saying that these “improved efficiencies should help it accelerate its flywheel.”
