High-Tech Fulfillment Centers Will Speed Up Walmart Deliveries

June 18, 2022

High-Tech Fulfillment Centers Will Speed Up Walmart Deliveries

Retail juggernaut Walmart, based in Bentonville, Arkansas, announced it will open four new fulfillment centers across the U.S. over the next three years to help speed up the picking, packing and shipping of online orders. Company Management deems the move essential in order for the retailer to keep up with consumers’ growing interest in online shopping and their expectations for next-day or two-day delivery.

Amazon, Walmart’s larger rival, is responsible for raising consumers’ expectations, largely through their Prime membership program. For an annual fee, Amazon Prime provides members the ability to browse a vast assortment of products online and enjoy expedited shipment of their orders.

A key strategy that Walmart is employing to combat Amazon involves leveraging its vast network of physical stores to grow its e-commerce business. More than three-quarters of Walmart’s stores currently fulfill online orders. Plus, the company already operates 31 facilities that fulfill online orders. But these four new high-tech fulfillment centers will be very different.

Employees at existing fulfillment centers must walk many miles each day picking items off shelves and carrying the goods back to their packing stations. In contrast, in these new fulfillment centers, an automated system will retrieve products off storage shelves and deliver them to a packing station, where an employee will load them into a box that’s custom-made to fit all the goods on that particular order.

The new system, tested and proven at Walmart’s Pedricktown, New Jersey fulfillment center, will first roll out this summer in Joliet, Illinois and occupy 1.1 million square feet. Others will follow in in McCordsville, Indiana (2.2 million square feet in spring, 2023); Lancaster, Texas (1.5 million square feet, 2023); and Greencastle, Pennsylvania (1.5 million square feet, 2024). Walmart says it plans to hire 4,000 new employees across the four facilities, earning hourly wages at the high end of the $16-to-$28 range paid to current warehouse workers.

In a blog post, David Guggina, Walmart’s Senior Vice President of Innovation and Automation, explained how these new high-tech fulfillment centers will expand the company’s ability to serve consumers more speedily: “These four next generation FCs alone could provide 75% of the U.S. population with next- or two-day shipping on millions of items. Combined with our traditional FCs, we can reach 95% of the U.S. population with next- or two-day shipping, and by making use of the expansive reach of our stores, we can offer same-day delivery to 80% of the U.S. population.”

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