There’s a new player in the business of delivering retail orders over that challenging “last mile” — Walmart.
The company announced Tuesday that it is expanding its delivery service to handle shipments from other businesses, even local shops.
The last mile of delivery tends to be the most expensive “because it’s the hardest to get the most route efficiency, the most amount of revenue that you can get out of an entire delivery route,” said Vince Castillo, who teaches logistics at the Ohio State University
But Walmart has solved that problem in many rural areas, where it’s already making last-mile deliveries of its own products.
The company’s service announced today: “What it does is it allows them to be able to make more deliveries with the infrastructure they already have,” Castillo said.
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And for any businesses that might be uncomfortable with having their products delivered out of a Walmart van, the retailer is promoting GoLocal as what’s called a “white label” service. “Which means … someone coming up to your door is not going to have a Walmart shirt on,” said Cathy Roberson, president of Logistics Trends and Insights, a market research firm.
“It may be Betty’s bakery, you know, as a consumer receiving those baked items, or what have you, [and they may] have no idea that Walmart is behind this,” Roberson said.
Walmart will charge retailers for the service, but it will also get something else that’s incredibly valuable: data.
“Whether it’s understanding which neighborhoods tend to prefer certain products versus other products, or what time of day people tend to buy products, or which products are bought together,” said Tom Derry, CEO of the Institute for Supply Management. “So data becomes really critical and understanding consumer purchasing patterns and being able to better serve the consumer.”
And being able to better sell to the consumer.