Walmart supercenters can serve as new omnichannel fulfillment hubs Even if one buys into the arguments just discussed, both online grocery growth and more competition within the physical grocery space are still likely coming fast. Therefore, grocery stores, and Walmart’s supercenters are no different, do not need as much physical space in their stores as they did in the past to meet their customers’ needs. The smart move then is to reposition this space for other value creating activities, like hyperlocal microfulfillment, for example. Quickly, hyperlocal microfulfillment is the practice of collocating automated warehouse facilities within actual operating retail stores. The concept allows retailers to save money on picking and packing through automation and also allows them to save money on delivery costs because stores are generally already closer to consumers from a last-mile perspective or can offer same-day order pickup services. In some ways, McMillon’s declaration should not come as a surprise on the microfulfillment front because Walmart has been hinting at this future for some time now. For instance, Walmart last year began onsite collocated fulfillment tests in its Salem, New Hampshire store with a company called Alert Innovation. This store is also the very same store from which Walmart’s new U.S. President and CEO John Furner sent out a picture of himself on social media on Sunday using a new “sorting technology.” Coincidence? Not bloody likely. Furner has long been a champion of warehouse-like fulfillment out of stores. Prior to his current role, Furner, as CEO of Sam’s Club, also championed converting old Sam’s Club stores into e-commerce fulfillment centers. A mashup of the lessons learned from both these efforts could fit nicely into Walmart’s plans for supercenters going forward. Supercenters could act as one-stop shops for Walmart customers that still want to go to a physical store to shop but also still operate as automated logistics and fulfillment hubs for all America, as these stores are already built close to where Walmart customers live too. This proximity allows Walmart to generate a higher return on its inventory and its real estate in a manner that Amazon is years away from being able to duplicate. Required: Summarize the big reasons why the supercenters are brilliant.

Walmart supercenters can serve as new omnichannel fulfillment hubs Even if one buys into the arguments just discussed, both online grocery growth and more competition within the physical grocery space are still likely coming fast. Therefore, grocery stores, and Walmart’s supercenters are no different, do not need as much physical space in their stores as they did in the past to meet their customers’ needs. The smart move then is to reposition this space for other value creating activities, like hyperlocal microfulfillment, for example. Quickly, hyperlocal microfulfillment is the practice of collocating automated warehouse facilities within actual operating retail stores. The concept allows retailers to save money on picking and packing through automation and also allows them to save money on delivery costs because stores are generally already closer to consumers from a last-mile perspective or can offer same-day order pickup services. In some ways, McMillon’s declaration should not come as a surprise on the microfulfillment front because Walmart has been hinting at this future for some time now. For instance, Walmart last year began onsite collocated fulfillment tests in its Salem, New Hampshire store with a company called Alert Innovation. This store is also the very same store from which Walmart’s new U.S. President and CEO John Furner sent out a picture of himself on social media on Sunday using a new “sorting technology.” Coincidence? Not bloody likely. Furner has long been a champion of warehouse-like fulfillment out of stores. Prior to his current role, Furner, as CEO of Sam’s Club, also championed converting old Sam’s Club stores into e-commerce fulfillment centers. A mashup of the lessons learned from both these efforts could fit nicely into Walmart’s plans for supercenters going forward. Supercenters could act as one-stop shops for Walmart customers that still want to go to a physical store to shop but also still operate as automated logistics and fulfillment hubs for all America, as these stores are already built close to where Walmart customers live too. This proximity allows Walmart to generate a higher return on its inventory and its real estate in a manner that Amazon is years away from being able to duplicate. Required: Summarize the big reasons why the supercenters are brilliant.

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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#2 — Walmart supercenters can serve as new omnichannel fulfillment hubs Even if one buys into the arguments just discussed, both online grocery growth and more competition within the physical grocery space are still likely coming fast. Therefore, grocery stores, and Walmart’s supercenters are no different, do not need as much physical space in their stores as they did in the past to meet their customers’ needs. The smart move then is to reposition this space for other value creating activities, like hyperlocal microfulfillment, for example. Quickly, hyperlocal microfulfillment is the practice of collocating automated warehouse facilities within actual operating retail stores. The concept allows retailers to save money on picking and packing through automation and also allows them to save money on delivery costs because stores are generally already closer to consumers from a last-mile perspective or can offer same-day order pickup services. In some ways, McMillon’s declaration should not come as a surprise on the microfulfillment front because Walmart has been hinting at this future for some time now. For instance, Walmart last year began onsite collocated fulfillment tests in its Salem, New Hampshire store with a company called Alert Innovation. This store is also the very same store from which Walmart’s new U.S. President and CEO John Furner sent out a picture of himself on social media on Sunday using a new “sorting technology.” Coincidence? Not bloody likely. Furner has long been a champion of warehouse-like fulfillment out of stores. Prior to his current role, Furner, as CEO of Sam’s Club, also championed converting old Sam’s Club stores into e-commerce fulfillment centers. A mashup of the lessons learned from both these efforts could fit nicely into Walmart’s plans for supercenters going forward. Supercenters could act as one-stop shops for Walmart customers that still want to go to a physical store to shop but also still operate as automated logistics and fulfillment hubs for all America, as these stores are already built close to where Walmart customers live too. This proximity allows Walmart to generate a higher return on its inventory and its real estate in a manner that Amazon is years away from being able to duplicate. Required: Summarize the big reasons why the supercenters are brilliant.

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