Retail Giant Walmart Announces Next-Day Delivery

Walmart

Walmart, the biggest retailer in the world, will now offer shoppers the option to have their online orders delivered the next day.

The announcement comes just a few weeks after Amazon announced plans to spend $800 million for one-day delivery for all Amazon Prime members.

Walmart said it is rolling out next-day delivery in Phoenix, Las Vegas and Southern California over the next few days and will expand it to reach roughly 75 percent of American consumers by the end of 2019, including 40 of the top 50 major metros. Amazon hasn’t yet detailed a timeline for its own rollout of next-day shipping.

Walmart isn’t disclosing the cost of its latest delivery push. But the company says it has been working on it for quite some time.

“We have been working on this for the past several years,” Marc Lore, head of Walmart’s e-commerce business in the U.S., said about the move toward next-day shipping. “We’ve been investing … and now we are in the position to reap the benefits.”

In January 2017, Walmart started offering free, two-day shipping for orders totaling more than $35, lowering its minimum purchase threshold from $50. It had already bought Jet.com for $3 billion in 2016 to juice its online business and compete with Amazon. That deal helped it reach shoppers in bigger cities, like New York, in less time.

To start, next-day delivery will be available for about 220,000 items “most frequently purchased” online, Walmart said, including toys and electronics. The company said it plans to make more items available to ship next day over time. And the option is only free for orders over $35. Amazon, for comparison, has no minimum purchase threshold for free, next-day delivery but requires customers to have a Prime membership, which costs $119 annually.

When Amazon made its one-day shipping the new standard for all Prime customers last month it sent shares of Walmart and Target tumbling, as investors worried bricks-and-mortar retailers would now have to spend more money to match the e-commerce giant’s steps. Walmart’s stock price was up 0.5% in Tuesday’s premarket. Amazon shares were 1% higher.

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