Walmart's Advantage In E-Commerce? Its Stores.

Walmart has a big opportunity to leverage its existing base of 5,000+ stores around the US to streamline its e-commerce and logistics operations.

Walmart’s e-commerce growth is accelerating.

In its most recent filing, the Arkansas-based retailer posted 43% year-over-year growth in e-commerce sales in Q3’18, up from 40% the previous quarter.

What’s driving this increased growth? Walmart’s thousands of brick-and-mortar stores are likely a big part of the story.

Walmart had 5,352 total locations in the US as of October 2018. In comparison, Amazon has only 600+ stores (including 450+ Whole Foods), primarily in the US.

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Walmart remains ahead of Amazon in physical retail, though Amazon has plans to expand the number of Whole Foods and cashier-less Amazon Go locations. Moreover, the online shopping behemoth has been growing its massive e-commerce market share (reaching close to 50% in the US).

Amazon’s aggressive growth has pushed major brick-and-mortar retailers, like Walmart, to improve on both digital and physical fronts.

In this brief, we discuss how Walmart can leverage its existing stores as a key advantage against Amazon in e-commerce and logistics — specifically across online grocery, online order fulfillment, last-mile delivery, and returns.