How AI and Automation Fuel Walmart’s Ultrafast Deliveries | WSJ Shipping Wars

00:09:05
https://www.youtube.com/watch?v=Nf-P-qNej3c

Resumen

TLDRWalmart's Alphabot technology revolutionizes online order fulfillment by automated picking in market fulfillment centers (MFCs), enhancing efficiency and speed. The MFCs are connected to existing Walmart Supercenters, allowing for rapid fulfillment with a small footprint. Walmart plans significant automation investments by 2025, aiming to service 65% of its stores with these technologies. Efficiency is further amplified by reducing in-store congestion and leveraging its vast store network for quick delivery options. Walmart competes with Amazon and Target through its advanced fulfillment strategies, focusing on customer experience and operational improvement.

Para llevar

  • 🤖 Meet Walmart's Alphabot for online order fulfillment.
  • ⏱️ 95% of orders picked in under 12 minutes.
  • 🏬 MFCs enhance e-commerce efficiency attached to Supercenters.
  • 📈 By 2025, 65% of stores will use automation.
  • 💡 Alphabot brings items directly to associates, speeding up the process.
  • 📦 Walmart invests in both next-generation and traditional fulfillment centers.
  • 🛒 Leveraging store locations promotes fast delivery.
  • 🌐 Competing successfully against Amazon and Target.
  • ⚙️ Automation transforms warehouse and retail jobs.
  • 🚀 Investments in technology aim to improve customer experience.

Cronología

  • 00:00:00 - 00:09:05

    Walmart is leveraging advanced technology, like Alphabot, in their market fulfillment centers (MFCs) to enhance efficiency in online order processing. The Alphabot system allows 95% of orders to be picked in under 12 minutes, aiming to compete with Amazon and Target by investing in automation for faster delivery options. By 2025, automation will service 65% of Walmart's stores, making it a key part of their strategy in transforming their traditional retail model into a robust e-commerce operation.

Mapa mental

Vídeo de preguntas y respuestas

  • What is Walmart's Alphabot?

    Alphabot is a robotic system used in Walmart's market fulfillment centers to pick items for online orders quickly.

  • How fast can Walmart fulfill online orders using Alphabot?

    95% of Walmart's orders can be picked in under 12 minutes using Alphabot.

  • What are market fulfillment centers (MFCs)?

    MFCs are facilities attached to Walmart Supercenters designed to efficiently manage e-commerce grocery orders.

  • What is Walmart's goal with automation by 2025?

    Walmart aims to have 65% of its stores serviced by automation by 2025.

  • How does Alphabot improve efficiency?

    Alphabot reduces the need for associates to walk long distances by bringing items directly to them, thus speeding up the picking and packing process.

  • What is Walmart's strategy compared to Amazon and Target?

    Walmart leverages its extensive store network for same-day delivery and invests in automation and technology to enhance service.

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Desplazamiento automático:
  • 00:00:01
    - [Narrator] Meet Walmart's Alphabot.
  • 00:00:04
    This robot spends all day picking items for online orders
  • 00:00:07
    at the company's market fulfillment centers,
  • 00:00:10
    and it's key to speeding up Walmart's delivery.
  • 00:00:13
    95% of its orders can be picked in under 12 minutes.
  • 00:00:17
    In the shipping war against Amazon and Target,
  • 00:00:20
    Walmart is leaning into the cutting edge,
  • 00:00:23
    investing in drone delivery
  • 00:00:25
    and automated fulfillment centers.
  • 00:00:27
    - By 2025, 65% of our stores will be serviced by automation.
  • 00:00:33
    - [Narrator] Here's how the country's biggest retailer
  • 00:00:35
    is going high tech to deliver on more than just speed.
  • 00:00:46
    This market fulfillment center or MFC is attached
  • 00:00:49
    to a Walmart Supercenter more than six times its size.
  • 00:00:53
    Of all the company's e-commerce fulfillment methods,
  • 00:00:56
    MFCs have the smallest footprint.
  • 00:00:59
    - Walmart is the largest grocer in the country.
  • 00:01:01
    They have added many more different ways to get delivery,
  • 00:01:05
    often using groceries as sort of a linchpin,
  • 00:01:08
    so that was a big evolution when they started to think
  • 00:01:10
    of their online business as really a grocery business.
  • 00:01:13
    - [Narrator] In the back of the MFC,
  • 00:01:15
    this structure holds 6,000 to 8,000
  • 00:01:17
    of the most popular products sold in this area.
  • 00:01:20
    - Our automated market fulfillment centers
  • 00:01:23
    separate the inventory from the goods
  • 00:01:25
    that customers are shopping on the store floor.
  • 00:01:28
    These are appended to our back rooms
  • 00:01:30
    or appended to our supercenters.
  • 00:01:33
    That separate inventory reduces congestion,
  • 00:01:36
    and the machine-level accuracy ensures
  • 00:01:39
    that we're picking the right items
  • 00:01:40
    at the right times for our customers.
  • 00:01:43
    - [Narrator] Order fulfillment starts here
  • 00:01:45
    where items are scanned into the Alphabot system.
  • 00:01:48
    - We have about 175 bots traversing this system.
  • 00:01:52
    The bots move laterally, horizontally, and vertically
  • 00:01:56
    to retrieve customers' goods.
  • 00:01:58
    - [Narrator] Each robot can carry
  • 00:01:59
    a single milk crate-size bin that can hold anything
  • 00:02:02
    from minced garlic to 24-packs of soda.
  • 00:02:06
    When the system receives your order,
  • 00:02:07
    robots begin bringing your items one bin at a time
  • 00:02:10
    to this picking station.
  • 00:02:12
    At the same time, other robots carry these empty bins
  • 00:02:15
    for the items to be collected in.
  • 00:02:17
    These lights show the associate which items
  • 00:02:19
    to take and where to put it.
  • 00:02:21
    - Instead of a user picking a product
  • 00:02:24
    and then walking, walking, walking to that next product,
  • 00:02:27
    one piece of automation could bring that product
  • 00:02:29
    to the picker, so it does allow opportunities to speed up
  • 00:02:33
    through the picking and packing process,
  • 00:02:35
    which inherently drives accelerated shipping.
  • 00:02:39
    - [Narrator] When all the items in your order
  • 00:02:40
    have been collected, the bins get dispensed here
  • 00:02:43
    where they're scanned and labeled.
  • 00:02:45
    The crates get pushed a few hundred feet away.
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    Here bins from room temperature, fridge,
  • 00:02:50
    and frozen picking are consolidated
  • 00:02:52
    so that a customer's entire order is in one place.
  • 00:02:56
    Any items that were handpicked from the store shelves
  • 00:02:58
    are also brought here.
  • 00:03:00
    Now, orders can be picked up by customers in person,
  • 00:03:03
    delivered by a Walmart driver,
  • 00:03:05
    or in limited locations, dropped off by drone,
  • 00:03:08
    often within hours.
  • 00:03:10
    All of these options are available
  • 00:03:12
    because the facility is attached to a store
  • 00:03:14
    that's already close to the customer.
  • 00:03:16
    Like Target, Walmart has a huge built-in advantage
  • 00:03:19
    when it comes to faster delivery,
  • 00:03:21
    a web of more than 4,600 stores across the US alone.
  • 00:03:25
    More than 4,000 of those stores offer same-day delivery
  • 00:03:28
    directly from those locations.
  • 00:03:31
    Target, on the other hand, is building a network
  • 00:03:33
    of facilities that would relieve local stores
  • 00:03:35
    of sorting and delivery duties.
  • 00:03:38
    - Our stores provide a great advantage
  • 00:03:41
    when it comes to fast delivery because they're located
  • 00:03:44
    within 10 miles of 90% of the population.
  • 00:03:47
    - A few years ago, Walmart made a massive shift
  • 00:03:49
    to using most of its stores to fulfill e-commerce orders.
  • 00:03:53
    They're trying to kind of control more of it
  • 00:03:55
    than they would have in the past
  • 00:03:57
    and find ways to kinda use all the stores
  • 00:04:00
    that they already have instead of spending more money,
  • 00:04:02
    and it's very expensive
  • 00:04:03
    to build e-commerce fulfillment centers.
  • 00:04:05
    - [Narrator] But most stores weren't originally built
  • 00:04:08
    to handle both physical and online shopping.
  • 00:04:11
    - You may ship product from a store that a customer
  • 00:04:15
    in that retail store actually wanted
  • 00:04:16
    or went specifically to purchase,
  • 00:04:18
    and so you may be disrupting
  • 00:04:19
    that in-store shopping experience.
  • 00:04:21
    - We're making substantial investments upstream
  • 00:04:24
    in our distribution centers to ensure
  • 00:04:26
    that we can get the right items
  • 00:04:28
    at the right time at our stores.
  • 00:04:31
    We are also making significant investments
  • 00:04:34
    in the digitization of our supply chain.
  • 00:04:36
    We're utilizing AI and ML algorithms to improve forecasting,
  • 00:04:41
    as well as improve placement of inventory
  • 00:04:44
    in our stores and our fulfillment centers.
  • 00:04:47
    - They wanna basically build a mini version of something
  • 00:04:50
    that is specifically to fulfill online orders
  • 00:04:52
    so they can do it fast.
  • 00:04:53
    They can have a higher quantity of orders
  • 00:04:56
    that move through stores.
  • 00:04:58
    - [Narrator] Walmart now has seven of these facilities
  • 00:05:00
    with plans to open over 100 more in the next few years.
  • 00:05:04
    But investing in MFCs doesn't mean the company
  • 00:05:06
    is abandoning the traditional e-commerce distribution model
  • 00:05:10
    that relies on huge dedicated warehouses.
  • 00:05:13
    Walmart is also investing in five large facilities
  • 00:05:16
    that it calls next generation fulfillment centers.
  • 00:05:18
    Three have already opened.
  • 00:05:20
    At 1.5 million square feet,
  • 00:05:22
    these centers are fully automated.
  • 00:05:24
    - Our next generation FCs, coupled with our legacy FCs,
  • 00:05:28
    can access 95% of the US population
  • 00:05:31
    with next day or two day delivery.
  • 00:05:34
    - They're gonna see what we as shoppers like
  • 00:05:36
    and gravitate to and what they can afford,
  • 00:05:38
    what makes it a little bit more profitable.
  • 00:05:40
    - Customers are willing to change brands if they're able
  • 00:05:43
    to get their product much faster,
  • 00:05:45
    and that race for speed is really being driven by a number
  • 00:05:48
    of factors, including fragmentation of retail base.
  • 00:05:51
    You're seeing more and more startup companies being able
  • 00:05:54
    to compete with traditional retailers.
  • 00:05:56
    They're able to provide that next-day service to customers,
  • 00:06:00
    and that's really driving expectations
  • 00:06:02
    for many other retailers and their customers.
  • 00:06:04
    - [Narrator] As e-commerce becomes a bigger
  • 00:06:06
    and bigger share of overall retail sales.
  • 00:06:09
    - Walmart is experimenting with lots of things
  • 00:06:12
    and hoping that some of them stick.
  • 00:06:14
    We're kind of back to 2019 in retail.
  • 00:06:17
    A lot of weird things that happened during COVID
  • 00:06:19
    that impacted the business.
  • 00:06:20
    Now they have to get back to competing head on
  • 00:06:23
    for every dollar.
  • 00:06:24
    - Speed is important within this space,
  • 00:06:28
    but what's also important is being time-definite.
  • 00:06:30
    We don't always ship things as fast as we can send them.
  • 00:06:33
    Sometimes customers want to have items delivered
  • 00:06:35
    at a specific time,
  • 00:06:37
    and we aim to meet customers the way they want to be met.
  • 00:06:40
    - E-commerce delivery, especially small little items
  • 00:06:43
    to your doorstep in any form is not necessarily profitable.
  • 00:06:47
    Walmart is trying to take a somewhat similar approach
  • 00:06:50
    to Amazon, which uses advertising dollars
  • 00:06:52
    or cloud computing profits
  • 00:06:54
    to offset the cost of fast delivery.
  • 00:06:57
    - [Narrator] Customers also pay for some of that cost.
  • 00:06:59
    Walmart+ members pay $98 annually for free shipping
  • 00:07:03
    with fees for delivery within hours.
  • 00:07:06
    But one of the most important cost savers
  • 00:07:08
    could be Walmart's investment in automation.
  • 00:07:11
    - What's sort of striking is that
  • 00:07:13
    as Walmart rolls out automation, it will change
  • 00:07:15
    what a warehouse job or retail job is in America
  • 00:07:19
    because Walmart's the largest private employer
  • 00:07:21
    in the country.
  • 00:07:22
    Some of the workers that I talked to that have transitioned
  • 00:07:25
    to these new roles said that their coworkers
  • 00:07:27
    who haven't made the leap are sort of, in some cases,
  • 00:07:30
    afraid of the technology.
  • 00:07:31
    It's such a different job,
  • 00:07:32
    they just don't necessarily feel comfortable with it yet.
  • 00:07:36
    - [Narrator] But Walmart says
  • 00:07:37
    it's not shrinking its workforce overall.
  • 00:07:39
    - As we've talked to our associates,
  • 00:07:41
    we talk about how work is going to look different.
  • 00:07:43
    Today they may walk anywhere from eight to ten miles a day,
  • 00:07:47
    lift hundreds of items or move cases,
  • 00:07:50
    driving powered industrial equipment.
  • 00:07:51
    In the future, our associates are going to operate,
  • 00:07:54
    be cell operators.
  • 00:07:56
    They're going to be maintenance technicians.
  • 00:07:58
    These are the roles that will require them
  • 00:08:00
    to use their problem solving skills, their creativity.
  • 00:08:03
    - [Narrator] All of that automation is being implemented
  • 00:08:06
    in the pursuit of undamaged packages delivered exactly
  • 00:08:09
    when customers want.
  • 00:08:10
    - To deliver the perfect order,
  • 00:08:13
    we're investing in digitizing our end-to-end supply chain
  • 00:08:16
    to ensure that we have the right items
  • 00:08:18
    in the right locations at the right time.
  • 00:08:21
    We're investing in automation
  • 00:08:23
    so that we can have right-sized packages,
  • 00:08:26
    so that we can have fully curbside recyclable orders,
  • 00:08:29
    and so that we can have the level of precision required
  • 00:08:33
    to ensure that orders are fully accurate
  • 00:08:36
    when they arrive on customers' doorsteps.
  • 00:08:38
    - Walmart still has a long way to go in terms of catching up
  • 00:08:41
    with Amazon on e-commerce,
  • 00:08:43
    but they're a bigger company than Amazon,
  • 00:08:45
    and Amazon hasn't quite figured out stores yet,
  • 00:08:48
    so they're actually competing
  • 00:08:49
    in interesting ways on multiple fronts.
  • 00:08:51
    - [Narrator] In our final episode, it's all about you,
  • 00:08:54
    the customer, and your experiences.
  • 00:08:56
    (upbeat music)
Etiquetas
  • Walmart
  • Alphabot
  • Automation
  • E-commerce
  • Delivery
  • Market Fulfillment Centers
  • Robotics
  • Supply Chain
  • Retail
  • Technology