Walmart Makes a Huge Grocery Move, Amazon Drops Key Technology

Amazon (AMZN) has set the standard for delivery and fulfillment. Before the online leader declared that free, two-day shipping would be the minimum, there was no real set policy for delivery. Basically, if companies even had a website, they charged customers for shipping and items arrived whenever they arrived.

That has, of course, changed and Amazon has pushed expectations from two-day to same-day in many cases. Walmart (WMT) has spent billions following Amazon’s lead. The brick-and-mortar chain hasn’t quite been able to match Amazon, but it has made two-day delivery a standard while also doubling down on curbside pick-up.

Delivery has become an arms race with both companies looking for an advantage. That normally means that Amazon pushes the edge of what’s possible while Walmart tries to leverage the advantage of its huge physical presence.

Now, Amazon has actually suffered a delivery setback while Walmart may have bought itself an advantage.

PATRICK T. FALLON/AFP via Getty Images

Amazon Takes a Technology Step Back

Amazon has tried a lot of ideas when it comes to getting packages to customers faster. Some have been implausible — drones are going to be of limited use no matter how much money the company spends on them — while others have been hit or miss.

Now, the retailer has ended one of its technology-based programs that was designed to help last-mile delivery.  

“Amazon is ending its field tests of autonomous delivery robot Scout. The company is ‘reorienting the program’ after certain aspects failed to meet customer needs,” RetailDive reported.

Scout is a small, self-driving “robot” designed to make last-mile deliveries. The company had high hopes for it when it was introduced in 2019.

“Rather than fundamentally changing the way we operate, Scout is designed to enhance the delivery experience for our customers. Customers order as they normally would on the Amazon app or on amazon.com and enjoy the same delivery options — including free Same-Day, One-Day, and Two-Day shipping for Prime members. Their Amazon packages are then delivered by one of our trusted partner carriers or by Scout,” Amazon shared in 2019.

Amazon has now ended the Scout program which employed about 400 workers.

Walmart Doubles Down on Technology

Walmart has a huge advantage over Amazon when it comes to same-day grocery delivery or pickup given its massive physical footprint. Filling those orders, however, takes tens of thousands of people. Now, the chain has made a major purchase to help get those orders filled faster.

The retailer has purchased Alert Innovation, a robotics automation company that develops material-handling technology for automating order fulfillment in retail supply chains. Walmart has been working with Alert since 2016 in its fulfillment centers.

“Further investing in this technology will enable us to leverage our store footprint — 4,700 stores located within 10 miles of 90% of the U.S. population — for storage and fulfillment. For customers, this means orders can be fulfilled quickly and conveniently through pickup and delivery, giving them the items they want, when and where they want them. This system also enhances the experience for associates, who are integral to helping us perfect the system,” Walmart shared. 

Alert has been providing Walmart with robots that store, retrieve and dispense orders by moving horizontally, laterally and vertically across three temperature zones without any lifts or conveyors.

“This provides fewer space constraints inside the MFC and eliminates the need to pause the entire system for bot maintenance,” the company shared.

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