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Walmart plans to establish high-tech fulfilment centres to expedite the delivery of internet orders.

Walmart plans to establish high-tech fulfilment centres to expedite the delivery of internet orders.

Walmart is constructing high-tech warehouses in order to deliver things to customers faster and expand its online business.

The retailer announced on Friday that it will construct four new fulfilment facilities that will utilise automation to pack and transport online purchases more efficiently, with the first one set to open in Illinois this summer. 
Customers can expect next-day or two-day delivery for things like cereal and T-shirts as result of the new warehouses.
 
According to Michael Prince, Walmart’s vice president of supply chain innovation and automation, staff at Walmart’s existing fulfilment centres sometimes travel nine miles or more each day to pull things off shelves and haul them back to areas for packaging.
 
At the new warehouses, an automated system will retrieve items from a larger storage area and transfer them to an area where an employee will pack them in a box that will be custom constructed to meet the order’s specifications. Walmart put the idea to the test in Pedricktown, New Jersey, at a fulfilment centre.
 
The plans come as Walmart competes with Amazon, which has made it easy for Prime members to order a wide selection of things and have them dispatched within a day or two. Walmart now has 31 facilities that prepare online purchases, since the company’s website has become more important in recent years. More than 3,500 of its outlets, or almost 75% of the total, also accept online orders.
 

Automation has also been used by Amazon, Kroger, and others to increase capacity and speed. Amazon bought Kiva Systems, a company that made wheeled robots for its warehouses, a decade ago. It has experimented with robots to decrease labor-intensive tasks and formed a $1 billion fund in April to invest in firms developing supply chain solutions.

Through a cooperation with British online grocer Ocado, Kroger began opening massive robot-powered distribution centres in the United States last year.

Walmart’s first new fulfilment center will open in Joliet, Illinois, about 40 miles southwest of Chicago, and ship to customers across Illinois, Indiana and Wisconsin. Three more will follow in McCordsville, Indiana; Lancaster, Texas; and Greencastle, Pennsylvania in the next three years, the company said.

Walmart said it will hire 4,000 people to work at the new facilities. The current starting pay at existing warehouses is $16 to $28 per hour and wages at the new ones will be at the higher end of that range, the company said. The retailer declined to share construction costs.

Walmart will open its first new fulfilment centre in Joliet, Illinois, and will ship to consumers in Illinois, Indiana, and Wisconsin. In the next three years, the business plans to open three more in McCordsville, Indiana, Lancaster, Texas, and Greencastle, Pennsylvania.

According to Prince, Walmart shops will continue to play a role in the company’s supply chain, handling online orders for popular items as well as chilled and frozen groceries. Orders with a broader range of products, such as pantry basics and other dry groceries, will be handled by fulfilment centres.

Other parts of Walmart’s supply chain are also being revamped. Hundreds of businesses are becoming into mini-automated warehouses for online grocery deliveries. Walmart also said this week that it will add robotics to its 42 regional distribution centres, which replenish store shelves, in the coming years.

 

 

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