1. “The team is being flexible when it comes to meeting demand.”
McMillon noted Walmart has nearly 2,500 stores able to fulfill online orders. “We can quickly flex this number as the holiday season progresses, to help relieve pressure on our e-commerce fulfillment centers, if necessary,” he noted.
In the last few months, Walmart has been able to open more fulfillment center capacity including staffing out to be able to pick orders and ship from store, John Furner, president and CEO, Walmart U.S., explained. The team has done a good job “using all parts of the supply chain to fulfill our e-commerce demand, which would be reflected in the results that we saw in the quarter of growth of 79%.”
Looking ahead, Walmart is dedicating space in 42 of its regional distribution centers (RDCs) to add “pop-up e-commerce distribution centers” (eDCs) to meet the expected spike in e-commerce orders this holiday season, as well as unexpected peaks in the future.
2. Walmart is adding staff and machine learning to meet demand.
While Walmart struggled in its first quarter with out-of-stocks, the retailer has now doubled the number of people working in its pickup department up to 140,000, Furner said. In addition to the significant increase in staff, Walmart is using machine learning to figure out the best way to put labor against pickup slots, when to pick the slots, and then when to determine what can be filled, he explained, all leading to “nice productivity improvements.”
While Walmart has a time slot system for store pickups, it has also launched its Express two-hour delivery service in 2,700 stores this year, which employs machine learning to fulfill orders so quickly.
“We're really excited about the results in the first three quarters of the year with Express,” said Furner. “So that's been exciting. And then looking forward, every week now we've got literally millions of slots that are open and available for customers to select from, and we'll keep working on the things that we can do in the short-term to gain capacity.”