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"Should I Sell on Walmart?"

23 August 2017

By Ethan Morgan


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eCommerce businesses are asking themselves this question across the US. So what makes Walmart such an intriguing prospect for sellers?

A quick history lesson. Retailing giant Walmart was founded and is still majority-owned by the Walton family in 1962. From its origin in Arkansas, in 2016 the business turned over almost half a trillion dollars. It also owns, among others, the UK supermarket chain Asda and the up and coming Jet marketplace.

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Here are the essentials to know about Walmart's online operation, to help you make the decision:

Walmart sees 100m unique shoppers per month pass through its digital door to Walmart.com. Operating very much like Amazon – a relative newcomer to retail, founded in 1994 – marketplace.walmart.com allows third party sellers, including drop ship vendors, to place their products alongside Walmart’s.

Walmart has integrated its marketplace into the main web portal www.walmart.com and offers a selling portal which it calls, unsurprisingly, Seller Center. This offers a seamless experience and, similar to Amazon, it’s not immediately obvious to buyers whether the item is being sold by Walmart or by a third party.

Walmart and eCommerce

So, what is the Walmart marketplace opportunity? Walmart has announced its intention to compete with Amazon, indicated by the speed with which it’s adding sellers and products to the marketplace. As a marketplace seller, it's always good to diversify and rely less on a single channel. With the stakes so high for these big players, it makes sense to hedge on either side or risk being squeezed in the middle.

Walmart’s ecommerce business includes all web-initiated transactions such as ship-to-home, ship-to-store, pick up today, and online grocery, as well as transactions through Jet.com. The focus on ecommerce has also lead to the policy of offering free two-day shipping on $35+ orders, available at the company’s website.

Walmart’s ecommerce sales and gross merchandise volume increased 15.5% and 17.5% respectively, in the fourth quarter of 2016. The company covers more than 65 million SKUs from a marketplace perspective. Part of the drive for getting new marketplace businesses onboarded is to increase their SKU coverage even further. 

The eCommerce Come-back Kid

According to Forbes magazine, the most striking development of 2016 was Walmart’s comeback in the ecommerce space. The company added millions of items to its marketplaces, which helped it resume its online growth in 2016.

In addition, the company expanded the number of locations for shoppers to pick up online orders, making the process more convenient. Walmart continues to expand its online selection, mainly by inviting more retailers and consumer brands to sell on Walmart.com and its international ecommerce sites - if you're able to get onto the platform, you could benefit from this growth.

Finally, in 2016, Walmart’s ecommerce sales contributed 15% to its total retail sales. This compares very favourably with the US ecommerce as a whole, which is a mere 8.1% of total US retail.

If you want to dig deeper into the opportunities for selling on the Walmart marketplace, you should register for our free webinar to see how your business could benefit.

We're also going to be writing about Walmart all this month, so if you're interested, subscribe to the blog using the button above.

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