Walmart is rapidly enhancing its fulfillment network to compete with Amazon's FBA program, and its latest innovation—the Inventory Placement Selection service—represents a significant advantage for marketplace sellers. Even more compelling: this service remains completely free until June 5, 2023.
WFS: Walmart's Answer to FBA
Walmart Fulfillment Services (WFS) operates similarly to Amazon's FBA model. Sellers ship products to WFS centers, while Walmart handles storage, shipping, customer service, and returns. When customers place orders, Walmart manages the entire fulfillment process—from picking and packing to transportation and last-mile delivery.
The program offers multiple delivery speed options including next-day, two-day, three-day, and standard (7-day) shipping. Products eligible for two-day delivery receive prominent "2-Day Shipping" badges on Walmart.com, along with "Fulfilled by Walmart" designations—visibility features that typically boost conversion rates.
Inventory Allocation: A Strategic Upgrade
The new inventory placement system represents a fundamental improvement to WFS operations. Walmart explains the rationale:
"A core benefit of WFS is fast two-day delivery. When creating a shipment plan, the system may direct sellers to send eligible inventory to multiple fulfillment centers. These locations are determined by product category and shipping origin. Strategic inventory distribution across Walmart's network ensures customers receive orders faster."
Sellers now have two options: manually distribute inventory or utilize the streamlined Inventory Transfer Service.
Inventory Transfer Service: Efficiency Redefined
This service allows sellers to ship all eligible inventory to a single consolidation point, after which Walmart distributes products across its national fulfillment network. Key benefits include:
- National inventory coverage: Ensures best-selling products remain available across multiple regions, minimizing stockouts.
- Reduced transportation costs: Eliminates the need for multiple shipments to different fulfillment centers.
- Uncompromised delivery speed: Maintains two-day or faster delivery promises despite the consolidation process.
Implementation Process
Activating the service requires minimal effort. When creating shipments in Seller Center, merchants simply select the Inventory Transfer Service option and ship products to the designated consolidation center. Note that inventory may require up to four days after arrival to transition to "Sellable" status while Walmart redistributes products.
Pricing Structure
While currently free, Walmart will implement the following fees beginning June 5, 2023:
- Small standard-size items: $0.25 per unit
- Large standard-size items: $0.35 per unit
- Oversize items: $0.45 per unit
Strategic Advantages
From an algorithmic perspective, distributed inventory creates multiple benefits. Products stored closer to customers may receive search ranking boosts, while buyers experience faster deliveries—a win-win scenario that enhances conversion rates and customer satisfaction.
For marketplace sellers, Walmart's continued WFS enhancements present growing opportunities to streamline operations and capture market share—particularly when leveraged during the current fee-free promotional period.