Online-offline integration: Walmart China focuses on US$104mn food distribution centre alongside e-commerce and delivery services

23-Jan-2019 - Last updated on 23-Jan-2019 at 01:22 GMT

Retail giant Walmart China set to launch its first perishable food distribution centre in China, with operations set to get underway in March. ©Walmart

Related tags Walmart China omnichannel e-commerce

Retail giant Walmart China set to launch its first perishable food distribution centre in China, with operations set to get underway in March.

Valued at some US$103.7m (RNB700m), the centre will be located in Dongguan city, Guangdong.

“[This is] the largest investment by Walmart since it entered the Chinese market 22 years ago,” said Walmart China President and CEO Tan Wern-Yuen to China Daily.

He added that Walmart China has plans to build or refurbish 12 or more of such centres in China over the next two decades.

“[Our focus] in 2019 [is] on consolidating upstream resources and to further improve product quality.”

According to Chinawuliu, growth from Walmart China’s omni-channel sales is expect to hit over three digits in 2019.

Fresh foods took some 25% of sales figures for Walmart China last year, which could explain the company’s rapid expansion in this area alongside focus on its private fresh foods brand Marketside.

With regard to e-commerce, Tan said that the company’s online transactions have grown 150% year-on-year in terms of revenue, which is the third time running that it has hit three-digit growth.

To complement online services, Walmart China also intends to connect 300 of its stores to its JD Daojia delivery service.

Full online-offline integration: Next Generation store to revolutionise omnichannel retail

Walmart China’s Next Generation Store launched in December 2018 with an eye on revolutionising retail innovation.

“Our Next Generation Store is […] a customer-centric move to better meet customers’ demand for quality and service up grade,” said Walmart China Stores Senior Vice President and COO Bernardo Perloiro in a statement on the Walmart China website.

“The Next Generation Store is one of our future strategic focuses, and we look forward to replicating the learnings across the country once the pilot is successful.”

Apart from a focus on design, comfort and more tailored selections, one of the main highlights of the store is its digital focus, for example the use of the WeChat mini programme Scan & Go, which the company describes as ‘an important step forward in retail digitalisation’.

“By using this technology, customers can skip the lines at the checkout counter by scanning the barcode on products to complete payment by themselves, with no need to download another app,” said Walmart China on its site.

Since its official launch last April, Scan & Go has accumulated 17 million users (as of November 2018). Walmart China added that over 30% of customers choose to pay using this technology.

Future plans for the programme include the pushing of electronic vouchers to customers based on their shopping preferences.

In addition, the Next Generation Store will also incorporate JD Daojia delivery services to provide customers with a truly omnichannel shopping experience.

“Customers who live within 3 kilometres of the store can receive their online orders within 1 hour if they place orders on JDDJ,” said Walmart China.

“To accelerate product picking and optimise picking processes, the store has a full assortment picking zone in place [which] will be equipped with smart wearables for better efficiency and accuracy.”