Walmart is partnering with Shopify to open the Walmart Marketplace to its sellers.
Leading platform enabling sellers to move online
Shopify has emerged as one of the leading ecommerce companies enabling sellers to develop an online presence through providing them with a platform and relevant services. The Shopify platform powers over 1m business across 175 countries, including smaller, individual sellers and major brands. It can be used to start an online business or enable physical retailers to develop an online presence. Recently it announced plans to launch Shopify Balance, a new financial product for smaller business owners, and the expansion of the Shopify Fulfillment Network. Last year, the company acquired 6 River Systems, a warehouse automation company to support its efforts in this area.
Marketplace growth out-performing US ecommerce growth
Through this initiative, Shopify’s sellers will have access to the Walmart Marketplace platform. This continues to grow rapidly, out-pacing sales through first-party inventory last quarter as Walmart saw channel sales increase by 74%. The initial focus will be on US-based small and medium businesses offering a complementary range of products. Walmart plans to add 1,200 sellers this year, helping it to boost its offer beyond the 80m products it currently offers online.
Making it easier to sell
Working with Shopify in this way highlights the strategic importance of the Marketplace to Walmart’s ecommerce strategy. Growing its range is a key part of this. Currently, Walmart offers around 75% of the top 500,000 products in the overall retail marketplace, with ambitions to move this proportion even higher. To drive this, a key focus over the last year has been to make it easier for sellers to work with its platform. Last year it launched Walmart Fulfillment Services (WFS), enabling Walmart to manage fulfillment on behalf of selected sellers. Inventory is shipped to Walmart’s fulfillment centres, with the retailer managing shipping and returns and sellers tapping into the retailer’s two-day delivery programme.
While the initiative was developed to support existing sellers and attract new companies to its platform, over the longer-term, the potential exists to expand the service to sellers on other platforms. This is something that could be tested through the partnership with Shopify, leading to further integration between the two companies in the future.
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