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Walmart Expands Drone Delivery

Walmart is inching closer to expanding its drone delivery service into six states by the end of the year.

Drone delivery by DroneUp is now available for some customers in the Phoenix, Dallas-Fort Worth and Tampa, Fla. markets.

The new delivery option will be fulfilled from four stores local to Phoenix—two each in the Arizona towns of Glendale and Peoria. Tampa-area shoppers can opt to receive drone delivery from seven Florida stores in Clermont, New Port Richey, Valrico, Winter Haven, Brandon and Tampa. And around the Dallas-Fort Worth metro, the deliveries will come from 11 stores across eight municipalities, including Dallas, Garland, Murphy, Plano, Richardson, Mesquite, Rowlett and The Colony.

Already having launched three delivery hub sites at Walmart stores in Northwest Arkansas, the retail giant expects to also operate in Utah and Virginia by the end of 2022.

This marks the first time customers in Arizona, Florida and Texas can take advantage of Walmart’s drone delivery, following the retailer’s earlier announcement of plans to expand its DroneUp network to reach 4 million additional households in six states. Walmart says it has successfully executed thousands of same-day drone deliveries to date.

“Drone delivery makes it possible for our customers to shop those last-minute or forgotten items with ease, in a package that’s frankly really cool. Being on the forefront of that innovation at Walmart is something we’re proud of,” said Vik Gopalakrishnan, vice president, innovation and automation, Walmart U.S. “It may seem like a futuristic option, but it’s giving our customers what they’ve always wanted, and that’s time back to focus on what is most important to them.”

Customers living within a mile of a participating store can place orders through droneupdelivery.com between 8 a.m.-8 p.m. local time. Drones can deliver more than 10,000 eligible Walmart items up to 10 pounds in as little as 30 minutes. There are no order minimums and the delivery fee is $3.99. With the use of a promo code depending on state of residence, first-time drone delivery customers will have the delivery fee waived. Once the items are packaged and loaded into the drone, the order is then delivered using a cable that safely lowers the package into the customer’s yard.

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In total, there will be 34 Walmart stores making drone delivery available in 23 cities nationwide by year end. Walmart has previously said it aims to deliver more than 1 million packages by drone annually.

DroneUp deliveries are powered by a team of certified pilots operating within Federal Aviation Administration (FAA) guidelines to safely manage flight operations. Deliveries will be made to the safest location of the customer’s home, such as in the front or backyard or driveway.

“Our mission is to set the gold standard for drone delivery and by partnering with Walmart, bring the incredible benefits that drones offer to local communities, organizations, and businesses,” said Tom Walker, CEO of DroneUp. “Our approach is unique; we practice safety above all else and incorporate state-of-the-art technology. Our strong relationship with the FAA has also been critical to our success as we build an infrastructure that supports growth and great career programs for operators now and in the future.”

Walmart brings new DCs to Canada, Mexico

The drone delivery expansion comes as Walmart is further building out its supply chain infrastructure in North America with new distribution centers in Canada and Mexico.

Slated to open in 2024, a 457,000-square-foot space in Vaudreuil-Dorion, Quebec, will use technology to speed up order fulfillment, keep transportation costs down and offer customers quicker services and a broader product assortment, Walmart says. This platform will accelerate order fulfillment through an advanced operating system that will help associates store, pick and sort items by using smart and flexible storage abilities to manage a large and wide variety of inventory.

The fulfillment center, which costs $100 million Canadian dollars ($73 million), is capable of shipping 20 million items annually from the facility to local customers, storing 500,000 items to fulfill direct to home and in-store pickup orders and ultimately designed to optimize packaging, minimize waste and reduce transportation costs. The site will create approximately 225 new jobs in Quebec, plus construction and engineering jobs.

This new site comes in addition to two Walmart Canada distribution centers that opened earlier in 2022. The company’s most advanced grocery distribution center opened in British Columbia, and the first distribution center serving the Eastern region opened in New Brunswick. Walmart also opened a new, high-tech sortable fulfillment center in Alberta, and is set to open what it calls the country’s first fully automated ambient distribution center in Ontario in early 2024.

And in Mexico, the soon-to-open perishables distribution center in Villahermosa is aiming to strengthen the company’s logistics and supply chain networks across the country’s southeast region. The new distribution center was built to improve how Walmart moves perishable goods, with the idea to give the warehouse access to a wider range of fresh local products at Walmart’s everyday low prices. Another distribution center, set to open in Mexicali, provides a similar set of advantages, but for dry and ambient products.

Walmart expects the two Mexico distribution centers to create approximately 3,200 new direct and indirect jobs.

Patricio Dallan, senior vice president, supply chain, Walmart Canada, and Enrique Pellico, vice president, supply chain, Walmart of Mexico and Central America, unveiled the progress in a joint statement.

“These investments, raised independently in their respective markets, are central to our belief in the value of strong local businesses powered by Walmart,” Dallan and Pellico said. “Each new investment helps us build trust in the communities we serve and increase access to affordable goods, while creating jobs that push places and their people forward. Part of giving Walmart customers a great shopping experience is found in the speed of fulfillment. We want our customers across town—and across the country—to get what they need, how and when they need.”

The Walmart supply chain VPs also celebrated the company’s push toward carbon-zero distribution centers: “Across international markets, we’re keeping our commitments to regeneration in mind. As Walmart aims to become a regenerative company by 2040, we’ll continue looking for innovations that put both people and nature at the center of our business practices.”

They also touched on the infrastructure investments in the U.S., including the 1.1 million-square-foot Joliet, Ill. distribution center built earlier this year. The Illinois warehouse was one of four next-gen fulfillment centers that Walmart unveiled earlier this, including facilities currently being built in Indiana, Texas and Pennsylvania, that will have the capacity to provide around 75 percent of the U.S. population with next- or two-day shipping on “millions” of items.

Walmart revives Text to Shop tech

Walmart’s innovations don’t stop with delivery and fulfillment related initiatives, with the company’s tech wing coming out with the newest iteration of its Text to Shop technology.

Consumers with a Walmart account can use the Text to Shop experience, available for iOS and Android, to text the items they need via standard texting or the Walmart app, which automatically adds the products to their cart. Users can choose from the full selection of Walmart’s products, including items from a local store or from Walmart.com. Users can also text “reorder” to quickly review and add frequently ordered items to their cart.

At the end of the process, consumers can select a time slot for pickup or delivery.

Walmart's Text to Shop functionality
Walmart’s Text to Shop functionality

Walmart already had a foray with Text to Shop technology with a service called Jet Black, which catered to a narrow audience of affluent millennial parents in New York City and carried a $50 monthly membership. As part of its offering, Jet Black sourced products both from Walmart and other brands like Zara, Saks and Pottery Barn—a feature that has not since been carried over to the current Text to Shop functionality.

After less than two years of operation, Walmart ended the Jet Black experiment in early 2020, folding it into its wider customer organization.

At the time, the company said it learned how customers respond to the ability of ordering by text as well as the type of items they purchase through texting, This included not just text-based ordering, but voice ordering in pickup and delivery.

In a recent blog post, Dominique Essig, vice president of conversational commerce of Walmart’s tech incubator Store No. 8, shared insights from select customers about their experience.

“When different things pop into your mind you’re usually out and about running errands. I don’t have time to log into the app and add to the cart,” said a customer named Keisha.

Another consumer, Valerie, said “I had gotten everything I needed but then I forgot two or three items, and I could get them with just a text. It’s almost as if you have your own personal shopper.”

It appears much of the incentive behind the conversational commerce play is still geared toward Walmart’s younger, busier consumer base.

“We know that for busy families and young professionals, finding opportunities to slow down and live in the moment is a priority. That’s what inspired Text to Shop,” Essig said in the post.