Walmart to expand grocery delivery business to 800 stores by year's end

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Walmart is building on its online grocery pickup program that uses personal shoppers to pick items and then take them to shoppers' cars parked at the curb.

Walmart Inc. has also been testing a service using its USA store workers to drop off general merchandise like toys and bedding to customers' homes after they finish work.

Walmart's new service could also be a response to Amazon's $13.2 billion purchase past year of Whole Foods.

Amazon is now rolling out free two-hour delivery of Whole Foods groceries in six cities to Prime members who pay $99 a year.

And Target, through its acquisition of grocery delivery startup Shipt previous year, is expanding same-day delivery of such items as groceries and electronics to almost every major market by the holiday shopping season. For now this includes Uber and Deliv, but the company tells us more will be added to that lineup soon. But it can't ignore consumer demand for grocery delivery forever. Walmart may also be able to use the new service as a way to give its online sales a shot in the arm, after a holiday quarter that disappointed Wall Street due to slowing online sales growth. With all those new cities, the service will eventually reach 40 percent of USA households, the company said. The online retailer has already started offering free, two-hour deliveries of Whole Foods groceries in a handful of markets to its Prime customers. Walmart said more delivery companies will be announced later. "Walmart no doubt hopes that baskets well above $30 will dominate but either way, quick expansion will bring new insights into the economics".

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Walmart has been beefing up its online grocery options, including buy online, pickup in store and a pilot for in-fridge deliveries.

Groceries are key to Walmart's success with about 56 percent of its USA revenue coming from grocery sales.

Walmart has been investing in online grocery for years, starting with limited tests of curbside pickup that later expanded across the U.S. He also said Tuesday that the company now employs more than 18,000 personal shoppers with additional hires planned as both grocery pickup and delivery services are rolled out to a larger audience this year.

More recently, it began working with partners like Uber to trial grocery delivery in select markets including Dallas, Denver, Orlando, Phoenix, Tampa and San Jose. "We're serving our customers in ways that no one else can".

Grocery pickup and delivery services are a big part of Walmart's plan to grow its e-commerce business as well after USA online sales decelerated to 23 percent in the fourth quarter.

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