Retail giants Target Corporation and Walmart Inc are reportedly trying their hands at local package delivery, as a surge in e-commerce demand has put pressure on conventional carriers such as U.S. Postal Service, FedEx Corporation, and United Parcel Service Inc.
The move is an attempt by Target and Walmart to catch up to Amazon, the world’s largest online retailer. Amazon has employed legions of small businesses to distribute packages from vans inscribed with the company's logo, allowing it to keep customer wait times and costs under control.
Since the coronavirus pandemic struck the United States last year, leading delivery services companies like FedEx Corp., UPS, and the USPS recorded massive shipments requests. This pushed retailers to find new ways to deliver products to consumers while keeping increasing shipping costs in check.
John Furner, Walmart's U.S. Chief Executive, mentioned has been testing its first co-branding last-mile delivery vans.
Camille Dunn, the company spokeswoman, stated that a small electric van convoy has been delivering packages in the Rogers and Bentonville areas near Walmart's Arkansas headquarters since January.
Attesting to Walmart's project, Cathy Morrow Roberson, a shipping consultant, reportedly said they have the financial means to develop a last-mile distribution network and can afford to establish a trucking network.
It is to be noted that the truck driver shortage is posing a threat to retailers' ability to restock their shelves. However, van drivers should be easier to come by as they do not require specialized licenses like big-rig drivers.
So far, Target has relied on independent drivers from Shipt, which it acquired in 2017. The retailer started exploring home package delivery from a new sorting center in Minneapolis earlier this year. Workers in that center sort packages by zone and hand it to Shipt delivery drivers, who drive their vehicles, sources cited.
Amazon, Target, and Walmart all rely on gig staff to make same-day, local deliveries. Target relies on Shipt and other vendors, Amazon’s service is known as Flex, whereas Walmart has its own Spark Driver delivery platform.
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