Create a free Industrial Equipment News account to continue

Walmart to Invest $14B in Automation

The company needs to get faster to keep up with Amazon.

Walmart is going all-in on becoming faster. Amid constant innovation competition from Amazon, the world’s largest retailer shared insights on Feb. 18 about its plans to invest nearly $14 billion in automation technologies and improving its supply chain network.

Walmart said the investment will be primarily in the US and focus on improving automation utilization and building supply chain capacity to stay ahead of demand and increase productivity.

In its fourth quarter earnings presentation, CFO Brett Briggs said that Walmart’s 2020 revenue increase put the company at least a year ahead of where it expected to be. That’s driven the decision to become more aggressive in key markets with increased capital and fulfillment capacity, supply chain, automation and technology. 

He said the company will step up automation in distribution centers to deliver aisle and department-ready pallets to stores, while expanded e-commerce assortment will reduce both shipping time and costs. Meanwhile, existing stores will get enhanced pickup and delivery capacity, merchandising programs and efficiency initiatives.

On that end, Briggs said, quote, “Now is the time to play even more aggressive offense. We're winning and we intend to keep pushing the ball aggressively down the field. Over the next few years, we're going to step up capital investment, primarily in the US, to improve the customer experience, support growth and drive efficiencies.” end quote.

Briggs said these investments should position Walmart for at least 4 percent annual growth in sales and operating profit, which would equate to adding a Fortune 100 company each year.

Walmart had 2020 total revenue of $559 billion, up nearly 7 percent from 2019. In the US comparable sales grew 8.6 percent, and US e-commerce sales jumped 79 percent.

Walmart is also raising the average wage of its associates to above $15 per hour.

More in Video