Walmart and Target both announced plans Thursday to improve last-mile fulfillment and delivery from their stores, taking alternate routes via a self-driving car investment and a new sortation facility powered by acquired technologies, respectively.
Walmart said it has invested in GM’s Cruise project, after a successful pilot of the autonomous delivery car last year in Scottsdale, AZ, now apparently the national capital for such trials. The amount invested was not shared but total funding to date in Cruise is $2.75 billion, up from $2 billion previously, between Walmart and institutional investors.
In addition to GM, Honda and Microsoft are also partners in the Cruise initiative.
“As delivery has become a staple in our customers’ lives, we’re focused on growing our last mile ecosystem in a way that’s beneficial for everyone – customers, business and the planet,” said John Furner, President and CEO of Walmart U.S., in a blog post. “With their all-electric fleet powered by 100% renewable energy, Cruise is a natural partner as we work to take collective action on climate change.”
Furner said Walmart has set targets of 2040 for net zero carbon emissions, and 2035 for 100% renewable energy power. It has also created Project Gigaton, a private sector consortium aimed at removing one billion metric tons of greenhouse gas by 2030.
Meanwhile in Minneapolis, Target said a sortation center that opened in 2020, powered by technology acquired from Grand Junction and Deliv, is allowing it to test out a more efficient system for shipping from store. That form of last-mile fulfillment is see as having the greatest impact on profit margin, according to research from AlixPartners.
“For years, Target has put our stores at the center of how we serve our guests,” said John Mulligan, Target’s chief operating officer, in its own blog post announcement. “Our new sortation center builds on that model by helping us ship online orders with greater speed and lower costs, while making room for future growth. By adding Shipt to that operation, we’re now testing how we can reach guests even faster with efficient local deliveries.”
The system works by collecting online orders prepared by associates from regional stores to the sortation hub. The technology from Grand Junction and Deliv then determines the most efficient sorting, routing and delivery for each item.
Orders are batched by neighborhood for Target’s courier partners, as well as for Shipt drivers. Mulligan said the hub will be able to service all customers in the metro Minneapolis-St. Paul area by the end of April.