Many eCommerce merchants find it difficult to handle order fulfillment on their own. Beyond the operational challenges, performance doesn’t come cheap. According to Statista, 53% of marketers reported that their fulfillment costs increased in 2020.
These increased costs can be attributed to the need for staffing, insurance and storage space. Working with a fulfillment service provider allows sellers to focus on other aspects of their business and continue to grow.
Walmart Fulfillment Services can make order management less time-consuming and costly for sellers. Sellers who want to meet Walmart’s performance standards and expectations understand that fast delivery at low cost plays a role in their success. Merchants using WFS typically see improved visibility in Walmart search results, faster shipping, and ultimately increased business.
Here’s what Walmart sellers need to know to get started with WFS.
What is Walmart Fulfillment Services?
Walmart Fulfillment Services (WFS) is an order fulfillment service that allows sellers to manage inventory for a fee. It’s commonly referred to as Walmart’s “answer to Fulfillment by Amazon.”
When a customer orders from a vendor using WFS, Walmart takes over the ordering process. It fulfills the order, manages returns and provides customer service on behalf of the seller.
According to Gartner, Walmart has one of the most impressive global supply chains. Walmart Fulfillment Services allows merchants to leverage Walmart’s efficient logistics capabilities with a trusted, reliable fulfillment process.
As Walmart grows and expands its market, its fulfillment services will likely grow with it.
Compliance
To qualify for WFS, you must be an existing Walmart Marketplace seller. In addition, your product must meet the following requirements:
- Products must be shipped to Walmart fulfillment centers from the United States
- Non-perishable or regulated goods
- Items cannot weigh more than 30 pounds
- Product dimensions must not exceed 25 x 20 x 14 inches
You must also be in good standing with the platform, with a history of on-time orders, high customer satisfaction and overall quality service.
While Walmart has been notoriously slow with app approvals, vendors have reported a month-over-month increase in applications.
Value
One of Walmart’s stated selling points is the simple pricing structure of Walmart Fulfillment Services. As Walmart’s website states, “Enjoy a simple cost structure that includes a fixed monthly storage fee and a fulfillment price based only on the weight of the shipment.” However, clothing and apparel products are exempt from this pricing structure.
From August 20, 2021, the price of the program begins $3.45 for goods weighing under 16 oz or 1 lb.
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Sellers can expect to pay $0.75 per cubic foot for storage space every month from January to September. However, the $0.75 fee only applies to in-stock items Less than 30 days October to December.
Longer saved items will be added $1.50 / cubic foot with a total cost per month $2.25 / cubic foot monthly. This article offers more insight into WFS fees.
Walmart Fulfillment Services vs. Amazon FBA. What is the difference?
WFS is often touted as Walmart’s answer to Fulfillment by Amazon (FBA). However, despite frequent comparisons, WFS and FBA are very different fulfillment services with distinct advantages.
- While customers without Amazon Prime cannot access one- and two-day shipping, WFS offers free two-day shipping on all orders over $35— No Walmart+ membership required.
- WFS has never had any major issues with 2 day shipping. Amazon’s shipping took a hit at the start of the COVID-19 pandemic, as it was unable to maintain two-day shipping. It’s true that WFS handles less shipping volume, but a strong shipping record is still likely a good indicator of future success.
- The process the delivery of goods is simpler. FBA requires sellers to hold inventory at multiple fulfillment centers, but Walmart sellers must only ship to one or two Walmart fulfillment centers.
Neither service is perfect. Ultimately, the choice to use a marketplace service for your business should be determined by your business model.
Advantages and Disadvantages of Walmart Fulfillment Services
There is no better third-party fulfillment option for Walmart sellers than the one offered by Walmart itself. By offering fast shipping at a reasonable price, Walmart Fulfillment Services allows merchants to focus solely on the bottom line of their business.
Benefits:
If you’re wondering whether to make the move with Walmart Fulfillment Services, the program offers several benefits that can help you make a decision.
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- Fast delivery. WFS sellers may offer two-day shipping on their products.
- Simple pricing structure. Compared to platforms like Amazon’s FBA, which have hidden fees that sellers must always be on the lookout for, WFS’s pricing structure is straightforward.
- Clean report. With easy-to-read dashboards, sellers can keep track of their orders and inventory.
- Supporting your customers and your business. WFS provides customer service on behalf of sellers, managing all inquiries, chargebacks and returns. Sellers can also get help from WFS customer service if needed.
- Increased search visibility. Sellers using WFS are automatically assigned Walmart’s TwoDay tags. Walmart prioritizes sellers with a two-day tag on their products, so sellers can achieve higher rankings and Buy Box priority in Walmart Marketplace searches.
The benefits Walmart sellers will experience using this service will likely improve as WFS is still in its early stages and will only grow as Walmart expands and attracts more customers to the platform.
Disadvantages:
WFS is a fairly new program with Walmart launching it in February 2020. Its newness and low user base mean that there are issues that sellers will encounter when using it. To provide as much information as possible, vendors should also understand the drawbacks associated with WFS.
- Strict rules. Merchants cannot sell the same products through WFS as they do through other fulfillment services such as FBA. If found, sellers risk having their Walmart operations terminated.
- Geographical restrictions. WFS only ships to the US Sellers can ship to all 50 states, some military addresses, American Samoa, Guam, Northern Mariana Islands, Puerto Rico and the US Virgin Islands.
- Product size limitation. Walmart has very limited product sizes, so some sellers may not be able to use the service.
Despite the program’s limitations, the WFS program is still worth pursuing for Walmart sellers.
How to set up Walmart Fulfillment Services
Getting started with WFS is pretty simple as long as you’re a Walmart Marketplace seller. If you are not, visit the Walmart Fulfillment Services Interest Form. Walmart recommends sellers have the following details on hand before starting their seller application:
- US Business Tax ID. Social Security numbers are not accepted
- Major product categories, catalog size, and related information (such as the total SKUs you initially plan to carry with WFS)
- Planned integration method for your product catalog (i.e. how you plan to add your existing inventory to the platform. Some options given are bulk upload, API, and external solution provider)
For existing Walmart sellers, simply log into your Seller Center account and use the WFS link in the marketplace dashboard to start the process.
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Walmart then reviews your application. If accepted, you will need to convert your product to listings carried by Walmart.
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Remember that any product you intend to register for the program must also be listed on the Walmart Marketplace.
Next, you’ll ship your inventory to Walmart’s fulfillment centers, where the items will be held until the customer orders. Orders from Walmart warehouses are then packed and shipped.
Strengthen your business with Walmart Fulfillment Services
By removing the burden of performance, WFS vendors can improve their operations to meet and exceed Walmart’s standards. Merchants can focus on meeting Walmart’s expectations by offering:
- Products that are new to the market
- Competitive pricing
- High quality listings
- Sufficient inventory to meet customer demand
Combining the right business model with WFS will help you grow your business significantly on the platform.
New to Walmart and want to start selling? Check out 5 Reasons Why You Should Sell on Walmart Marketplace for more details.