Walmart’s New Automated Distribution Centers for Fresh Food
Walmart, the largest grocer in the US, is modernizing its supply chain to keep up with the growing demand for online grocery shopping and store pickup. The company is opening five automated distribution centers for fresh food across the country, with the first two already built and tested in Shafter, California, and Lancaster, Texas.
What Are the Automated Distribution Centers?
These facilities are roughly 700,000 square feet on average, with chilled and frozen areas that use automation to store and retrieve perishable items, such as strawberries and frozen chicken nuggets. The automation allows for a more precise picture of inventory and enables the company to get groceries to stores faster.
How Does the Automation Work?
Inside the facilities, the automated storage and retrieval system quickly grabs the items needed to restock store shelves and ferries them to an area where they’re put together into a dense pallet ready for delivery to stores. The robotic system helps push and stack items, putting fragile items like eggs and peaches at the top.
Benefits of Automation
The automation allows Walmart to operate more cost-effectively by better predicting demand and reducing money spent on "safety stock," extra product kept in a warehouse or back of the store to avoid running out completely. The high-tech facilities also allow for more density, with each distribution center having twice the storage capacity and processing more than two times the volume of a traditional site.
Impact on Workers
The automation will bring changes for workers, with some roles being reduced or replaced. However, Walmart expects to have as many overall employees as it has now, or more, in the coming years. The company will need to adapt to the changing roles, with some workers becoming supervisors and others taking on new responsibilities.
What’s Next?
Walmart plans to open the remaining three automated distribution centers in Wellford, South Carolina; Belvidere, Illinois; and Pilesgrove, New Jersey. The company is also expanding four of its traditional distribution centers for fresh food to include automation and retrofitting a legacy facility in Winter Haven, Florida.
Conclusion
Walmart’s investment in automation is a key part of its strategy to grow profits faster than sales over the next five years. The company’s focus on modernizing its supply chain and improving efficiency will help it stay competitive in the rapidly changing retail landscape.
FAQs
Q: What are the benefits of Walmart’s automated distribution centers for fresh food?
A: The automation allows for a more precise picture of inventory, enables faster delivery to stores, and reduces costs by better predicting demand and reducing "safety stock."
Q: How will the automation impact workers?
A: The automation will bring changes for workers, with some roles being reduced or replaced. However, Walmart expects to have as many overall employees as it has now, or more, in the coming years.
Q: How many automated distribution centers will Walmart open?
A: Walmart is opening five automated distribution centers for fresh food across the country, with the first two already built and tested.
Q: What is the size of the automated distribution centers?
A: The facilities are roughly 700,000 square feet on average, with chilled and frozen areas that use automation to store and retrieve perishable items.
Q: What is the timeline for the expansion of automation?
A: Walmart expects to have two-thirds of its stores serviced by some kind of automation and roughly 55% of fulfillment center volume moving through automated facilities by early 2026.
Author: www.cnbc.com
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