Walmart Commerce Technologies Launches AI-Powered Logistics Product

Rhea-AI Summary

Walmart introduces Route Optimization, an AI-powered logistics technology, as a SaaS solution to enhance businesses' efficiency in the middle mile, reduce emissions, and optimize driving routes.

Insights

Supply Chain Management Expert

Walmart's decision to offer its Route Optimization technology as a SaaS solution represents a significant strategic move in the retail and logistics sectors. By leveraging AI to enhance the efficiency of the 'middle mile,' Walmart is addressing a critical pain point for many businesses: the complexity of supply chain management. This technology has the potential to reduce operational costs for users by optimizing driving routes and trailer packing, which can lead to substantial savings on fuel and labor, as well as a reduction in carbon emissions.

Walmart's reported success in avoiding 94 million pounds of CO² and eliminating 30 million unnecessary miles showcases the tangible environmental and economic benefits of the technology. Companies adopting this solution may see improvements in their Environmental, Social and Governance (ESG) metrics, which are increasingly important to investors. Moreover, the potential for enhanced on-time delivery performance could lead to higher customer satisfaction and retention rates, thereby impacting revenue positively.

Environmental Analyst

The environmental implications of Walmart's Route Optimization technology are noteworthy. The reduction of unnecessary miles and CO² emissions aligns with a broader industry trend towards sustainability. By optimizing supply chain logistics, businesses can contribute to a greener economy, which is a critical consideration for stakeholders concerned with corporate responsibility and sustainability. The ability to minimize empty backhauls through strategic inventory pickups further enhances the environmental value proposition of this technology.

For companies under pressure to demonstrate sustainability progress, adopting this technology could serve as a key differentiator and a step towards achieving carbon neutrality goals. It may also attract environmentally conscious consumers and investors, potentially influencing stock valuations positively for businesses that integrate such solutions into their operations.

Technology Market Analyst

Walmart's entry into the SaaS market with Route Optimization indicates a growing trend of traditional retailers diversifying into tech services. This move could open up new revenue streams for Walmart and potentially disrupt the logistics tech industry. As businesses search for ways to remain competitive, adopting advanced technologies like AI-driven logistics solutions could become a necessity rather than a luxury.

The technology's ability to provide at-a-glance insights and adapt to external variables such as weather and traffic patterns exemplifies the advanced analytics capabilities that many companies lack in-house. This could lead to increased demand for Walmart's offering, influencing the stock market by positioning Walmart not only as a retail giant but also as a tech solutions provider. The success of this service will depend on its adoption rate and how it compares to existing logistics solutions in terms of cost and performance.

Walmart aims to strengthen retail everywhere by offering its proven tech to other businesses;

Latest solution enhances the efficiency of the middle mile, allowing businesses to more consistently keep their customers’ desired products in stock

BENTONVILLE, Ark.--(BUSINESS WIRE)-- For years, Walmart has used AI to create a more efficient supply chain, reducing emissions while helping to ensure more of the items its customers want are available where, when and how they want them. Today, the company is making that same award-winning, AI-powered logistics technology — Route Optimization — available to all businesses as a Software as a Service (SaaS) solution through Walmart Commerce Technologies.

“We have invested significant time, resources and operational knowhow into building solutions like Route Optimization, but that can be a barrier for many businesses,” said Anshu Bhardwaj, Senior Vice President and Chief Operating Officer, Walmart Global Tech and Walmart Commerce Technologies. “By adopting our at-scale, AI-powered tech, businesses can eliminate the need and expense of developing their own technology, and instead focus on what they do best – serve their customers."

Route Optimization provides businesses of all sizes the use of AI-driven software to optimize driving routes, pack trailers efficiently and minimize miles traveled. Using this same custom technology, Walmart avoided 94 million pounds of CO² by eliminating 30 million unnecessary miles driven and optimized routes to bypass 110,000 inefficient paths. Walmart won the prestigious Franz Edelman Award in 2023 for building and deploying this technology at scale.

Now, Walmart is offering Route Optimization to other businesses to boost their own performance and make sure their customers can find what they are looking for by:

• Better planning for a truck’s multi-stop journey – AI-driven automated route mapping considers factors such as time, location, and store delivery windows
• Packing trailers in the most efficient way possible — not only maximizing space but also helping to ensure temperature-controlled items stay fresh
• Ensuring stores receive deliveries on time, regardless of external variables, by leveraging weather and traffic patterns and quickly pivoting as needed
• Strategically planning inventory pickup (backhauls) on return trips from deliveries to ensure trailers are never empty, ensuring efficiency and a greener footprint
• Providing at-a-glance insights such as trailer usage, trip time and distance traveled without cargo to help operations management teams make faster, more informed decisions

Walmart has pioneered and scaled innovative omnichannel technologies for more than a decade. Route Optimization is Walmart’s second turnkey, white-label solution, joining Store Assist, a SaaS technology that provides local fulfillment including shipping, pickup and delivery.

About Walmart

Walmart Inc. (NYSE: WMT) is a people-led, tech-powered omnichannel retailer helping people save money and live better - anytime and anywhere - in stores, online, and through their mobile devices. Each week, approximately 255 million customers and members visit more than 10,500 stores and numerous eCommerce websites in 19 countries. With fiscal year 2024 revenue of $648 billion, Walmart employs approximately 2.1 million associates worldwide. Walmart continues to be a leader in sustainability, corporate philanthropy, and employment opportunity. Additional information about Walmart can be found by visiting corporate.walmart.com, on Facebook at facebook.com/walmart, on X (formerly known as Twitter) at twitter.com/walmart, and on LinkedIn at linkedin.com/company/walmart.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240314754136/en/

Erin Hulliberger

1-800-331-0085; https://corporate.walmart.com/news/contact-media-relations

Source: Walmart Inc.

FAQ

What is Walmart's new AI-powered logistics technology called?

Walmart's new AI-powered logistics technology is called Route Optimization.

How does Route Optimization help businesses?

Route Optimization helps businesses optimize driving routes, pack trailers efficiently, minimize miles traveled, and ensure timely deliveries.

What award did Walmart win for Route Optimization?

Walmart won the prestigious Franz Edelman Award in 2023 for building and deploying Route Optimization at scale.

What other white-label solution does Walmart offer besides Route Optimization?

Besides Route Optimization, Walmart offers Store Assist, a SaaS technology for local fulfillment including shipping, pickup, and delivery.

How does Walmart's Route Optimization contribute to reducing emissions?

Walmart's Route Optimization helps reduce emissions by eliminating unnecessary miles driven and optimizing routes to bypass inefficient paths.