Retail Pulse: Walmart To Boost Supply Chain In China; JD Sports Rides Athleisure Popularity

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Retailers are bolstering their supply chains in China as they seek to enhance their service and offer customers fresh products. Walmart, for instance, plans to increase its investment in supply chain logistics in the country by $1.2 billion, with efforts to build or upgrade more than 10 logistics distribution centers over the next one to two decades.

Walmart China Senior Vice President Ryan McDaniel said in a blog post, “Walmart continues to increase investment in supply chain logistics in order to enable our omnichannel development, continue to provide our Chinese customers with great, fresh products and improve our service.”

The post also pointed out that the retailer invested over RMB 700 million – which is approximately $100 million – to create the South China Fresh Food Distribution Center. The facility, which has been in operation since March, serves more than 100 Walmart locations in Guangxi and Guangdong.

According to the company, the 33,700-square-meter facility can store and process more than 4,000 different types of frozen or refrigerated products. In addition, the space has advanced temperature-control hardware. The company also pointed out that the storage area’s design “saves more than 330,000 kilowatt hours per year.” Dry warehouses and fresh food distribution centers of Walmart China are said to have dispatched over 300,000 vehicles to stores, resulting in the daily delivery of more than a million boxes of products last year.

Beyond the distribution center, Walmart China is enhancing its logistics efforts in the country with the help of technology. Its supply chain taps into the Data Lake big data platform to enhance analytics and information storage. The company said in the announcement that harnessing a platform for digital management “enables supply chain managers to mobilize and visualize performance management in a more intuitive, convenient manner.” In addition to its data and distribution efforts, Walmart is also innovating with the help of blockchain.

Walmart China, China Chain Store & Franchise Association (CCFA), PwC, Inner Mongolia Kerchin Co., Ltd. and VeChain recently announced the launch of the Walmart China Blockchain Traceability Platform, which is built on the VeChainThor blockchain. Kevin Feng, chief operating officer of VeChainThor, said in a press release, “VeChain will work with Walmart China to actively take heed of the call of the government, by utilizing technology to promote the traceability of fresh food and to provide innovative solutions for the traceability platform through digital technology, so as to generate more transparent and reassuring consumption experience.”

With the help of digital technology and distribution efforts to support its supply chain and logistics, Walmart China is aiming to enable omnichannel innovation while enhancing its service in the country. 

Other Brick-and-Mortar News

British sportswear retailer JD Sports predicted that full-year profit would fall in line with expectations in the midst of rising demand for gym wear, as well as strong sales for new locations. Shares of the owner of Footpatrol and Cloggs jumped as much as 4.4 percent following news that the retailer was experiencing “encouraging” like-for-like core sports fashion sales growth in the U.K. and other markets. JD has over 2,400 locations that offer brands such as Nike, Puma and Adidas.

The company weathered retail gloom with its strong international footprint and online presence. Stifel Nicolaus Analyst Eleonora Dani said, per the report, “It’s likely they are going to pick up market share from other players.” However, the analyst did note it would be more difficult for the retailer to sustain the pace of growth in a trying retail environment. Even so, shares in the retailer have skyrocketed 77 percent this year as the firm rides the millennial preference for athleisure items.

In other news, Uber Eats has added a dine-in service, which appears in the app next to delivery and pickup in some cities. Diners can order food off the menu and opt to go to the restaurant as soon as they can, or can schedule an arrival time in some cases. The app tells the diner how long it will take to make the food, and also provides an estimate for travel time. The customer can then be served upon arrival at the table, while tips can be added either at the table or in-app. Uber reportedly waives delivery and service fees for orders using the dine-in option.

The feature is on offer in Phoenix, Dallas, Austin and San Diego. As an Uber representative told reporters, “We’re always thinking about new ways to enhance the Eats experience.”

On another note, Alphabet-owned drone company Wing is reportedly looking to hire at least 24 people to expand the firm in a field that is becoming more competitive. Wing reportedly wants to expand its delivery service in the United States as well as other countries. The company started as part of Alphabet’s Google X experimental research arm, and has fewer than 200 employees.

To keep tabs on the latest retail trends, check next week’s Retail Pulse.

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