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Walmart rolled out its third-party marketplace to foreign sellers, who no longer need a U.S. address or business tax identification for trading. Walmart Inc. has removed rules requiring sellers on its marketplace website to be registered in the U.S. \u2014 an attempt to close the e-commerce gap with Amazon.com Inc. and tap into China\u2019s vast network of manufacturers.<\/p>\n
Walmart is looking to expand its marketplace, where suppliers can offer their products via its website and its allied services, like fulfillment and advertising. For retailers, marketplaces are attractive because they provide revenue from fees without the cost of storing inventory. Last year, Walmart began offering fulfillment services for its marketplace sellers, a move that Amazon made 15 years ago. Sellers can also purchase advertising on Walmart\u2019s websites, supporting the company\u2019s new Walmart Connect media platform. The vendors still will be carefully vetted, both locally and by Walmart\u2019s global trust and safety team, to prevent the listing of unsavory items. The new sellers will make up just a fraction of Walmart\u2019s total seller population, which is mainly based in the U.S.<\/p>\n
Chief Executive Officer Doug McMillon has said that Walmart\u2019s marketplace business is a \u201chuge opportunity<\/em>\u201d for the retailer. In February 2020, he told investors that Walmart would make a \u201cgreater push<\/em>\u201d to expand new services like fulfillment. \u201cWe have strong relationships with many reputable companies around the world, and we have some of the most rigorous seller requirements in the industry<\/em>,\u201d Walmart said in an emailed statement. \u201cAs a result, we are opening our U.S. marketplace to a limited number of international companies who share our commitment to customer trust and safety<\/em>.\u201d<\/p>\n Hurdles in the Way<\/strong><\/span><\/p>\n However, the opening of the doors poses several risk factors as well. Walmart\u2019s marketplace has faced flak for carrying offensive items that hurt sentiments for certain segments of society. A while back, Walmart had to take down about 20 million items off its marketplace as it failed to meet its quality standards. AS opposed to the Amazon\u2019s marketplace, which is open to anyone who registers, Walmart is invite-only, allowing the company to vet its sellers. Walmart has also made deals with Shopify Inc. and BigCommerce Inc. over the past year to widen its reach.<\/p>\n Rise of the Chinese Manufacturers<\/span><\/strong><\/p>\n Chinese manufactures have tapped into the American customer base by reaching out to them through online marketplaces. According to researcher Marketplace Pulse, Chinese merchants represented 75% of new Amazon marketplace sellers, an increase from 47% a year earlier.<\/p>\n Walmart also foresees this same trend to be replicated in their online marketplace as well.<\/p>\n \u201cThis will get Walmart more selection, more affordable goods that already dominate Amazon best-sellers lists<\/em>,\u201d said JuozasKaziukenas, founder and CEO of Marketplace Pulse. \u201cTo an investor, that reads as positive news<\/em>.\u201d<\/p>\n