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Walmart’s Earnings Call Is A Delight For Supply Chain Professionals
After having too much inventory for several quarters, driven by supply/demand mismatches caused by COVID, they returned to inventory efficiency. The world’s largest retailer had lower markdowns, improved in-stock service levels, and lower inventory. Walmart’s U.S. inventory was down 4.5%, Sam’s was down over 8%. In the US, the company is investing in automation that they predict will lead to a higher level of inventory accuracy over the next few years. Walmart reports that investments in artificial intelligence have also improved inventory management.
Sam’s Club performed 35 million fewer tasks in the store last year. A lot of that was artificial intelligence that helped associates manage inventory better. They also report using RFID and computer vision, as well as digital displays and labels, to improve operations. New digital tools that automate repetitive tasks or eliminate heavy lifting have increased associate productivity and customers are benefiting from improved in-stock rates and associate accessibility, leading to customer experience scores up over 140 basis points in fiscal year 2024.
On the logistics front, the retail behemoth reports that they have retrofitted 13 regional distribution centers with varying levels of automated storage and retrieval systems. They are implementing technology from Symbotic in a phased deployment. The level of automation in a Symbotic solution is hard to grasp; it really has to be seen to be believed.
Symbotic: Reimagine the Supply Chain
SoftBank Group and Symbotic Establish New Warehouse-as-a-Service Joint Venture
SoftBank Group Corp. (TSE: 9984, “SoftBank”) and Symbotic Inc. (Nasdaq: SYM), a leader in A.I.-powered automation technology for the supply chain, today announced the establishment of GreenBox Systems LLC (“GreenBox”), a new joint venture to address the more than $5001 billion annual warehouse-as-a-service market opportunity. Concurrently, Symbotic also announced an approximately $7.5 billion new customer contract with GreenBox, who will be the exclusive provider of Symbotic systems in the warehouse-as-a-service market, and will make supply chain services available to customers.
SoftBank and Symbotic own 65% and 35% of GreenBox, respectively, with the joint venture established today. GreenBox will initially be funded with $100 million of capital contributed pro rata by Symbotic and SoftBank to fund operating expenses and initial system purchases. After Symbotic’s initial $35 million pro rata capital contribution, the contract is expected to be accretive to Symbotic’s annual free cash flow (net of capital contributions).
Walmart and Symbotic Expand Partnership to Implement Industry-Leading Automation System
Symbotic LLC, a revolutionary A.I.-powered supply chain technology company, and Walmart Inc. announced an expanded commercial agreement to implement Symbotic’s robotics and software automation platform in all 42 of Walmart’s regional distribution centers over the coming years. This is an expansion of Walmart’s prior commitment to deploy Symbotic Systems in 25 regional distribution centers.