Walmart Fulfillment Services vs. Amazon FBA

Walmart Fulfillment Services is Walmart's answer to Amazon’s FBA. Both platforms’ ultimate goal is to help sellers get more revenue and conversions. But what are the advantages? Learn about it here.

In 2020, Walmart became the world's biggest company by revenue by generating $559 billion in sales, compared to Amazon with $386 billion. In the same year, Walmart also released Walmart Fulfillment Services, a program that gives its sellers access to their world-class supply chain. It’s also a direct competitor to Amazon’s FBA program.

Amazon's FBA has been a popular choice for years but ever since Walmart Fulfillment Services launched, more and more sellers are now starting to pay attention to this program because of its benefits. Since it launched in February 2020, WFS has been receiving praise from sellers who've adopted it.

But what really is the difference between the two? What are the advantages? And how do you know which one is better for your brand? We’ll go over each so you can make an informed decision.

The Advantages of Using Walmart Fulfillment Services

As of August 2021, Walmart Marketplace has reached over 100,000 sellers on its platform. According to an article by Modern Retail, even if WFS had a rough start for several months when it started with just 150 enrollees, it had a sharp jump on the number of sellers enrolled in the program just after a few months. This just means that Walmart is placing a priority on the growth of its fulfillment program.

1. Faster Shipping

According to Walmart, there is a 30% higher conversion rate if you offer a 2-day shipping window compared to 5 days and above. With WFS, brands can offer nationwide 2-day shipping on all their products. This can improve searchability and Buy Box percentage.

2. Better Reporting

Walmart is closely working with its sellers on creating their dashboards. These dashboards help sellers understand their product performance, identify products not yet sold on their platform, and other metrics that can help them improve their overall performance on the platform.

3. Convenient Return Policy

Walmart's return policy is easy and free. Walmart will manage all returns on the seller’s behalf, and because Walmart has over 5000 stores nationwide, customers can choose to return their items at any nearest stores or they can return their items by mail. Buyers can choose which option best fits their schedule.

4. Excellent Customer Service

With WFS, Walmart assumes ownership of all post-sale processes including customer service. They have their dedicated customer service line for WFS to prioritize support tickets and to allow a faster response rate. This gives sellers more time to focus on growing their sales on Walmart, instead of dealing with customer inquiries, returns, etc.

5. Individual Inventories

One of the issues with Amazon FBA is that their authentic brands are being accused of selling counterfeits because of their commingled inventory system. This won’t be a problem with WFS because they have a dedicated inventory pool for each seller at no additional cost.

6. Beginner Friendly

If you’re new to eCommerce or unsure if you’re going the right way, WFS is also the better option because it is easier to correct mistakes because the platform is also newer. Walmart will have dedicated WFS call center associates to answer all seller questions.

7. Lower Fulfillment Costs

Walmart has a large-scale supply chain so sellers can offload some of their logistical costs in exchange for a monthly fee. The money they saved can be used to reinvest in their products, increase their assortment, or give discounts to their customers. This is the reason behind the incredible GMV growth of brands in WFS.

The Advantages of Using Amazon’s FBA

Based on Jungle Scout's report, there are nearly 3 million active sellers on Amazon and almost 92% sell using Amazon FBA. Nearly all Amazon sellers (92%) sell using Amazon FBA, and two out of five (43%) use Amazon FBM. Here are some of the advantages of using its fulfillment services.

1. Size & Weight Restrictions One advantage of using Amazon FBA is that most product types and sizes are accounted for. They don’t have any size and weight restrictions so they accommodate more sellers. For WFS, the maximum product weight is 30 lb and the maximum product dimension is 25″ x 20″ x 14″. Amazon’s FBA accepts oversize items up to 151 lbs with max. dimension 108" on the longest side.

2. Multichannel Fulfillment

Right now there is only one Walmart fulfillment center designated for the WFS program. But for Amazon’s FBA, sellers can ship through multiple fulfillment centers. Amazon can fulfill orders both on and off the Amazon marketplace. Some of their fulfillment houses also invest in technology and automation which makes them more efficient.

3. Access to Prime audience By using Amazon FBA, brands are eligible to be included in Amazon Prime deals. With over 100 million Prime members, this can increase brand awareness among a Prime audience resulting in more sales.

4. Customer Trust

Since Amazon FBA has been around much longer than WFS, customers have come to trust the Amazon and Amazon Prime logos more. This improves customer perception of brands’ fulfillment capabilities.

5. Return Methods

There are more ways to return an item in FBA compared to WFS. Here are the different ways:

• Using drop off services at locations that are convenient for you (Whole Foods, Kohls)

• Using pickup options

• Using Heavy-Bulky return options, handled by a specialty carrier team

• Using Locker, Locker+, and Amazon Hub Counter locations for small packages

• Using a scanned QR code at designated returns locations to make label-free and package-free returns
  

Conclusion

Selecting the right fulfillment service is a critical decision for sellers, especially if you're just getting started. Both Amazon's FBA and Walmart's WFS have a lot of similarities too. Furthermore, nothing prevents sellers from using both services if they think it's best for their brand.

If you want to learn more about the different eCommerce fulfillment options on various platforms like Walmart.com and Amazon, then you can contact our fulfillment experts here.