Walmart Asking for Packages Be Delivered By Employees
The idea, said executives at Walmart on Thursday, is to slash costs on the last-mile for deliveries, when packages are taken to the customer’s home, often times it is the most expensive part of the overall fulfillment process.
Walmart’s CEO of its e-commerce business, Marc Lore said that it makes sense: We have trucks already moving orders to stores to be picked up from fulfillment centers. Lore was the founder of newly acquired Jet.com.
He added that the same vehicles could be used for bringing home orders to a store nearby their final destination, where an associate could deliver them to their final destination.
Walmart started testing the program last month in three of its stores – one in Arkansas and two in New Jersey – but no details were given as to when or where expansion of the service may take place in the U.S.
Employees will receive extra pay for the voluntary program as well as overtime pay if necessary to fulfill the deliveries, said a Walmart spokesperson on Thursday.
Walmart has billed the new program as another way for its employees to earn some extra money, although the company released little information about how the employees would be paid. No information was released as to whether the pay would be based upon time, distance, number of overall deliveries or a combination of one, two or all of them.
Experts in labor said the new arrangement, a mix between an Uber type job and traditional employment, raises many questions related to the employee taking on a great deal of risk, cost as well as the liability associated with the deliveries.
This new program could be subject to abuse if Walmart does not give compensation to workers for the complete cost of the delivery, the expenses of gas, depreciation to their vehicle and possible problems such as tickets, parking expenses and accidents, said one labor professor in New York.
Earlier in 2017, Walmart, which in 2016 reported revenue of $485.8 billion, announced it would increase its minimum wage per hour to $10 for the majority of its employees, but advocacy groups have said many of its employees continue to struggle to pay their bills.
Some employees at Walmart were skeptical of this new delivery arrangement particularly since specifics were not released.
Get Analysts' Upgrades and Downgrades Daily - Enter your email address below to receive a concise daily summary of analysts' upgrades, downgrades and new coverage with MarketBeat.com's FREE daily email newsletter.