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EDITORIAL Walmart: a marketplace to be reckoned with and a boost for returns?

Walmart marketplace: ready for action for UK sellers

US supermarket giant has confirmed what InternetRetailing reported last week that it is to open up its marketplace in the US to UK sellers. While this could be seen as an obvious boon to UK sellers being given a very much needed post-Brexit fillip, it may also presage a move by the giant retailer to take on Amazon – well, in the UK at least.

Announced ahead of its UK Sellers Summit which starts tomorrow (17 June 2022), there are rumours that the move is just a precursor to opening up a UK version of the US marketplace. And that could be interesting: Walmart has consistently chased Amazon in the revenue stakes, never catching it. In 2020, Amazon reported sales of $404bn to Walmart’s $40bn, but such is the size of both companies turnovers they are in a retail league of their own. 

Walmart has consistently looked to its marketplace to extend its sales, opening up to a range of sellers to compliment and augment its own ‘supermarket’ of goods and is a shining example of just how large an enterprise marketplace can become. As reported in the RetailX European Marketplaces Report 2021, many retailers are turning to the creation of their own marketplaces to grow their business, tapping into the consumer hunger for the ease of marketplace shopping and the inevitable impact on price.

Walmart, which has form in the UK, until recently owning Asda, and with as many as 41% of UK shoppers using marketplaces regularly, it is a prime market to tap into. 

For retailers and brands this would be an interesting move. It would certainly offers some competition to the dominant Amazon, but could that very competition between marketplaces actually force seller prices down even further? Great news for consumers, but less so for already hard-hit brands and sellers.

Another boon for consumers could be the impact that marketplace competition – whether with Walmart or just between marketplaces and retailers – could deliver is on returns. There is a growing mood among retailers that returns need to be paid for. They are costly and difficult to arrange and process, so why should they be free. Zara has already announced plans to do so and in response Sendcloud has partnered with payment company Mollie to create a simple payment tool that can sit on retailer websites that allows for easy arrangement and payment of returns fees.

However, while making paying for returns easy may overcome some friction against this, I would argue the bigger problem is getting anyone to shop with you if they know they have to pay to send it back. 

Here a highly competitive marketplace market may well nix this before it gets going. Marketplaces already offer a higher degree of convenience, cheapness and often excellent delivery and return options. With the scale to make returns less onerous to the marketplace bottom line, they could yet have this sewn up. 

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