Walmart expands drone delivery service to reach 4 million homes

Walmart is expanding drone deliveries to select stores in six states. This makes it possible for more customers to have diapers, groceries or more delivered by plane.

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Walmart is expanding drone delivery in six states this year, making it possible for many more customers to have a box of diapers or dinner ingredients delivered in 30 minutes or less.

Expanding with operator DroneUp, the big-box retailer said it could reach 4 million homes in parts of Arizona, Arkansas, Florida, Texas, Utah and Virginia. Deliveries by air will be made from a total of 37 stores, 34 of which are operated by DroneUp.

It announced its growth plans in a blog post on Tuesday. Walmart currently offers drone deliveries from a few stores near its headquarters in northwestern Arkansas and in North Carolina.

Walmart has been testing how the small, unmanned aerial vehicle could change the game for retail, fuel the growth of e-commerce and transform its stores in a way to outpace Amazon at speed. Two years ago, it struck deals with three operators – Flytrex, Zipline and DroneUp – and started pilot projects to deliver groceries, household supplies and Covid-19 test kits to customers at home. The company declined to share the terms of the deals.

The new kind of delivery is an extension of Walmart’s strategy of using its massive physical footprint as a competitive advantage. About 90% of Americans live within a 10-mile radius of one of Walmart’s more than 4,700 stores. Through those stores, Walmart has offered a growing list of quick online options, including curbside pickup; InHome, which delivers directly to customers’ refrigerators; and Express Delivery, which delivers items to your doorstep in two hours or less.

Customers who live within range of a Walmart drone delivery site can order thousands of items between 8 a.m. and 8 p.m. Each drone delivery comes with a $3.99 fee. Customers can order items up to £10.

Each order is picked, packed and loaded in-store and flown remotely by a certified pilot to the customer’s yard or driveway. A cable on the drone slowly lowers the package.

Orders must be placed on DroneUp’s website or through the websites of the other two operators. Walmart said it plans to eventually add the ability to place orders to its own website and app.

With the larger network of sites, Walmart can deliver more than 1 million packages per drone in a year, David Guggina, senior vice president of innovation and automation for Walmart US, said in the blog post.

One of the surprises of the drone tests is what customers order, he added. Walmart expected customers to use the drones to get emergency supplies, such as over-the-counter medicines, Guggina said. Instead, he said, many have used it for convenience. For example, in one store, Hamburger Helper is the best seller for drone delivery.

Other common items delivered by drones include batteries, trash bags, laundry detergent and Welch’s fruit snacks, the company said.

Walmart will also use the drones in a different way to make money. It said it plans to offset the cost of supplies by selling photos taken by drones to municipalities and local businesses, such as construction or real estate companies. The proceeds are shared with the drone operator.

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