Walmart reportedly testing ‘dark stores’ to speed deliveries

Walmart (NYSE:WMT) is reportedly testing “dark stores”—warehouse-like facilities closed to the public—as part of its push to speed up deliveries and compete more effectively with Amazon.

The company has opened one of these smaller warehouses in Dallas and plans another in Bentonville, Arkansas, with more locations under consideration, Bloomberg reported, citing sources. The new dark stores will stock popular items and are designed to expand delivery range and improve speed.

While Walmart operated similar facilities during the mid-2010s through the pandemic, it later shuttered them. A Walmart spokesperson said the company routinely tests new capabilities to enhance the customer experience.

Walmart (NYSE:WMT) has also ramped up digital initiatives in recent years, including pharmacy delivery and expanding its third-party marketplace. The retailer expects its online segment to turn profitable this year, aided by automation and more efficient order batching to reduce fulfillment costs.

Other retailers are similarly prioritizing faster delivery, often attaching extra fees to offset rising fulfillment costs.

Yesterday, Amazon (AMZN) announced a multi-billion-dollar investment to triple the size of its delivery network with new warehouse and distribution facilities, delivery vehicles, and delivery stations that will be transformed into “hybrid hubs” to serve multiple functions.