Shopify and Walmart herald new third-party selling partnership

Bentonville, Ark.-based retail behemoth Walmart and Ottawa-based Shopify, a multi-channel commerce platform, announced a new partnership today, in which they will launch a channel that will enable Shopify merchants to sell their products through Walmart.com, with the goal to add 1,200 Shopify sellers in 2020.

The companies said that this marks the first time Walmart has established a partnership with a commerce platform that give small to medium-sized businesses (SMB) to the ability to sell its online marketplace.  

“Shopify’s new Walmart channel will enable our merchants to get products in front of these high-intent, loyal buyers from one of the world’s largest retailers, helping them expand their reach and drive sales,” Shopify said in a statement.

And effective today, it added that Shopify merchants throughout the U.S. can now sell through Walmart.com, and, if approved, can connect their Shopify store to their Walmart seller account to synch their product catalog and create product listings on Walmart.com. Shopify added that merchants activating the Walmart channel through Shopify will obtain access to inventory and order management from within Shopify and bulk marketplace listings.

In a blog posting, Jeff Clementz, vice president, Walmart Marketplace, wrote that Walmart’s U.S. e-commerce business grew 74% in the first quarter, with growth in marketplace outpacing the over all business, while first party sales were strong.

“As we launch this integration with Shopify, we are focused on U.S.-based small and medium businesses whose assortment complements ours and have a track record of exceeding customers’ expectations,” Clementz wrote. “We’re excited to be able offer customers an expanded assortment while also giving small businesses access to the surging traffic on Walmart.com. Shopify powers a dynamic portfolio of third-party sellers who are interested in growing their business through new, trusted channels. This integration will allow approved Shopify sellers to seamlessly list their items on Walmart.com, which gives Walmart customers access to a broader assortment.”

A Bloomberg report stated that this partnership comes at a time when its $21.5 billion U.S. e-commerce business, which is “gaining ground on Amazon,” is still in the red financially. It also pointed to how Walmart introduced a fulfillment service for third-party sellers, allowed customers to return marketplace items in its physical stores and jettisoned millions of third-party items that didn’t meet quality standards.

Looking at this partnership from a logistics perspective, Chase Flashman, co-Founder and CEO of Indianapolis-based ShipSights said that not only will this partnership benefit Walmart as it continues to put pressure on Amazon's e-commerce dominance, but it will also benefit FedEx who has a long-standing relationship with Walmart.

“Similar to Walmart closing in on Amazon, FedEx could likely do the same with UPS despite both small parcel providers having existing separate agreements with Shopify,” said Flashman. “Shippers, of course, faced with increasing options such as the Walmart/Shopify partnership, will have to weigh which options are best for them—from a cost perspective and a service level perspective in order to grow their businesses profitably.”

And Jerry Hempstead, president of Hempstead Consulting, observed that Shopify has a platform that is very affordable and allows anyone who wants to develop a “shop” online by providing primarily IT tools for myriad online retailers.

“This partnership with Walmart gives these purveyors on the Shopify platform access to millions of eyes each month that go to the Walmart.com site,” he said. “The number of people shopping at the Walmart site is growing (watch your back, Amazon), and this marriage helps both firms move more transactions through the switch, which then results in lower costs. It’s a good marriage and makes great sense for both.”