Walmart Is Going All-In On Automation To Remain The King Of Retail
Walmart booked more than $514 billion in revenue in its latest fiscal year, making it the world's largest company by revenue. Walmart is also the world's largest private employer with more than 2.2 million employees, counting 1.5 million of them in the United States.
With nearly 5,000 locations scattered across the U.S., nearly 90% of Americans reside within 10 miles of a Walmart store. The vast size and reach of Walmart makes it the largest employer in 21 states.
So why does all of this matter? Over the last week Walmart has expanded its use of robots, which could end up threatening many of these jobs.
Walmart brought its Alphabot out of testing and into an actual store in Salem, New Hampshire last week. The Alphabot is a 20,000-square-foot warehouse containing a robotic fulfillment system that uses autonomous carts to locate an item, pick it and bring it to a workstation where an employee is waiting. In an attempt to give humans something to do, the employee bags the items and then takes them to the customer's car.
In a sign of how little of a chance employees have against the Alphabot, the Alphabot can pick more than 800 products per hour compared to just 80 products per hour for humans. Despite the Alphabot in Salem working at only 20% of its capacity, Walmart has plans to let the robots do more work.
"We will continue to grow this aggressively," Tom Ward, Walmart’s SVP of digital operations, said. "You cannot grow by picking one order in one shopping cart at a time."
Walmart announced it will expand a handful of other technologies that can do the same work as humans and not require pay, benefits or time off. It is expanding its use of the Auto-C floor cleaner, which cleans and polishes floors after the area is prepped by employees. Walmart said in December it would roll out 360 Auto-C floor cleaners by the end of this month, but will now expand the number by 1,500 to bring nearly 2,000 into operation this year.
Walmart also announced it will expand its use of six-foot-tall shelf-scanning inventory robots to 1,000 Walmart stores by the summer. That's a drastic increase from the 350 currently in use and will cover more than 20% of Walmart's U.S. stores. The robot, intended to replace the mundane task of taking inventory, scans shelves and sends missing items to a computer, notifying employees which items they need to restock. It's likely only a matter of time before a robot is built that will also be able to restock the shelves, therefore eliminating the need for humans to restock the shelves.
"Our robot doesn’t have arms right now, so it’s not replacing the manual labor of restocking a shelf," Sarjoun Skaff, co-founder of Bossa Nova Robotics said. "It’s displacing the tedious task of looking for problems, which is really mind-numbing. And in large stores, it’s really hard for a human to compete."
Walmart is also drastically expanding its use of FAST Unloaders, which can unload a truck and sort the merchandise in a fraction of the time it takes employees. Last summer, Walmart had only 30 in operation, but is now planning to add 1,200 more to bring the total to 1,700.
Walmart defends its increased use of technology, saying they are not replacing humans. "We have now added over 40,000 jobs for the online grocery picking role in stores over the last year and a half," a Walmart spokesperson said. "These jobs didn’t exist a short time ago."
In a world where executives seek every last penny of cost savings, Walmart is rapidly adopting technology in its fight with Amazon to be the king of retail. While these technologies are in their infant stages and still being assisted by humans, it's likely only a matter of time before they refine their capabilities and add new ones, thereby threatening the jobs of the 2.2 million employees at Walmart.
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