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Walmart Partners With Shopify in Its Biggest Move Yet to Take on Amazon

By Danny Vena – Updated Jun 15, 2020 at 4:29PM

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The move will add thousands of new small businesses to Walmart's e-commerce platform.

Walmart (WMT -0.93%) announced on Monday that it was joining forces with Shopify (SHOP -2.50%), opening its marketplace to Shopify merchants. The move will expand the company's online sales platform and better position it to compete with e-commerce leader Amazon.com (AMZN -0.54%)

The world's largest retailer said it hoped to add as many as 1,200 Shopify sellers to its platform by the end of the year. Walmart plans to focus on small- and medium-sized U.S.-based business that have an assortment of products that complement its own, while also looking for companies with a "track record of exceeding customers' expectations."

Shopping cart Icon on smart phone screen.

Image source: Getty Images.

Shopify merchants that sell through Walmart will be able to manage their inventory and have products automatically synced with Walmart.com. Those with a large quantity of products will be able to add them in bulk. An added benefit for merchants is that they won't be charged the listing fees that sellers typically pay to other marketplaces like Amazon.

More than 120 million U.S. consumers visit Walmart's e-commerce site every month, and Shopify said the partnership will "enable our merchants to get their 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."

Third-party sellers represented more than half of the units sold on Amazon, and generated $14.48 billion in the first quarter, up 30% year over year, and representing 19% of Amazon's revenue. Third-party sellers are typically more profitable, often footing the bill for delivery charges.  

Walmart's U.S. e-commerce business surged 74% last quarter as a growing number of consumers adopted online retail as their primary shopping venue, forgoing trips to brick-and-mortar stores in the face of the COVID-19 pandemic.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Danny Vena owns shares of Amazon and Shopify. The Motley Fool owns shares of and recommends Amazon and Shopify and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Walmart Stock Quote
Walmart
WMT
$131.68 (-0.93%) $-1.24
Shopify Inc. Stock Quote
Shopify Inc.
SHOP
$30.06 (-2.50%) $0.77
Amazon.com, Inc. Stock Quote
Amazon.com, Inc.
AMZN
$120.30 (-0.54%) $0.65

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