The pilot, according to news from CNBC — which is being tested at Walmart locations in North Carolina, South Carolina, Virginia, Arkansas, Texas and Colorado — has already exceeded expectations. Consequently, the small-format shops will be unveiled at 500 Walmart locations over the course of the next two years.
“We gravitated toward Walmart because they have this fantastic physical infrastructure,” Brian Philips, CEO of FedEx Office, told CNBC. “We are already great partners with Walmart on the transportation side, so it was natural for us to talk about a store-within-a-store format.”
Walmart-based FedEx Office locations will also offer customers the option of having their packages held in-store for as many as five business days as a defense against porch pirates snapping up inventory from customers’ homes while they’re away.
And while consumers are picking up their packages, the pilot data shows they’re sticking around to get some shopping done as well, thus boosting the retailer’s foot traffic. FedEx’s printing business within Walmart has also surpassed the company’s predictions during the trial period, according to Philips.
The pint-sized shops are 450 to 750 square feet and will be staffed by around 2,000 FedEx employees across all locations.
Walmart and FedEx already partner on shopping. The tie-in will reduce some friction for both in handling the last-mile element of online sales. That last-mile concern (and cost) has become a top priority for many in the retail game: Amazon has started using Whole Foods stores, malls and a variety of locations for its pick-up lockers. Target recently acquired Grand Junction and grocery delivery service Shipt to bolster its supply chain.
“Retailers are looking at all the tools at their disposal,” Philips said. “Everybody has these assets, and they are trying to figure out how to make them omnichannel,” meshing online and offline commerce. “FedEx is a nice glue that holds that together,” he added.
For Walmart, the decision to host FedEx mini-stores was the result of a recent poll that asked consumers what they would most like to see added to the retailer’s service lineup. Packaging and shipping services topped the list, according to Senior Vice President of Walmart Services and Digital Acceleration Daniel Eckert.
“Our busy customers view our stores as a one-stop shop for all the products and services they are looking for,” he said.