When we talk about e-commerce success, it is often measured by the numbers. Regarding giants like Amazon and Walmart, the competition is fierce, and annual revenue figures provide a compelling metric for comparison.
Surprisingly, the financial reports for 2022 have revealed that Walmart has outpaced Amazon with an annual revenue of $572.8 billion, significantly surpassing Amazon’s $514 billion. This revelation is more than just a headline; it’s a testament to the immense potential of Walmart’s e-commerce platform, Walmart Marketplace.
So, if you’re an e-commerce entrepreneur looking to boost your business, the question is no longer “Why Walmart Marketplace?” but rather, “Why not?”
This article will explore why you should consider selling on Walmart Marketplace and how it can empower your e-commerce business to thrive in a supersaturated e-commerce landscape.
Potential of Selling on Walmart Marketplace
Walmart’s Dominance
Let’s start by looking at critical statistics underlining the significance of selling on Walmart Marketplace. In fiscal year 2022, Walmart generated a staggering $572.8 billion in net sales. This impressive figure speaks volumes about the company’s reach and customer base. With 10,623 locations across the United States, Walmart has an unrivalled physical presence, giving it a significant advantage in brand recognition and trust.
Walmart Marketplace Traffic
The website’s remarkable traffic is one of the most compelling reasons to consider selling on Walmart Marketplace. On average, Walmart receives a whopping 382.1 million visits per month. This massive online footfall provides sellers with an extensive customer base, many of whom are already loyal Walmart shoppers. By listing your products on Walmart Marketplace, you gain access to this vast pool of potential customers, significantly increasing your brand’s exposure and sales potential.
Mobile App Downloads
The significance of mobile commerce must be considered in today’s digital landscape. Walmart’s shopping app, available on Google Play, boasts more than 50 million downloads. This statistic highlights the growing trend of mobile shopping and the convenience it offers consumers. By selling on Walmart Marketplace, you tap into this mobile user base, making it easier for customers to discover and purchase your products on the go.
Advantages of Selling on Walmart Marketplace
Now that we’ve established the impressive statistics surrounding Walmart Marketplace let’s explore the advantages of having a seller account on Walmart.
Trust and Credibility
Walmart is a household name known for its commitment to quality and customer satisfaction. Associating your products with the Walmart brand can build trust among potential customers.
Reduced Competition
While Amazon is undoubtedly a major player in e-commerce, Walmart Marketplace offers an opportunity to stand out in a less saturated marketplace. This can be especially advantageous for smaller or niche businesses looking to establish themselves.
Get Access to Free 2-day Shipping
Sellers on Walmart Marketplace have the advantage of offering their products with free 2-day shipping. This is a significant draw for customers who value fast delivery. It helps improve the customer experience and can lead to increased sales. For example, if a customer is searching for a product and sees that it’s eligible for free 2-day shipping, they are more likely to choose that item over a similar one with a longer delivery time.
No Monthly Fees
Unlike some other e-commerce platforms, Walmart Marketplace does not charge monthly subscription fees for sellers. This is a cost-saving benefit, especially for small businesses and entrepreneurs. Sellers can list their products on Walmart without incurring fixed monthly expenses, making it a more accessible platform for a wider range of sellers.
Easy Checkout Process
Walmart Marketplace offers a straightforward and user-friendly checkout process. This ease of use can lead to higher conversion rates and fewer abandoned shopping carts. A streamlined checkout process ensures customers complete their purchases with minimal friction, contributing to a better shopping experience.
You Only Pay When You Make a Sale
You are only charged a referral fee when a sale is made. There are no upfront costs for listing your products, making it a cost-effective option for sellers. You pay a percentage of the final sale price, which varies by category. This pricing model aligns your costs with your revenue.
Access to Analytics Tools
Walmart provides sellers access to various analytics tools and reports to track their performance and gain insights into customer behavior. These tools can help you make data-driven decisions, optimize your product listings, and adjust your strategies to improve your sales and profitability.
Walmart Fulfillment Services
Walmart offers its own fulfillment service similar to Amazon’s FBA (Fulfillment by Amazon). By using Walmart Fulfillment Services, you can store your inventory in Walmart’s warehouses, allowing for faster and more reliable order processing. This service helps you meet the free 2-day shipping requirement and enhances the customer experience.
Outsource Fulfillment to a Walmart-Approved Partner
If managing your Walmart inventory and fulfillment differs from your preference, Walmart allows you to outsource these functions to Walmart-approved third-party partners. This flexibility enables sellers to focus on other aspects of their business, such as product development and marketing, while still delivering a high level of service to customers.
Who Can Sell on the Walmart Marketplace?
Before going to start selling products at Walmart, it’s essential to understand the requirements and qualifications for prospective sellers. To ensure a smooth onboarding process, Walmart has specific criteria that third-party sellers must meet.
Let’s break down the essential qualifications and prerequisites for those looking to join the Walmart Marketplace community.
1. U.S. Business Tax ID or Business License Number
Third-party sellers must possess a valid U.S. business tax ID or license number to establish legitimacy and accountability. This identification verifies the seller’s legal existence and aligns with Walmart’s commitment to maintaining a trustworthy and compliant marketplace.
2. Documents Proving Business Address and Name
Sellers must provide authentic documentation that validates their business address and name. This verification process is crucial to ensuring that the business operates from a legitimate physical location and adheres to Walmart’s standards for transparency.
3. A History of Success on Other E-commerce Platforms
Walmart Marketplace places a premium on experience and a track record of success. Prospective sellers should demonstrate their capability by showcasing a history of effective sales on other e-commerce platforms like eBay, Etsy, Shopify, or Amazon. This criterion underlines Walmart’s commitment to partnering with seasoned and reliable sellers.
4. Products with GTIN/UPC GS1 Company Prefix Numbers
Each product listed on Walmart Marketplace must have a unique identifier, akin to a fingerprint, in the form of GTIN/UPC GS1 Company Prefix Numbers. This system facilitates the management of product listings and ensures product integrity and identification.
5. Compliant with Walmart’s Product Policy
Walmart maintains an extensive product policy that governs the types of items that can be listed on its platform. Sellers must ensure that their products align with Walmart’s guidelines. Some items, such as ink, toner, and offensive material, are restricted or prohibited. For specific product categories, sellers may need pre-approval from Walmart before listing their items.
6. Fulfillment with Walmart Fulfillment Services (WFS) or U.S.-Based Warehouse
To guarantee efficient order management on Walmart, sellers must fulfill orders through Walmart Fulfillment Services (WFS) or a U.S.-based warehouse that can handle returns. Fulfillment services offered by Walmart are designed to meet the stringent requirements for free 2-day shipping and high-quality customer service, enhancing the shopping experience for customers.
7. Proof of Incorporation for International Sellers
For international sellers, providing proof of incorporation is essential. Sellers based in one of the approved countries, including Canada, the U.K., China, India, Hong Kong, Japan, Mexico, Germany, South Korea, Singapore, or Taiwan, must demonstrate their legal incorporation in their respective country. This verification ensures that international sellers meet the regulatory standards for cross-border commerce.
How Much Does it Cost to Sell on Walmart Marketplace?
Selling on Walmart Marketplace comes with a unique pricing structure that sets it apart from many other e-commerce platforms. Unlike some platforms that charge monthly fees or subscription costs, Walmart Marketplace does not require sellers to pay any monthly fees. This is a significant advantage, particularly for small businesses and entrepreneurs who want to avoid fixed overhead costs.
Instead, Walmart Marketplace employs a referral fee system, which is a percentage of your sales. The referral fee can vary based on the specific product categories and prices. It typically falls within 6% to 15% of each completed sale. This pay-per-sale structure means you only incur costs when you make a successful sale, aligning your expenses with your revenue and profitability.
How do I start selling on the Walmart Marketplace?
If you’re convinced that selling on Walmart Marketplace is wise, it’s time to explore how to get started.
Here are the essential steps to becoming a Walmart Marketplace seller:
Step 1: Gather Your Documentation
Collect your business tax ID, W9 or W8, EIN Verification Letter, and information about your product categories and SKU numbers.
Step 2: Complete the Application
Visit marketplace.walmart.com, click “Request to Sell,” and fill in the required fields. Double-check for accuracy, then click “Apply Now.”
Step 3: Complete Your Registration
Create your account, review and sign the Walmart Retailer Agreement, provide company registration info, fill out a W-9 tax form, and select a payment processor and shipping method.
Step 4: Complete Partner Profile
Access the Seller Center, complete your Partner Profile, and verify your readiness for launch.
Step 5: Complete Item Setup
Input all your content, including images, descriptions, and attributes. Validate and upload your file to the Seller Center.
Step 6: Test Items and Orders
Preview your items for content and pricing. Test orders by updating inventory to 1, then publish and purchase an item.
Step 7: Launch Your Account
Mark all items on your Walmart launch checklist as done. Confirm your readiness to launch, and the Walmart Marketplace integration team will review your profile. Your products will be live on Walmart.com within 24 hours if all is well.
Follow these steps, and you’ll be well on your way to selling on Walmart Marketplace.
Challenges to Consider When Selling on Walmart Marketplace
While selling on the Walmart Marketplace offers substantial benefits, it’s essential to be aware of potential challenges:
Competition: While the competition is less intense than on platforms like Amazon, you’ll still face competition from other sellers, and standing out requires effective marketing and product differentiation.
Strict Standards: Walmart has stringent quality and fulfillment requirements that must be met to maintain your seller status. Failing to do so can result in account suspension on Walmart.
Fees: Although Walmart’s fees are competitive, they can still affect your profit margins. Be sure to account for these costs in your pricing strategy.
Brand Control: You may have limited control over your brand’s presentation on the platform, as Walmart has specific guidelines for product listings.
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