Walmart Inc. WMT is not leaving any scope to expand its online business, given its growing popularity amid the pandemic-led social distancing. The omnichannel retailer, in collaboration with Marcus by Goldman Sachs GS, is stepping into business lending, which will help it strengthen its Walmart Marketplace business. Incidentally, Walmart stated that eligible sellers at its Marketplace will get invited to apply for credit lines from Marcus by Goldman Sachs.
Credit availability is likely to help small and medium-size businesses cater better to the rising customer demand and respond to their changing preferences and shopping patterns. In the beginning, approved Marketplace sellers can access credit lines in the range of $10,000-$75,000 from Marcus, while the maximum credit line amount is expected to increase in the future.
Walmart’s effort to support small and medium businesses amid the ongoing crisis is likely to yield results. Notably, these businesses are quite important for the communities the company serves and hence, helping them by offering a credit line appears to be a good move. In fact, Walmart’s Marketplace on the whole is a significant part of its e-commerce business and it has been undertaking robust efforts to enhance the same.
In a recent move, Walmart teamed up with Shopify Inc. SHOP, an all in one commerce platform – to open its Walmart Marketplace to sellers of the latter. Certainly, the company’s efforts to strengthen its e-commerce business are paying off all the more amid the current pandemic-led situation, wherein customers are choosing to stay indoors and shop online. In the second quarter of fiscal 2021, Marketplace sales jumped at a triple-digit rate and helped Walmart U.S. segment’s e-commerce sales to surge a whopping 97% with strength across all channels. Weekly average digital customer count as well as repeat rates grew significantly and boosted e-commerce sales.
Walmart Continues to Play E-Commerce Game Well
Walmart is well known for its efforts to step up its online game, which is helping this supermarket giant to battle the growing competition from Amazon AMZN. Incidentally, Walmart has been strengthening its online assortment by launching exclusive and premium brands. The company has introduced more than 1,000 apparel brands to its online collection. Toward this end, its alliance with thredUP (a re-commerce business) again aims at serving customers per their evolving needs.
Apart from this, the company’s contract with Green Dot; buyouts of ShoeBuy, Moosejaw and Bonobos, among others, underscore its intention to build an impressive digital brand portfolio. Further, the buyout of a major stake in Flipkart has been bolstering its e-commerce sales. Apart from this, Walmart is making aggressive efforts to expand in the booming online grocery space, which has long been a major contributor to e-commerce sales.
Walmart’s concerted efforts to bolster its e-commerce business have been a treat for investors. Markedly, the Zacks Rank #2 (Buy) stock has rallied 13.2% in the past three months compared with the industry’s growth of 11.1%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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