In the race to win at e-commerce, one frontier that even the biggest retailers needed to conquer was merchandise assortment. A vast product offering is one of the reasons people go to Amazon. No matter what you want, you can probably find it on Amazon. There’s also the engagement that comes as people browse, research and evaluate products, something that is enhanced by a massive product offering. Amazon has an army of about 1.7 million third-party sellers that fill its website with millions of products. It has the advantage of inventory without the costs of product development. No investment in owning inventory. No shipping costs. The seller assumes all costs. Amazon simply takes a percentage of any merchandise sold on its platform. Third party sellers generated $160 billion in sales in 2018, roughly 58% of its total sales. For Walmart, and other retailers who want to win big online, third-party sellers will be critical component. <h3><strong>Leveraging Logistics for More Than Package Delivery</strong></h3> While sellers can handle their own shipping, Amazon set up a service that can do it for sellers - for a fee, of course. A key to the success of third party sellers on Amazon is the company’s comprehensive selling tools referred to as Fulfilled by Amazon (FBA). This includes inventory management, payment processing, reporting and shipping, according to Amazon’s 2018 Annual Report. <blockquote> Over 66 percent of Amazon’s top 10,000 sellers use FBA.</blockquote> With Fulfilled by Amazon (FBA) a seller can ship their its inventory to an Amazon warehouse. When a sale is made, Amazon pulls the merchandise from the warehouse and ships to the customer. The seller benefits from being able to use Amazon’s state-of-the-art logistics platform, as well as much cheaper rates from couriers, thanks to Amazon’s market clout. Over 66 percent of Amazon’s top 10,000 sellers use FBA. Walmart has opened up its online store to third party sellers as well and is now following Amazon in offering seller services. Walmart has stepped back into the e-commerce arena now armed with its own fulfilment service. Not surprisingly, its called Walmart Fulfillment Service (WFS). The fee-based service is available to select sellers. Just like Amazon’s FBA, WFS offers warehousing, handling and shipping. WFS includes two-day shipping, easy returns, dedicated customer service, and a low-cost, simple fee structure. “WFS” will be noted on the product descriptions on Walmart’s website, indicating that Walmart expects this new service to raise the appeal of products designated with WFS. Unlike Amazon, WFS does not charge a membership fee to sellers. However, beyond seller support, Walmart has surely noticed that Amazon’s fulfilment service has turned into a very profitable, growth business. Third party seller services not only drive sales, they generate revenue for Amazon. The company saw net revenue of $12 billion attributed to Third-party Seller Services in Q2 2019, up 23% from $9.7 billion in the same quarter a year earlier. Walmart’s WFS could also become a profit centre for the retailer.