Yesterday, Walmart announced new multichannel logistics and cross-border fulfillment services for sellers as part of its “Let’s Grow! 2024 Walmart Marketplace Seller Summit.”

Yes, Walmart, the mega-retailer, is moving further and further into the third-party logistics (3PL) space, just as Amazon has been doing for years.

Here are some details from the press release:

Walmart continues to leverage its next-generation supply chain and advanced technology to simplify and streamline order fulfillment for sellers—all at the lowest prices in the industry. Walmart Fulfillment Services (WFS) announces new ways for sellers to quickly move goods between markets and use Walmart to fulfill all e-commerce retail orders.

Multichannel logistics: Walmart’s new Multichannel Solutions program allows sellers to use WFS to fulfill orders from any e-commerce site through Walmart’s supply chain. Walmart will fulfill orders and manage returns while offering simple, unbranded packaging, fast, reliable shipping and competitive pricing that is, on average, 15% lower than competitors. Walmart will launch the program on September 10, in time for holiday deliveries.

Cross-border order processing: With its new Walmart Cross Border full container load import service, WFS can now handle the transportation of inbound goods from ports of origin in Asia directly to WFS facilities across the United States.

Walmart is also opening its carrier network to sellers who ship full truckloads. Sellers using the Walmart Preferred Carrier program through WFS can now choose to ship a few items or a full truckload at special rates using Walmart-approved carriers.

This continues a trend I wrote about nearly two years ago in “Retailers Offering 3PL Services: What’s Going On?” I recommend you read the post for the full answer, but here’s the short version:

First, more and more large retailers (and manufacturers) are beginning to view logistics as a core strategic function and are therefore investing in assets, personnel and technology to gain more direct control over their operations.

Second, having made these investments to benefit their own operations, retailers and manufacturers are now seeking to leverage these assets, employees and technologies to “diversify their revenue streams and profit pools” by offering logistics services to other businesses, particularly small and medium-sized enterprises that cannot afford these investments themselves (and/or still do not consider logistics to be their core competency).

There is another important factor at play here: For too long, traditional logistics service providers have ignored small and medium-sized enterprises (SMEs), i.e. many sellers on these marketplace platforms. As I wrote in December 2014:

For a variety of reasons (high distribution costs being one of them), most 3PLs and software vendors have historically underserved the SMB market, focusing their sales efforts on large enterprises instead. But as the high-end of the market becomes increasingly saturated and competitive—and new competitors emerge with hybrid business models that offer customers more flexible, faster-to-implement, and more cost-effective solutions—the race for market share in the SMB market is on, and at a profit.

The race was on, but most 3PLs didn’t realize it, so Amazon, Walmart and other “non-traditional” logistics providers filled the gap.

The opportunities for SMEs actually start in the startup phase. In May 2013, I interviewed angel investor Tom Friedman about the connection between entrepreneurship, angel investing, and supply chain and logistics. Tom’s experience working with startups, particularly those that produce physical products, shows that many entrepreneurs are very good at engineering and product development, but they lack the skills and expertise in a critical area to scale their businesses: logistics and supply chain management.

As I wrote at the time, “Another thing that needs to change is the way third-party logistics providers (3PLs) look at startups and entrepreneurs. Simply put, 3PLs need to think more forward-looking – they need to think more like investors and not just focus on the short-term risks and revenue opportunities.”

I also commented on this topic in a 2012 post titled “Entrepreneurs, 3PLs and Angel Investors: Powering the Make Economy”:

Before meeting with an angel investor, entrepreneurs should first meet with a forward-thinking 3PL. If you can get the 3PL to invest its time, resources and assets effectively in your business (for example, through a vested outsourcing arrangement that balances the risks the 3PL takes up front with the benefits down the road), you’ll have a partner on your side who can handle all of an angel investor’s supply chain and logistics issues.

And that’s my suggestion for 3PLs: Be proactive when an entrepreneur knocks on your door. If an opportunity looks promising, find a creative way to partner with the entrepreneur that minimizes upfront costs and risks for him or her while maximizing your long-term profit potential.

(For another post on this topic, see “Choosing the Right 3PL and IT Partners: An Entrepreneur’s Perspective.”)

Back to the Walmart announcement, a lot of the initial comments I read are about how this would level the playing field with Amazon or maybe even raise the stakes for them. But to me, the more interesting questions are: What is a 3PL today? What industry are they in?

As I have said many times, the answers to these questions are very different today than they were ten years ago, and they are constantly changing.