Dive Brief:
- Walmart plans to begin another phase of a distribution center remodel in New Braunfels, Texas, this summer, according to a Texas Department of Licensing and Regulation document dated May 28.
- The latest step in the 96,715-square-foot remodel includes selective demolition, installation of new electrical and material-handling equipment, and updates to fire suppression and compressed air systems, the document says.
- The upcoming phase is expected to cost $8 million and begin on Aug. 17, with a completion date of Sept. 17, 2027, per the state form.
Dive Insight:
The ongoing remodel illustrates Walmart’s broader strategy to automate its distribution network and rein in costs. The retailer has made automation a priority in recent years to better manage its largest expenses: inventory and labor.
Overall capital investments in Walmart's supply chain could peak this year and next, with automation accounting for a significant share of the spending, executives said earlier this year. In the U.S., Walmart is retrofitting 23 of its 42 regional distribution centers with automation and plans to upgrade all locations eventually.
Late last year, Walmart cited automation as a factor in reducing shipping costs by improving operational efficiency. More than 60% of the company's U.S. stores receive at least some freight from automated distribution centers.
Walmart declined to provide additional details on the Texas project.
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