Walmart rivals Amazon Fulfillment by allowing vendors to use similar service

Walmart launches rival third-party vendor fulfillment service rivaling Amazon

Walmart has bridged the gap between its third-party vendors on the marketplace allowing the company to compete better in e-commerce.

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In a video, Monday, the world's third-largest retailer, announced that the company will begin it's Walmart Fulfillment Service allowing its sellers on marketplace an area to store and ship products in a two-day period.

"WFS was built with sellers for sellers to help them grow sellers and reach more customers," Walmart's VP of e-commerce Jare' Buckley Cox said in the video.

Third-party vendors will sign up for WFS through a separate site. A program overview site is also available to explain how the system works.

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Walmart has tested the site for months before officially inviting its vendors to WFS on Tuesday. Its e-commerce boss Marc Lore said in September that it was testing WFS but declined to issue any more information on the progression of the program according to a Bloomberg report.

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Over the last several years, Walmart has worked to catch up to rival Amazon, whose fulfillment service has an estimated 3 million vendors. Even though Walmart launched its marketplace in 2009, it is looking to be more competitive in this space and lure more third-party sellers away from Amazon and onto its platform.

There is a slight difference between Amazon's service and Walmart's. Existing and prospective sellers are eligible to sign up. After approval, vendors can send their inventory to a Walmart Fulfillment Center for an additional fee. Walmart handles picking up, storing, shipping and the return of all products. No perishable or regulated products will be accepted, and they have to be shipped from within the United States.

Other key players in the fulfillment service are FedEx and Shopify, but it isn't entirely clear how well those operations are doing. EBay dipped its toe into the space but shut down operation after a year.

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Walmart is closing the service-offering gap with the e-commerce giant Amazon, but as for now the two are very much so competing on two separate fields. Morgan Stanely estimates Amazon shipped more than 5 billion packages last year, 16 times more that Walmart.com.  Amazon accounts for 38 percent of U.S. e-commerce sales with Walmart distantly trailing behind with 5.3 percent.

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