Asda exec knows the way to San Jose for online trial

The world’s biggest retailer has begun testing the delivery service in San Jose, and Richard Ramsden, the head of Asda’s home-shopping business, has been drafted in to work at Walmart’s online headquarters.

Mr Ramsden, an applied stastistics graduate from Sheffield Hallam University, worked for Great Universal Stores and Tesco before joining Leeds-based Asda.

Walmart had been rumoured to be considering dipping its toe into online grocery delivery for the past few years.

It is facing competition from online rivals and wants to find new avenues of growth.

The “Walmart To Go” test allows customers to visit Walmart.com to order groceries and consumables found in a Walmart store, and have them delivered to their homes, according to a spokesman for the company.

Products include fresh produce, meat and seafood, frozen, bakery, baby, over-the-counter pharmacy, household supplies and health and beauty items at an average fee of $5-$10.

No other details were immediately available.

The online grocery business has proved difficult because of the perishability of fresh food and the industry’s small profit margins, analysts have said.

Deborah Weinsburg, analyst at Citigroup, said that Walmart is “currently under-penetrated online, with e-commerce representing less than one per cent of total sales, by our estimates”.

If WalMart decides to stay and expand in the online grocery delivery business, its competition would include Peapod and Amazon Fresh.

Online food shopping is more advanced in the UK, with all of the main supermarket groups (bar Bradford-based Morrisons, which plans a move into the market next year) offering a service.

Walmart’s US grocery business generated about $140.6bn in sales last year, up 2.1 per cent from the previous year, according to a recent media report.

Groceries accounted for 54 per cent of the company’s total US revenue in the year ended January 31, the company’s fiscal 2011.

Last week, Walmart bought social media company Kosmix for an undisclosed sum, as part of its bid to win over more tech-savvy US shoppers.

Walmart said Kosmix’s founders and team will operate as part of a newly formed group called @WalmartLabs, that will create technologies and businesses around shopping online or with smart phones.

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