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Can Retailers Combat Coronavirus Again With Curbside Pickup?

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The coronavirus pandemic that has resulted in an increasing number of people maintaining social distancing also led to shifting trends in the retail space. Congregating inside retail stores has almost stopped and most retailers have now taken to curbside pickups. Walmart, Inc.’s (WMT - Free Report) Sam’s Club division is the latest to jump the bandwagon with the launch of its curbside pickup and contactless payment service.

Curbside pickup is likely to see a fresh surge on new cases of coronavirus being reported in several states. This is likely to once again raise fears in the minds of millions, who are already under restrictions with the economy yet to reopen completely.

Walmart Boosts Curbside Pickup Service

Walmart’s Sam’s Club announced on Jun 11 that it will launch pickup at nearly 600 locations across the United States by the end of the month. While the new service will be free for plus-level members, the company said it would make it temporarily available for every member at no extra cost.

The retailer has been promoting curbside pickup at 16 of its locations lately and the results so far have been positive.  Besides making available the curbside service at all its locations, the company also plans to continue its concierge service for seniors and at-risk members every Tuesday and Thursday from 7 a.m. to 9 a.m. This includes the company's pharmacy and optical centers.

Walmart’s grocery business has been a significant contributor to its e-commerce sales particularly during the pandemic. This division of Walmart, which comprises membership warehouse clubs, witnessed a net sales rise of 9.6% to $15.2 billion in the first quarter of fiscal 2021. 

In fact, despite Amazon.com, Inc. (AMZN - Free Report) redefining the online retail space in the past few years, Walmart has been customers’ preferred online grocery provider. The curbside pickup facility is going to further boost its popularity. Zacks Rank #3 (Hold) Walmart’s shares have increased 6.9% in over the past one month. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Retailers to Modify Delivery Service Strategy

The COVID-19 outbreak has been keeping people at home and most are adhering to the CDC guidelines of maintaining social distancing. However, shopping for grocery and other necessities is a must. This has seen retailers and grocers change their operational strategy. Besides Walmart, a number of other retailers too have either launched or enhanced curbside pickup options to survive the pandemic.

Best Buy Co., Inc. (BBY - Free Report) , which opened nearly 800 stores on Jun 15 after more than two months of closure, has been offering curbside pickup during the pandemic. Also, Target Corporation (TGT - Free Report) has been offering curbside pickup, which substantially aided its sales in the first quarter. Around 5 million consumers shopped on Target.com for the first time in the first quarter, and 2 million of them picked up their orders at the curbside.

U.S. retail sales have taken a massive hit owing to the pandemic with stores closed for almost 10 weeks. However, curbside pickup has been helping them somewhat during this time. Five Below, Inc. (FIVE - Free Report) , which opened around 75% of its stores in May end, had been offering curbside pickup during the lockdown period. Nordstrom, Inc. (JWN - Free Report) had temporarily closed down all its stores on Mar 17 but has been offering curbside pickup. Target, Nordstrom and Five Below each carries a Zacks Rank #3. Shares of Target Corporation and Five Below have gained 15.7% and 44.3%, respectively, in the past three months. Nordstrom’s shares have surged 12.9% in the last 30 days.

Although retailers have finally started reopening their stores, fears of a second wave of coronavirus have already set in, with the rising number of new COVID-19 positive cases. Given this scenario, curbside pickup stands a solid chance of boosting both e-commerce and retail sales.

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