Walmart invests $350M in Alabama distribution center upgrade

Walmart is investing $350 million on a high-tech upgrade of its distribution center in Cullman, Alabama, part of the retail giant’s broader plan to update all 42 of its regional supply chain facilities, the retailer and city officials said this week.

Once renovations are complete, a process expected to take several years, the 40-year-old facility in Cullman will be able to ship nearly twice as many cases as a traditional regional distribution center, Walmart said.

“Adding robotics, automation and AI-powered software systems to this facility will revolutionize an already impressive operation, fundamentally changing the way we distribute products to stores,” Ken Caviness, the distribution center’s general manager, said in a statement. “This isn’t just an investment in our facility, but also in our associates, our community and our future.”

Walmart declined to say how much it is spending on the renovations, but city officials said the $350 million investment is the largest-ever single capital outlay in the city, according to local media reports.

The city of Cullman approved a $20 million tax abatement for Walmart as part of the renovation, local media reported.

“With this investment, it will create $2o million in educational taxes,” Cullman Mayor Woody Jacobs told The Cullman Tribune. “The good thing about this automation project is that it’s reaffirming Walmart’s relationship with the city of Cullman … No industry here can match the jobs created by Walmart over the past 40 years.”

Modernizing Walmart’s regional distribution centers automates the retailer’s supply chain network, transforming what was previously physically demanding work, the company said. Updated distribution centers rely on a mix of “people, robotics and massive storage systems” to boost shipment speed and efficiency, Walmart said.

“The improvements we’re making in our Cullman, Alabama, distribution center will be felt by store associates and customers in the surrounding region,” Rachel Nash, regional general manager of Walmart’s Southeast operations, said in a statement. “For our store associates, these investments will make it significantly easier and faster to stock shelves, which results in our customers having the items they want, when they want them.”

Walmart currently operates five distribution centers and 144 retail stores in Alabama.

Last year, Walmart announced it had purchased a majority stake in warehouse automation technology provider Symbotic, a company it had worked with since 2017. Symbotic's technology is able to build palletized loads of department-sorted inventory to help Walmart get products on shelves more quickly, the retailer said at the time. After initial tests, Walmart said it would install the technology at all 42 of its distribution centers around the country. 

“The need for accuracy and speed in the supply chain has never been more visible, and we’re confident that now is the time to move even faster by scaling Symbotic’s technology to our entire regional distribution center network,” David Guggina, SVP of Innovation and Automation for Walmart, said in a statement last year. “Using high-speed robotics and intelligent software to organize and optimize inventory, the Symbotic System helps us get products to our customers quickly and seamlessly by revolutionizing how we receive and distribute products to stores.”