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Walmart Teams Up With FedEx in Joint Challenge To Amazon

In a new move to generate shopper visits to its stores, Walmart (WMT) will be home to FedEx (FDX) Office shipping locations at 500 of its stores, the companies announced at the Shoptalk conference in Las Vegas on Tuesday.

Walmart, eager to continue its streak of 14 quarters of comparable sales growth in the U.S., has made spurring shopper traffic a top priority by offering services like drive-by pickup for groceries and introducing express lanes for pharmacy prescription pickup. Using its 4,500 stores has been key to Walmart’s efforts to keep Amazon at bay.

Its partnership with FedEx, which builds on a test at 47 stores, is in that same vain.

“Our busy customers view our stores as a one-stop-shop for all the products and services they are looking for,” said Daniel Eckert, senior vice president, Walmart Services and Digital Acceleration, in a statement.

People receiving packages will also be able to have them sent to a FedEx Office within a Walmart, where they’ll be held for five business days.

For FedEx Office (the shipping giant’s retail business), which like Walmart is competing with an increasingly aggressive Amazon.com (AMZN), the partnership adds to its own 1,900 locations and dramatically extends its reach. There have been news reports that the online retailer was planning to test its own delivery service for part of the delivery process, specifically third-party sellers to its distribution facilities, to cut service times. FedEx, UPS, and the postal service would continue to handle shipping to homes.

Still, Amazon’s move could eventually lead it to handle more of a package’s journey—a major threat to FedEx.

FedEx Office CEO Brian Philips said in a statement, “The growth of our store network to 500 new locations brings our brand even closer to busy consumers who have told us they are seeking secure, reliable options for packing, shipping, and receiving packages.”