Walmart Canada says it will spend $3.5 billion over the next five years to modernize some of its stores and build new distribution centres.

The company announced the news on July 20. It says the investment is aimed at creating faster e-commerce experiences for customers and creating smarter stores. It also says the investment will create hundreds of Canadian construction jobs and forge new partnerships with Canadian technology companies.

"Millions of customers choose to shop with us in-store and online every day – and that's a tremendous honour," said Horacio Barbeito, the president and CEO, Walmart Canada. "Today's significant investment will position us for future growth and make Walmart Canada even better for our associates and our customers. We are doubling down on our focus on the customer experience—not just to keep up but to lead and to be the very best in Canada."

Of the money, $1.1 billion will be spent to build two new distribution centres, and to renovate a third. The company will build a next-generation 550,000-square foot distribution centre at 11110 Jane Street in Vaughan. That building is slated to open in 2024. A second facility, in Cornwall, will feature new automated systems that will feature machine learning Cobot Technology that works in concert with humans to improve the accuracy and efficiency of operations.

Walmart also has a 300,000-square foot distribution centre under construction in Surrey, BC that is slated to open in 2022.

Changes to its distribution centre systems include adding telematics and Internet of Things sensors across over 2,200 trailers to give real-time information about deliveries, adopting artificial intelligence software to better predict and better plan volume to meet forecasted customer demand, and introducing machine-learning training software to improve safety.

Also listed in the announcement are plans to renovate more than 150 stores, or a third of the company’s Canadian store network. This, says Walmart Canada, is in addition to the $1 billion the company has spent over the past five years to remodel and open stores.

The new funding will be aimed at introducing further digitization in stores. Initiatives include introducing technology such as electronic shelf labels, shelf scanners that monitor product volumes, and robotics and computer vision cameras to maximize efficiency and accuracy. The company will also pilot hybrid locations, which are large stores with micro fulfilment centres in their backrooms to increase the speed of fulfilment for pickup and delivery.

"The retail business is as dynamic as ever and this investment ensures we're developing a supply chain that is the envy of the world," said John Bayliss, senior vice president, logistics and supply chain, Walmart Canada. “The better the supply chain, the quicker our customers can get the products they want. This investment will transform our supply chain and create hundreds of Canadian construction jobs along the way.”