Walmart ups the delivery game with next day U.S. shipping

A sign is seen outside a Wal-mart store in Duarte, Calif. on May 28, 2013. (AP Photo/Damian Dovarganes)

NEW YORK - Walmart is rolling out free next-day delivery on its most popular items, increasing the stakes in the retail shipping wars with Amazon.

The retail giant says it's been building a network of more efficient e-commerce distribution centres to make that happen.

The next-day service will cover 220,000 popular items from diapers and non-perishable food items to toys and electronics.

That's nearly double the number of items it carries in its stores.

Next-day delivery, which will require a minimum order of $35, will be available in Phoenix, Arizona, and Las Vegas on Tuesday.

In coming days, it will expand to southern California.

The discounter plans to roll out the service to 75% of the U-S population by year-end.

It will also be adding hundreds of thousands more products as the program expands.

The announcement comes just two weeks after online behemoth Amazon said it's upgrading its free shipping option to Prime members who pay $119 a year to one-day delivery from two-day delivery.

Amazon has declined to say when the switch will happen, but it already offers one-day delivery for some items in certain areas.

Walmart says the new delivery program has been in the works for a while.

Marc Lore, C-E-O of Walmart's U-S e-commerce division, says customer expectations continue to rise and Walmart is trying to get ahead of that.

The move will only increase pressure on other rivals that are already investing in millions of dollars to shorten the delivery window.

Amazon changed consumer expectations when it launched its two-day delivery for Prime members back in 2005 and forced other retailers to step up their game.

But analysts say Amazon then needed to cut the delivery time in half to make its membership more attractive since others like Walmart offered free two-day deliveries without any membership.