Target to acquire same-day delivery platform Shipt

Jon Howard
December 14, 2017

The acquisition aims to expand Target's digital capabilities by bringing same-day delivery to customers at around half of all stores by early 2018.

Target Corp announced that it has agreed to acquire Shipt, Inc. Target's plan is to have a same-day delivery offering in nearly all stores and all major cities across the United States by the 2018 holiday season. By the end of 2019, Target plans to offer same-day delivery on all the major product categories at Target.

"Same-day delivery is a service that our guests are asking for more and more often", John Mulligan, Target's chief operating officer, said on the company's website.

Bill: We're a membership-based grocery marketplace and same-day delivery platform that allows customers to place online orders for fresh food and household essential deliveries, such as paper towels or cleaning supplies, from nearby stores. The service leverages a network of over 20,000 personal shoppers to fulfill orders from various retailers and deliver within hours in more than 72 markets. "Target has no choice but to pick up the pace", Fortune said.

Consumers' increasing preference for shopping online, along with Amazon's purchase of upscale grocer Whole Foods and its encroachment into new arenas like apparel, have sent retailers scrambling to improve their online offerings.

Target and other traditional store-based retailers have traditionally had one advantage over online retailers in that they can immediately meet a shopper's needs. Rival Wal-Mart ( WMT ), which reached a deal in October to buy same-day-delivery startup Parcel, added 1%.

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"It's win-win for us", said Bill Smith, founder and CEO, Shipt. Shipt values a personalized, customer-first delivery experience that simplifies life and saves time for members.

The deal is Target's latest move to beef up its logistics operations, following the acquisition earlier this year of software company Grand Junction, which manages local and same-day deliveries. "We'll continue growing our marketplace and membership base, working with a variety of retailers to drive scale and efficiencies".

Meanwhile, on the same day that Target announced its acquisition of Shipt, Amazon had an announcement of its own.

The transaction is expected to close by the end of this year.

Smith will stay in his role, reporting to Mulligan, and its 270 employees will remain in Shipt's offices in San Francisco and Birmingham, Alabama.

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