Target wants to deliver packages faster with $100m investment

Bloomberg

Target Corp will invest $100 million to add six new package-sorting centres in a push to expand its next-day delivery capabilities.
The new hubs will be operating by the end of 2026, Target said in a statement. Target already has nine sorting centres, which are located in Colorado, Georgia, Illinois, Minnesota, Pennsylvania and Texas. The company is still selecting sites for the new ones.
The sorting centres are designed to further Target’s strategy of using its stores to handle online orders as it vies with Amazon.com and Walmart for sales. Each hub typically retrieves packages from 30 to 40 local stores, then gets them ready for delivery to local neighborhoods. Target has said that process is typically cheaper than shipping them from big distribution centres.
“I bring it back to our stores-as-hubs strategy,” Gretchen McCarthy, Target’s chief global supply chain and logistics officer, said. “The sortation centers are pulling that work out of the back rooms of the stores.”
The existing hubs are expected to double their delivery volume to more than 50 million packages this year, with a growing number of items being delivered to shoppers the day after they place an order.