"Target's model is local at heart. Leveraging the chain's network of physical stores, Shipt has effectively brought fulfillment closer to the customer. Drivers pick up orders in local Target stores, effectively replacing long-haul shipping with shorter routes."
"Target can reportedly reduce delivery costs by roughly $2.50 per package using Shipt instead of national carriers. The savings come from fewer handoffs and shorter routes, as packages no longer move through multiple sortation centers or long-distance carrier networks."
"Speed improves as a result. Orders originate closer to the customer, and delivery windows tighten without requiring premium air or expedited services. The model lowers fulfillment cost while meeting rising consumer expectations for faster delivery."
Local carriers promise quick and inexpensive ecommerce delivery, yet issues of consistency and doorstep theft remain. Merchants are addressing last-mile delivery challenges, with Target expanding its Shipt-powered same-day delivery to over 100 stores by 2026. Utilizing gig-economy workers, these services enhance delivery speed and reduce costs by leveraging local store inventories. Target's acquisition of Shipt in 2017 has allowed for a more efficient last-mile network, cutting delivery costs and improving speed by minimizing handoffs and shortening routes. Other retailers like Walmart and Amazon are adopting similar strategies.
Read at Practical Ecommerce
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