Target is piloting a new sortation center in its home base of Minnesota to test a first-of-its-kind facility that aims to speed up the online delivery process.
The facility, which was opened last year and powered by equipment Target acquired from Grand Junction and Deliv, is now testing a new capability with online delivery service Shipt. The facility will help relieve some of the fulfillment burdens placed on stores, changing up the store-to-hub fulfillment model currently in place.
The pilot comes as Target has experienced huge growth in its online and delivery services since the Covid-19 pandemic, like many other retailers. The big box retailer has stood out among its peers when it comes to customers using its app, however. Last year, the company expanded its grocery order pickup and delivery services after experiencing more than 200% digital growth in the second quarter.
The model still works with customers placing an order online that is fulfilled in back rooms by local store employees. Those packages are then picked up to head to the sortation center nearby. The sortation center currently services the Minneapolis/St. Paul-area Target stores, but will serve all metro stores by the end of April, Target announced.
Once at the sortation center, Target leverages its technologies to determine the best delivery method, including the most efficient way to sort and route for delivery. Target bunches orders by neighborhoods and is currently testing how Shipt delivery drivers can deliver orders in batches organized by neighborhood.
“For years, Target has put our stores at the center of how we serve our guests. Our new sortation center builds on that model by helping us ship online orders with greater speed and lower costs, while making room for future growth,” John Mulligan, Target’s chief operating officer, said in a statement. “By adding Shipt to that operation, we’re now testing how we can reach guests even faster with efficient local deliveries.”