Target’s New Last-Mile Center Reaches 500,000 More Customers
Target is making good on its promise to bring next-day delivery to more of its customers.
The big-box retailer this week announced the opening of a new Georgia supply chain facility dubbed the Target Last Mile Delivery (TLMD) extension, which will broaden the reach of the local sortation center to shoppers outside of its standard delivery radius.
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The TLMD extension receives pre-sorted parcels from the nearby sortation center, where workers stage them for pickup from the company’s in-house logistics arm, Shipt. Located near the Target store in Smyrna, Ga., the recently opened facility operates at a fraction of the cost of a full-size sortation center and has already expanded the company’s serviceable customer base by 30 percent. “This puts our next-day delivery within reach of 500,000 additional guests, for a total of more than 3 million in the Atlanta market,” Target said in a statement.
Shipt drivers are now delivering up to 1,500 packages daily via the TLMD extension, with plans to ramp up volume in the coming months. The facility bolsters Targets “stores-as-hubs” strategy, where retail locations double as fulfillment facilities. E-commerce orders are packaged and sent to local sortation centers for next-day delivery with Shipt. Acquired by Target for $550 million in 2017, Shipt has become a central part of the retailer’s online order fulfillment strategy.
According to the operations director for Target’s Atlanta sortation center and the TLMD extension, DaVion Ezell, the workforce has been sharing ideas on how to improve processes as operations ramp up. “We’re actively problem-solving to ensure that we are set up for success as we get closer to the holiday season to be able to achieve and exceed that demand,” he said.
“TLMD extensions represent the latest milestone in our journey to deliver a best-in-class experience for our guests—however they choose to shop with us,” Target executive vice president and chief operations officer John Mulligan said. “These facilities are a continuation of our innovative efforts to serve millions of guests and reach millions more, while maximizing speed, efficiency and care across our real estate portfolio.”
The news comes months after Target set ambitious goals to expand its last-mile logistics network, aiming to grow its footprint from nine sortation centers in 2022 to more than 15 by 2026. In February, the mass retailer said it had spent $100 million on the project, which included shifting from smaller last-mile delivery vehicles to larger ones with greater capacity for packages. It’s already seeing results; during Q1, about 65 percent of Shipt deliveries were serviced by larger vehicles, compared to zero just one year ago.
Target reported having delivered 26 million packages using its new sortation centers, with plans to double the number this year. In February, Mulligan said Target is already seeing significant cost savings.
“Our guests have come to rely on the convenience and ease of our same-day and next-day delivery capabilities thanks to our stores-as-hubs model,” Target executive vice president and global supply chain and logistics officer Gretchen McCarthy said. “Now with the power of our team and drivers with Shipt, our latest Target Last Mile Delivery investments allow us to expand our next-day delivery offerings to thousands more guests in the greater Atlanta area and bring even more joy to the guest experience.”
