Target has agreed to acquire Shipt, Inc., an online same-day delivery platform, for $550 million in cash.
Officials with Target said the retailer will leverage its network of stores and Shipt’s proprietary technology platform and community of shoppers to bring same-day delivery to its customers across the country. Target plans on bringing same-day delivery services to about half its stores by early 2018, company officials said, with long-term plans to be in a majority of stores and all major markets by the 2018 holiday season.
At launch, Target will offer same-day delivery of groceries, essentials, home, electronics and other products, while expanding the products offered over time. By the end of 2019, same-day delivery will include all major product categories at Target.
“With Shipt’s network of local shoppers and their current market penetration, we will move from days to hours, dramatically accelerating our ability to bring affordable same-day delivery to guests across the country,” said John Mulligan, evp/chief operating officer for Target.
Founded in 2014 and located in Birmingham, AL, Shipt is a rapidly growing membership-based grocery marketplace and same-day delivery platform. The service leverages an extensive network of more than 20,000 personal shoppers to fulfill orders from various retailers and deliver within hours in more than 72 markets, according to the company.
Shipt will be a wholly owned Target subsidiary and will continue to run its business independently. It also plans to expand partnerships with other retailers seeking same-day, last-mile capabilities. Chief executive officer Bill Smith will remain in his current role, and will report to Target chief operating officer, John Mulligan.
The transaction is subject to customary closing conditions and is expected to close prior to the end of calendar year 2017.