Published: Wed, August 16, 2017
Economy | By Melissa Porter

Target Buys Same-Day Delivery Company to Battle Amazon

Target Buys Same-Day Delivery Company to Battle Amazon

The San Francisco-based company offers a software platform used by retailers, distributors and third-party logistics providers to manage local transportation through a network of more than 700 carriers.

The tech company is already working with Target on a same-day delivery pilot at the Target store in the Tribeca neighborhood of New York City. Details of the deal, which is expected to close soon, were not disclosed.

Target plans to expand the service to other NY locations this year, and then bring it to other major cities next year.

Arthur Valdez, Target executive VP, chief supply chain & logistics officer, and Rob Howard, CEO, Grand Junction.

"Whether guests shop online or in a store, they expect to get products quickly and on their terms", said Valdez, who was hired away from Amazon in May.

The retailer said the acquisition will improve and expand its delivery capabilities, and accelerate its investments and ongoing efforts to transform its supply chain.

"It will. boost our ability to offer new services - like same-day delivery, and even assembly and installation - to our guests", Valdez said in a statement.

Valdez told the Minneapolis Star Ledger that a new Target distribution center in Perth Amboy, NJ will help it service the NY area using a faster, real-time replenishment model. Howard says that the merger offers a tremendous opportunity for Target to leverage local delivery during a time of great push and competition for same-day delivery options.

Target recently launched next-day delivery of household items, called Target Restock, in its home market of Minneapolis.

The 13 employees at Grand Junction will become employees at Target following the closing of the deal, said a Target official. "By acquiring scalable technology, Target balances their competitive profile".

"Grocery shopping online is a relatively small part of the business but it is continuing to grow", Aldi's Vice President of Corporate Buying, Scott Patton, told Reuters. "As retailers continue to sort themselves into competitive clusters, the playbook for such integrations is becoming better known".

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