Target plans to invest $100 million in expanding its U.S. parcel-sorting network to more than 15 facilities by the end of 2026, up from nine operating centers. The retailer announced the plan on February 22, 2023, extending a delivery system that moves sorting out of store backrooms while leaving store employees to prepare online orders. [T1][T3]

The handoff starts after an order has been packed. Target says each sortation-center team collects packages from 30 to 40 local stores, then sorts them for delivery to nearby neighborhoods. A third-party carrier or a Shipt route handles the last leg, depending on the lowest-cost option. Target’s July 2022 account explains the distinction: stores still pack the orders, while the centers take over sorting. The freed backroom space is intended to let store teams fulfill more orders; the stores remain the starting point. [T1][T3]

Drivers are part of that handoff, too. In July 2022, Target described more than 2,000 Shipt drivers using personal vehicles to deliver packages from its Minneapolis operation. It was also piloting larger delivery vehicles there. By the February 2023 announcement, Target said it was testing third-party partnership delivery vans in two sortation-center markets, with plans to reach all its sortation markets over the next few years. It said the larger vehicles could hold up to eight times as many packages per route. That is a vehicle-capacity claim, not a measured increase in deliveries per hour or drivers’ take-home pay. [T1][T3]

Target reported that its sortation centers delivered 26 million packages in 2022. Its next-day figure has a narrower scope: up to 40% of Target Last Mile Delivery orders with Shipt arrived the next day. Target does not say what share of those 26 million packages used that service. The 40% figure is not a rate for all Target online orders or a next-day promise for every address. The company expected more orders to arrive next day as the network expanded. [T1]

The nine centers were in Minnesota, Texas, Colorado, Illinois, Georgia and Pennsylvania. Target anticipated hundreds of new jobs as it added facilities, but did not give a net company-wide employment forecast or quantify how store staffing would change. Its stated use for the time and space released in stores was more order fulfillment and customer service. The announcements give no staffing plan for individual stores. [T1][T3]

Source documents

  1. We’re Expanding Next-Day Delivery Capabilities, Bringing Speedier Delivery to Even More Guestshttps://corporate.target.com/news-features/article/2023/02/sortation-centers
  2. We’re Adding Three New Sortation Centers in Denver and Chicago to Deliver Even Faster for Guestshttps://corporate.target.com/news-features/article/2022/07/sortation-centers