Target Corp. is expanding its next-day delivery service to 20 additional metropolitan areas, bringing the total number of cities where consumers can quickly receive online orders to over 50. This move is part of the company's efforts to modify stores into mini-fulfillment centers and invest $2 billion in incremental investments during 2026 for stores and operations.
The expanded footprint will bring next-day delivery to 60% of the U.S. population, with faster delivery service coming to cities like Birmingham, Alabama; Santa Barbara, California; Fort Myers, Florida; and Honolulu. Currently, Target delivers next day in about 35 large markets.
Target's same-day services generated over $14 billion in sales last year, accounting for two-thirds of its total digital sales. The company is investing to make those services even faster and more efficient, with a focus on cost competitiveness and efficiency.
The company's logistics model involves stores serving as fulfillment hubs, which increases efficiency and lowers costs. Packages are retrieved from local stores, sorted, batched, and routed for delivery by Shipt or third-party carriers. This approach reduces processing time for delivery partners.
Removing the sorting and packing process from certain store backrooms saves valuable time and space for store teams to fulfill additional orders and serve customers. The technology also presorts and arranges packages for easy pickup, reducing processing time for delivery partners.
Target's CEO Michael Fiddelke emphasizes the importance of simplifying the workflow for store staff, which improves the customer experience. He notes that not every store needs to ship boxes, and that the focus should be on in-store business rather than shipping.
The expansion of next-day delivery is a significant step forward for Target, which continues to invest in its digital fulfillment capabilities. With over 85% of goods sold in physical stores eligible for next-day delivery, the company is well-positioned to meet growing customer demand for fast and convenient shipping options.
Target's decision to make next-day delivery free for orders over $35 or with no minimum order amount for Target Circle 360 members and credit card users will likely appeal to price-sensitive customers. The company's focus on cost competitiveness and efficiency will also help it stay competitive in the rapidly evolving retail landscape.
As the retail industry continues to shift towards online shopping, companies like Target are investing heavily in their logistics capabilities to meet growing demand for fast and convenient shipping options.
The expansion of next-day delivery by Target highlights the growing importance of fast and efficient logistics in the retail industry.
