The retailer announced on Monday it agreed to purchase Grand Junction a tech startup whose software is able manage local deliveries by using a network of almost 700 carriers.
Grand Junction's software platform is used by retailers, distributors and third-party logistics providers to manage local delivery. The software company also enables payment processing, visibility and operations dashboards.
Currently, Grand Junction is working with Target on its same-day delivery pilot at the Target store in New York's Tribeca neighborhood. "It will also boost our ability to offer new services - like same-day delivery, and even assembly and installation - to our guests", said Arthur Valdez, Target's chief supply chain and logistics officer and a former Amazon executive.
Target is transforming its supply chain and logistics capabilities so we can serve guests with more speed and convenience, while creating new offerings and services. Retail experts say they see the move as a way for Target to better compete with Amazon, as more of its customers use e-commerce to purchase products and expect speedy and low-priced delivery.
The company may also use Grand Junction to create an assembly and installation program like those now offered by Best Buy and Amazon. Its founder and chief executive, Rob Howard, is to become Target's vice president of technology.
Target announced that same-day deliveries would be expanded to include stores in NY during the fall and to other large cities in 2018. He said the planned acquisition of Grand Junction would not change Target's deal with Instacart. In June, Target announced a pilot program in the Minneapolis area to deliver essential household goods such as pet food and laundry detergent within one business day.
Grand Junction's 13 employees will become Target workers after the deal closes, Target said. Target hopes to deliver on both fronts.
Target has adopted several measures aimed at accelerating its sales growth, including a focus on digital business, small-format store openings, supply-chain reinvention, and the remodeling of large stores.