Target will invest $100 million to add six new package-sorting centers in a push to expand its next-day delivery capabilities.
The new hubs will be operating by the end of 2026, Target said in a statement on February 22nd. Target already has nine sorting centers, which are located in Colorado, Georgia, Illinois, Minnesota, Pennsylvania and Texas. The company is still selecting sites for the new ones.
The sorting centers are designed to further Target’s strategy of using its stores to handle online orders as it vies with Amazon.com Inc. and Walmart Inc. for sales. Each hub typically retrieves packages from 30 to 40 local stores, then gets them ready for delivery to local neighborhoods. Target has said that process is typically cheaper than shipping them from big distribution centers.
“I bring it back to our stores-as-hubs strategy,” Gretchen McCarthy, Target’s chief global supply chain and logistics officer, said in an interview. “The sortation centers are pulling that work out of the back rooms of the stores.”
The existing hubs are expected to double their delivery volume to more than 50 million packages this year, with a growing number of items being delivered to shoppers the day after they place an order.
