Target acquires Shipt, will roll out $99/year, same-day delivery
The battle between Amazon and Walmart is widely known, but Target is now entering the space in a new way. Target announced its plans to buy Shipt, a grocery delivery startup, in a $550 million all-cash deal. Created in 2014, Shipt lets members order groceries online from various supermarkets and then sends a shopper to pick up and delivery the items on the same day.
Shipt is based in Birmingham, Alabama, and already has partnerships with some of the big grocery chains across the country, including Costco, Kroger, Publix, and HEB. Under the deal, Shipt will be a wholly owned Target subsidiary and will continue to operate independently while serving Target's new same-day delivery efforts.
Target already offers same-day delivery in New York City, but online retail seemingly becomes more competitive each day. Target's acquisition follows Walmart's recent purchase of Parcel, a New York City-based delivery company that Walmart plans to use to offer same-day delivery in the New York metro area. Meanwhile, Amazon offers same-day delivery in thousands of markets cross the country, and its $99-per-year Prime membership offers free two-day shipping to most areas.
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