Target Steps Back from the Curb

Target is discontinuing the drive-up pickup service it offered for online orders in select cities even as other retailers expand the practice.Administered through a partnership with Curbside, the pilot program will be shut down effective June 15. It was first introduced in October 2014 in the San Francisco Bay Area and had expanded to New York, New Jersey, Chicago, Philadelphia and Los Angeles before being terminated.Target said in an email to the Consumerist that while the company “learned a lot” from the test, “at this time Target is focused on making sure we deliver and execute on retailer fundamentals.”The retailer will instead devote resources to its own online fulfillment options, such as shipping from stores and in-store pickup. Target is testing improvements such as adding dedicated pick-up counters, adding dedicated employees to prepare online orders, as well as using a robot built by Simbe Robotics to help with inventory tracking and order fulfillment.During the company's first quarter conference call, chief operating officer John Mulligan additionally outlined various initiatives aimed at improving in-stocks:A "data driven approach" to reducing SKUs and making room for additional facings of the "best-selling, faster turning items"Collaborating with vendors to shrink case stack sizes in order to reduce back-room inventory while increasing store labor efficiency by decreasing the number of times an item is touched before it is displayedWorking with vendors to reduce shipping windows across all categories by this fallThe conversion of three traditional distribution centers into "delayed allocation centers" for slower-turning items with more variable demand to both free up remaining centers to process faster-turning SKUs more efficiently and to more easily vary seasonal inventory across the country as demand patterns emergeEnabling three regional distribution facilities to ship directly to customersAs Target turns away from Curbside, the service provider is expanding partnerships with retailers including CVS/pharmacy and BJ’s Wholesale Club. Meanwhile, channel rival Walmart is partnering with ride-hailing services Uber and Lyft to test online grocery deliveries in Denver and Phoenix for $7 to $10 a pop, and Walmart's sister-chain Sam's Club is quietly piloting same-day delivery for business members in Miami with Deliv. The startup is also working with retailers such as Best Buy, Walgreens and Staples. Walmart's own long running grocery-delivery pilot has stalled in only two markets: Denver and San Jose, CA. However, the retailer is expanding its own curbside grocery pickup program and ShippingPass service. The mass merchant also is testing drone technology to improve processes in its distribution centers."Click and collect will be table stakes for retailers," said Steve Frenda, the Institute's managing director of strategy and development. "Delivery and curbside pickup may be useful in some locales, but won't be mandatory chainwide."Target is still experimenting with one-hour grocery delivery through Instacart.

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