Target shows big improvement in shipping times, researcher finds

Target may be known for many things, but getting items to customers' doorsteps quickly hasn't been one of them.

So researchers at StellaService did a double take when the Minneapolis-based retailer, which rarely makes its top 25 list for best shipping performance, jumped to the No. 1 spot in August, beating out formidable competitors such as Amazon and Apple.

"I had to dig a little deeper to make sure that was really accurate," said Kevon Hills, StellaService's vice president of research.

But it was. The study by the New York-based data analytics firm found that Target shaved three days off its delivery time. Target's packages reached StellaService analysts in 1.8 days last month, at least a day quicker than many other retailers who made the top 25.

The marked improvement comes as Target has begun shipping items directly from its stores to fulfill online orders instead of depending solely on distribution centers that may be hundreds of miles from a customer. It's a strategy that retailers such as Best Buy and Wal-Mart have been employing for at least a year in order to better compete with the likes of Amazon.

StellaService's data is just a snapshot. Its analysts in four regions of the country order core items every month from about 130 retailers in order to rate them on various customer service metrics. Its ranking measures not just speed but also quality, such as how well items are packaged. Staples, Diapers, and Zappos delivered items faster than Target last month, but Target hit the top on the basis of both speed and condition of its goods and packaging.

While one month doesn't make a trend, the data shows Target's strides to speed up delivery are paying off.

After piloting shipping from stores in Minneapolis, Boston and Miami, Target has begun rolling it out to about 140 stores in 38 markets. Target executives have said that will position the retailer to be within a one- to two-day ground transit of 91 percent of the U.S. population.

"So far, we feel really good about it," Eddie Baeb, a Target spokesman, said of the new ship-from-store capabilities.

While online sales still only make up about 2 percent of Target's overall business, faster shipping times could give customers an added incentive to buy items online from Target instead of going to Amazon, which gets items to members of its Prime membership within two days.

If it doesn't improve its shipping times, customers will wonder, "If Amazon is doing it, why is Target not doing it?" said Amy Koo, an analyst with Kantar Retail.

Richfield-based Best Buy began testing shipping from its stores last year and had it up and running in all of its 1,400 stores by early this year, helping the electronics retailer speed up delivery by a few days. According to StellaService's data, Best Buy even managed to inch out Amazon for faster regular delivery during the last holiday season.

Target and Best Buy executives have said that shipping items from stores have not only helped them cut down on air freight, but also helped them be more in stock with items on their websites.