Shipt: The Evolution of a Leading American Delivery Service
In the rapidly changing landscape of modern retail, Shipt has emerged as a pivotal player in the on-demand delivery sector. Headquartered in Birmingham, Alabama, this American delivery service provides a bridge between local retailers and consumers, offering the convenience of same-day delivery for groceries, home products, and select electronics.
Originally founded as an independent startup, Shipt has grown into a major subsidiary of the Target Corporation, fundamentally changing how many Americans approach their weekly shopping routines.
Key Facts
- Founded: 2014 by Bill Smith
- Parent Company: Target Corporation
- Headquarters: Birmingham, Alabama, US
- Business Model: Membership-based same-day delivery
- Membership Cost: $99 per year
- Delivery Network: Over 300,000 self-employed Shipt Shoppers
Company History and Growth
The journey of Shipt began in 2014, founded by entrepreneur Bill Smith. Following his success in various business sectors—including cellphone, small loan, and prepaid Visa card businesses—Smith launched a soft launch of Shipt in Birmingham, Alabama, with 1,000 pre-enrollment customers. The official launch followed in May 2015.
The company's growth trajectory was fueled by significant venture capital. In July 2016, Shipt secured a $20 million Series A investment led by Greycroft Partners, e.ventures, and Harbert Growth Partners. This was followed by a $40 million Series B round in June 2017, which allowed the company to expand its footprint to 47 markets across the United States.
The Target Acquisition
A defining moment in the company's history occurred on December 13, 2017, when Target Corporation announced its acquisition of Shipt for $550 million. The goal was to bolster Target's same-day shipping capabilities. Despite the acquisition, Shipt continued to operate as an independent subsidiary, maintaining partnerships with various retailers beyond the Target ecosystem.
Leadership Transitions
As Shipt scaled, its leadership underwent strategic changes to match its growing complexity. In March 2019, Kelly Caruso, a Target veteran, took over as CEO, while founder Bill Smith transitioned into an advisory role.
In February 2022, the company announced Kamau Witherspoon as the new CEO, effective March 1, 2022. Witherspoon brought extensive operational expertise from leadership roles at UnitedHealthcare, Yum! Brands (specifically the KFC US division), and Target, where he served as Senior Vice President of Operations.
How the Service Works
Shipt facilitates same-day delivery through a user-friendly interface available via iOS, Android, and web browsers. The service operates on a membership model, which costs $99 per year.
The delivery process is powered by a massive network of more than 300,000 Shipt Shoppers. It is important to note that these individuals are not employees, but rather self-employed contractors who fulfill orders on behalf of the company.
Retail Partnerships
One of Shipt's greatest strengths is its diverse range of retail partners. Members can place orders from a wide variety of well-known brands, including:
- Grocers: Costco, CVS, H-E-B, Kroger, Publix, Safeway, and Winn-Dixie.
- Specialty & Home: ABC Fine Wine & Spirits, Office Depot, and OfficeMax.
- Regional Favorites: Jewel Osco, Meijer, and ShopRite.
Summary of Shipt Overview
| Category | Details |
|---|---|
| Industry | Retail / Delivery Service |
| Founded | 2014 |
| CEO | Kamau Witherspoon |
| Revenue (2018) | US$1.0 billion |
| Platforms | iOS, Android, Web |
Frequently Asked Questions
Who owns Shipt?
Shipt is a subsidiary of the Target Corporation, which acquired the company in 2017.
How much does a Shipt membership cost?
A Shipt membership costs $99 per year.
Are Shipt Shoppers employees?
No, Shipt Shoppers are self-employed contractors who deliver orders on behalf of the company.
What can I order through Shipt?
Members can order a variety of items including groceries, home products, and select electronics from participating local retailers.
How do I access Shipt services?
You can use Shipt through its native applications on iOS and Android, or via their website.