Shipt’s roots in Birmingham are deep and the company’s chief executive and its new owner want to strengthen that connection.
“We are committed to Shipt and we are committed to Birmingham,” Minsok Pak, chief strategy and innovation officer at Target, told an audience at Alabama Power’s corporate headquarters July 10. “We know that this is home. We know that this great company has come out of home. To see us and what Shipt can bring to our fulfillment capabilities and how it supports our strategy and how quickly we’ve been able to scale that, we’re real excited by that.”
Target announced in December that it was purchasing Shipt, a Birmingham-based grocery delivery startup, for $550 million. Shipt continues to operate as an independent company with its own leadership team.
Shipt founder and CEO Bill Smith said the company’s very essence is a result of starting and growing in Birmingham.
“The quality of people that work with us as shoppers is really driven by Shipt starting here in Birmingham,” Smith said. “It’s the culture of putting people first and the way we think about treating people and kind of the Southern hospitality that is the heart of Shipt’s culture that has led to the success that we’ve seen and will continue to lead us in the future.
“We’ve been able to create a personalized experience and deliver something really exceptional because of the shoppers. I think the ability to recruit those people is 100 percent credit to the culture of Birmingham and starting the company here.”
Target innovation chief Minsok Pak and Shipt CEO Bill Smith speak at Birmingham Innovation Week luncheon from Alabama NewsCenter on Vimeo.
Smith said Target’s purchase of Shipt has been a huge positive in helping the company grow to more than 150 markets across the country.
“When Target acquired Shipt, at that point we were in 70 markets, so we have had a very busy year,” Smith said.
He said Shipt has not only grown with Target’s 1,800 locations, but the company has continued to add retail partners apart from Target. He said Target gave Shipt a national anchor tenant to accelerate its growth.
Smith said Shipt now has 50,000 shoppers working for the company and he expects to be at 100,000 by year’s end.
“By the way, I will tell you if you get a call from Target and they’re interested in talking to you about your company, I highly suggest taking that call.”
Pak said Target is also seeing the benefits of the Shipt acquisition.
“The retail industry is an extremely dynamic place right now,” Pak said. “With all of this change that’s happening – constantly evolving consumers and technology – we have to follow rule No. 1, and that’s innovation has to be linked to our enterprise strategy. That means making sure that our innovation initiatives really matter to our core operations of the retail business.
“Our partnership with Bill and Shipt is a prime example of this,” he added. “One of our strategic priorities, our strategic imperatives at Target, is to leverage our 1,800 stores as fulfillment hubs – helping our guests get the product when they want, where they want, how they want them. Shipt is an important, critical part to bringing this strategy to life.”
Pak said when Target was looking at companies to acquire in keeping with its strategy, Shipt quickly stood out.
“What made Shipt stand out for us? Well, it was the proven, customer-first approach of personalized delivery,” Pak said. “That personalized service and delivery is completely in line with another core element of our strategy and that is to elevate the shopping experience for our guest. We’re investing to elevate both the physical and digital shopping experience and that proven model of putting the customer first in Shipt’s model was perfectly aligned with us.”
Tuesday, the Birmingham City Council approved incentives for Shipt, which is looking to add more than 800 jobs in the Magic City. The Jefferson County Commission is considering its own incentives at its meeting Thursday. Alabama Gov. Kay Ivey has announced she will be in Birmingham Thursday at noon for a “major economic development announcement” in the John Hand Building. Shipt is headquartered in the John Hand Building.
Shipt said the success Shipt is enjoying in Birmingham is due to the hundreds of employees it already has here.
“Sometimes you look at the CEO of a company and say, ‘Gosh, the CEO did all of that,’” he said. “But the reality is it’s all about the team and it’s all about the people that are working every day inside the company. I can tell you at Shipt, we have a tremendous team.”
