By Liz Young

Tractor Supply is revving up its final-mile fulfillment operation as part of a push to grow digital and business-to-business sales.

The Brentwood, Tenn.-based company is hiring drivers and renting fleets of vehicles such as pickup trucks and trailers to handle more customer deliveries itself, including for bulky goods like 50-pound bags of cattle feed and chicken coops.

Tractor Supply plans to fulfill more orders for delivery out of its 2,300 stores across the U.S. as well as its 10 distribution centers and 10 so-called mixing centers, where it stows additional inventory close to stores for faster replenishment.

Chief Supply-Chain Officer Colin Yankee said the third-party delivery companies that Tractor Supply has relied on aren't typically designed to fulfill orders in the rural areas where many of its customers live.

"We have our stores in these rural locations already," Yankee said. "We understand these markets and have the brand equity with our customers in order to be trusted onto their properties and for their business."

The company's push comes as e-commerce giant Amazon.com invests $4 billion in expanding its delivery network in rural areas. Other retailers, from big-box chains Walmart and Target to specialty merchants such as Advance Auto Parts, have in recent years built up their final-mile capabilities, including by fulfilling more customer orders out of stores.

"These stores can act as distribution points if they carry just a little bit of inventory of parts that are more frequently utilized," said Rob Handfield, a supply-chain management professor at North Carolina State University.

Tractor Supply is working to grow online sales as well as so-called direct sales, where customers such as farms and businesses that frequently order in bulk work with dedicated salespeople.

The retailer said at an investor day presentation in December that it had grown digital sales more than 340% over the previous four years to more than $1 billion in 2024. The company's goal is to grow its digital business to about 10% to 12% of sales by 2029, from roughly 8% today.

In the markets where Tractor Supply offers final-mile fulfillment, the company said it has an average order size of nearly $400 -- larger than its typical order size -- as well as higher customer satisfaction scores, higher repeat orders and lower return rates.

Tractor Supply extended its delivery capabilities during the pandemic as homebound customers sought out more convenient shopping options. The company uses third-party delivery providers such as DoorDash and Roadie, owned by United Parcel Service, as well as ground shipping via parcel carriers such as UPS and FedEx.

But Yankee said delivering big and bulky goods to rural properties can be difficult. A third of customers surveyed by the company said they live off gravel or dirt roads, and about 70% can't accommodate a large box truck due to overhanging trees or tight turnarounds. Yankee said he believes the company can deliver orders more efficiently by relying on its own workers who can get to know the customers and the routes.

Tractor Supply plans to continue working with its existing delivery partners for smaller e-commerce orders such as apparel or dog collars, Yankee said. "We see it as different tools for different jobs," he said.

Write to Liz Young at liz.young@wsj.com

(END) Dow Jones Newswires

August 04, 2025 13:59 ET (17:59 GMT)

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