What are Dark Stores?
The future of the retail ecosystem after the pandemic, dark stores are essentially brick-and-mortar retail stores or supermarkets converted into e-commerce warehouses or distribution centers or local fulfillment. Dark stores can exist in the form of grocery, clothing, footwear, second hand consumables, and homeware retail stores. These D2C (Direct-to-Consumer) businesses provide the convenience of customers in terms of online shopping and ordering systems in the dark store, same day delivery, and in-store pickup. With a combination of retail and e-commerce, dark shops are not open to end customers. However, shoppers can make digital purchases through online shopping platforms from dark stores (be it an online store or a mobile app), with the merchandise being purchased. delivered to their door or picked up by the buyer from a pre-selected location.
Dark shops are often located near neighborhoods or high-demand areas. For retail segments like clothing and durable goods, they can even be set up on the outskirts of town. The dark store concept favors the establishment of medium-sized local warehouses to store, sort and manage orders, to facilitate quick and economical picking, and to facilitate automation. As retailers strive to win and retain customers in real-time across multiple touchpoints, most stores today are integrating dark store to reduce cart abandonment and increase profit margins.
It leads to a challenge for retailers
With some stores promising to deliver in as little as 10 minutes, retailers need to find ways to monetize this channel and avoid the losses that can result from poorly designed business practices. Dark stores must be efficient to meet demand for fast delivery and real-time inventory. Relying on traditional retail operations, these new “storefronts” face major challenges to do well. Fortunately, new technological innovations are paving the way for these models to flourish. Using new mobile-based retail management solutions, hyper-local delivery companies and fast paced commerce, retailers can survive another COVID winter and busy holiday season busy.
Advantages of Dark Stores
Simple Task Management
The dark shops don’t serve customers inside the warehouse, but there’s still a lot of work to be done on the floor. Management can simplify task assignment and monitoring with a cloud-based solution. Using an app, supervisors can capture important tasks and assign them to the right people. Employees can then notify management when work is completed via the same platform, or leave comments and explanations as needed.
Unlike brick-and-mortar retail or e-commerce, dark store operations don’t just involve a single store or warehouse. So in addition to pickers moving around the floor to prepare orders, expect workers to be on duty for curbside pickup and door-to-door delivery. A unique mobile solution with video call functionality that eliminates the hassle of finding a phone number, especially in an emergency. Just open the app and scroll down to find the name of the person you need to contact.
Excellent Operations Optimization
Since new retail technologies run in the cloud, the central office can monitor dark store activity and detect problem areas. Through audits and intelligent analytics, retailers can identify the specific challenges and problems they face at each location, adopt newer and better processes, and ensure that employees understand them.
Accessible Remote Monitoring
Storing furniture and shelves in the store has never been easier with Photo Stories. Management can monitor activity remotely while empowering to take real-time corrective actions. This means less hassle on the floor and smoother operation.
Efficient Performance Standardization
Dark Shop operations involve a number of repetitive tasks, including inventory control and floor maintenance. Using digital checklists for those managing them can eliminate non-compliance and ensure a consistent process while eliminating the inconvenience and costs associated with paper checklists. If they haven’t already, a COVID-19 checklist is needed at this time to keep customers and employees safe.
The Future of Dark Stores
The future of this segment is brighter than the name implies. By 2025, India’s CPG (Consumer Packaged Goods) market is projected to reach approximately US $ 1 trillion and Southeast Asia’s online food market is projected to reach US $ 11.9 billion. This is a great opportunity for dark store operators.