The Debate on Dark Stores
Article from MHI Solutions Magazine
Are dark stores here to stay, or are they just a supply chain experiment spurred on by a singular event and destined to fizzle out? That’s a question grocery chains and other online retailers will grapple with over the next few years as they continue to adapt to changing consumer preferences.
COVID-19 fueled a sharp rise in online shopping, leading grocery chains and major retailers such as Walmart to invest heavily in dark stores. The customer-free micro-fulfillment centers, often located in shuttered retail stores, enable retailers to offer faster delivery to customers in densely populated communities.
Dark stores serve as small warehouses or distribution centers, using automated material handling equipment and small staff to process high volumes of orders. Many dark stores allow customers to pick up orders, lessening the burden of lastmile delivery for retailers. Since last mile delivery typically is the costliest leg of the supply chain, making it easy for customers to pick up their orders is one way online retailers can improve their operating margins…
