Woolworths launches dark stores
Due to the success of Woolies Dash, Woolworths is establishing dark stores to ensure quick delivery of online orders.
Following the success of its on-demand delivery service, Woolies Dash, Woolworths is launching dark stores to guarantee prompt fulfillment of online orders. The first of these stores has opened in Cape Town’s CBD.
Why is Woolworths opening dark stores?
A dark store is not open to the public but exclusively dedicated to fulfilling online orders. Woolworths online and mobile director Liz Hilock said the company’s investment in dark stores will enable it to improve their customers’ experience, as reported by My Broadband.
This has proven to be the case with the Cape Town dark store which has markedly impacted product availability for online orders in the area.
Normally, a local Woolworths store will fulfil a Woolies Dash order. So, Woolies Dash shoppers compete with in-store shoppers at the store. This can delay the delivery of the order. With a dedicated location for online orders this problem is eliminated, leading to customers receiving quicker deliveries.
Online growth
The Woolworths on-demand delivery service reported strong growth for the financial year ended 30 June 2024. Its sales grew by 71%. Alongside this growth, Woolies Dash also enhanced its operational efficiency, achieving a 95% on-time or early delivery rate. This is a 10% improvement from last year, 2023.
The service has also led to an additional 2 200 jobs in the value chain over the last year.
According to Business Tech, Woolworths’ competitors have also seen strong sales growth in their on-demand grocery delivery services.
During the same period, i.e. the financial year ended 30 June 2024, online sales from Checkers Sixty60’s on-demand platform increased by 58.1%.
Statista reported that grocery delivery services in South Africa are rapidly expanding to meet the growing demand for convenient and contactless shopping experiences. Moreover, the number of users in the grocery delivery market is expected to reach 8.3 million users by 2029.
“In recent years, we have witnessed a remarkable transformation in consumer behaviour, with a notable shift towards the use of digital channels for shopping.”
Gabriel Swanepoel, Mastercard country manager for Southern Africa
On-demand grocery shopping first and foremost offers convenience. Customers can browse and buy a vast offering including fresh produce and everyday essentials, without leaving their homes. It eliminates driving to the store, dealing with busy stores, and waiting in long lines.