A shot in the dark for industrial property

A shot in the dark for industrial property

Industrial - Workplace December 2019

A shot in the dark for industrial property

The face of industrial property is changing all the time in response to evolving consumer shopping patterns and new business models designed to create efficiencies in the e-commerce space.

We’ve talked before about ghost kitchens springing up to effectively and seamlessly fulfil home-delivered food orders away from a storefront restaurant/kitchen. These remote-located preparation kitchens allow for better dine-in service for those choosing to eat out and a more efficient blueprint for the preparation and delivery of food ordered from a restaurant via apps.

Now, the fast moving consumer goods (FMCG) sector in New Zealand is following in the proven footsteps of the UK and USA and testing the concept of e-stores or “dark stores”.

In response to escalating demand for online grocery shopping, Countdown will open its first "dark store" in April 2020 and while it may have stacked shelves and around 27,000 products in stock – just like a regular supermarket, no customers will ever step foot in it.

Progressive Enterprises (Countdown) says the dark store in Penrose will fulfil online home delivery orders from 10 of its Auckland stores and with growth in digital orders of 38 per cent in the last quarter of 2019, it’s an initiative that seems well-timed.

A team of 165 personal shoppers dedicated solely to serving thousands of online delivery customers will pick and pack orders without disruption from trolley-wheeling customers requiring personal service in the traditional store which until now, has had a dual role of instore and online fulfilment.

There will be some forward-thinking automated technology capabilities in place at the new dark store designed to streamline the location of products and speed up the pick and pack process to better cope with customer-driven expectations around same-day ordering and delivery windows.

Supermarkets will need to fine-tune their omnichannel service offerings as the face of supermarket shopping has forever changed.

A customer’s online order can have so many product combinations and variations that expecting on-floor staff to select and pack these multi-faceted orders in a timely manner while maintaining food quality is a big ask.

There’s a high level of accuracy expected and required to maintain customer satisfaction and ensure repeat business.

The traditional grocery store model with its ever-changing in-store inventory is not tailored to fulfilling large volumes of online orders.

A dark store has a much better chance of hitting fulfilment and delivery targets and reducing customer and call centre staff frustration.

Choosing the optimal location for these dedicated e-grocery stores is a fine art in itself. Real estate dynamics are evolving so quickly and with last mile delivery credentials so crucial in the locational mix, well-positioned industrial property is going to be hotly-contested.

We’ll watch this new e-commerce trend with interest – fingers crossed, the frozen goods arrive solid…

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