Dark Stores are beginning their expansion in Poland. There are more and more companies offering purchases in this model. This is the result of the pandemic and the rapid development of e-commerce. During the lockdown, Poles began to order products on a large scale, including food, meals and drinks with home delivery. It seems that this type of shopping is now well established in Poland.
Dark store – what does it actually mean?
Dark stores owe their name to the fact that they are physically inaccessible to customers. In fact, they are not even shops, but small warehouses from where couriers pick up the products ordered by customers. Interestingly, this is not a new concept. The first dark stores were created over a decade ago in Great Britain, by Tesco.
In Poland there are already companies operating in this model, which ensure that they deliver purchases ordered online even within 10 minutes from the moment of ordering. The prices they offer for products are supposed to be the same as in local shops. If the amount of the order exceeds a certain value, there is no delivery charge. Also important for consumers is the fact that dark stores are open every day, from morning to evening, even on non-trade Sundays.
The effect of pandemics and the e-commerce boom
Such intensive expansion of dark stores is the result of pandemics and lockdowns. With the closure of brick and mortars, online shopping has gained importance. According to research, the growth rate of the e-commerce market was 40% y/y higher in Poland, and 84% of Poles already shop online. Consequently, food and grocery delivery has also gained importance. Today, food and grocery delivery companies play an important role in the trade.
Convenience and hyper-locality, are key trends emerging from the pandemic. Dark stores offer delivery flexibility in terms of time, flexibility and service levels. There are already companies in our market that offer delivery of products within 10 minutes of ordering, which can be crucial for many consumers. These shops only support online shopping, which allows them to concentrate and specialise on one channel – points out Martin Oxley, Non Executive & Supervisory Board Director at Exorigo-Upos S.A.
Convenience and speed of delivery
The convenience of shopping, mentioned in the above comment, is an important factor for the development of dark stores. According to international research, 78% of consumers value it more than before the pandemic, and 45% value convenience over price when making purchases.
Another is the delivery time of products. Companies offering shopping in the dark store model, ensure that they deliver ordered goods within 10-15 minutes. The study E-commerce in Poland 2020 by Gemius for E-commerce Poland shows that consumers are most motivated to buy online by the fastest possible delivery time. 37% of Polish consumers would be willing to pay extra for the shortest possible delivery time. Hence, apart from dark stores, the growing popularity of such forms of delivery as click & collect or ship from store (more information about them you will find in our article).
Another factor is the time of delivery. Companies which offer purchases in the dark store model, ensure that they deliver ordered goods within 10-15 minutes. The report E-commerce in Poland 2020. Gemius for E-commerce Poland shows that consumers are most motivated to buy online by the fastest possible delivery time. 37% of Polish consumers would be willing to pay extra for the shortest possible delivery time. Hence, apart from dark stores, the growing popularity of such forms of delivery as click & collect or ship from store (more information about them you will find in our article).
Does the future of the dark stores in Poland looks bright?
Research also shows that once the pandemic is over, consumers will stick to their new habits. So it seems that the concept of dark stores will settle on the market for longer and its expansion will continue. Poland has huge potential for growth and there is still a lot of room for expansion in this area, especially in larger cities.
New retail models are very much focused on customer centric omnichannel. A dark store is a key part of a localized offer. It enables the retailer to offer a more competitive fulfilment strategy. If the dark store is located in a densely populated area it can be a really profitable and, importantly sustainable way, of e commerce customer service. They could also be deployed to accept returns. Keep in mind the brand battle is moving to the ‘last mile’ – a great fulfillment experience goes a long way to winning the battle – says Martin Oxley. And adds: Retailers need to additionally take care of the traditional sales channel. What is more, a brick and mortar may face restrictions on sales, e.g. during lockdown, whereas a dark store will not be affected by such restrictions – it will continue to operate, providing continuous sales services.
Not surprisingly, large retail chains want to incorporate this model into their sales channels. However, in this case, dark shops will rather operate alongside chain shops, from where fresh products will be delivered to online customers.