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Shopping has never been so easy today. From days, same-day, until only 15-minutes delivery time, more e-commerce companies provide faster delivery services of groceries to the customers. Currently, Dark Store (Quick Commerce) has been emerging in Indonesia. Several companies try to promote delivering groceries as fast as possible by distributing the hub to acquire more customers and make the delivery more efficient.

Quick commerce is an extension of the E-Commerce concept where the customers are no longer needed to come to the store to buy household goods. Some known companies that started businesses such as Astro, DropEzy, Radius, and Bananas promote 15-minute delivery times. In addition, the living legend Alfamart and Indomaret are also entering the Quick Commerce segment by developing Alfagift and KlikIndomaret.

What is the Dark Store?

While many modern retail companies build big warehouses near urban areas and sell their products in urban areas with prime locations, Dark stores utilize small spaces to store and deliver goods. Also, they do not need to be located in prime real estate to minimize the operation cost compared to the big retail.

To use this service, customers place their orders through the app on their phones. The nearby Dark Store will receive the order and start picking-packing the products. Then they quickly send the products through last-mile delivery, usually on a motorcycle or bike. By placing and distributing the hub close to the residential complex and apartment, Dark store can make the delivery time more efficient and cover its target market.

What makes Dark Store successful?

According to research by Jordan Berke (CEO of Tomorrow Retail Consulting), key success factors could divide into three parts:

1. Assess Demand

Start with existing demand, do not open dark stores hoping that demand will come. Ensure that the location already has the existing online market in the trade area. Ensure that more than 80% of BEP required demands are in place before opening.

2. Location Quality

Unlike the other modern retail, Dark Stores do not need ample space for the customer to come and occupy prime real estate. Find low-cost space, even the lowest possible quality space that can get permitted and be functional.

3. Start Simple

Do not go with an automation strategy. At least it would help if you let the operation learn the operation model of a dark store before starting a significant CAPEX for automation to the Dark Store.

How can Cityplan help?

How can we find the best location for maximum coverage and market fit for your Dark Store expansion? As the Expansion Manager, you need to find the ideal places for a dark store in Indonesian cities. Cityplan can help your team expand to new markets; the first step to focus on is the suitability of the market, including high demand of population density, customer profile and segment, and online transaction demand. We can analyze each potential site by looking at a set of Dark Store parameters within each delivery territory management using our Spatial Data Library, such as:

  • Demographic
  • Consumer profile and segments
  • Housing complex distribution
  • Demand generator
  • And other parameters.

Also, to support your 15-minute delivery service, our tools can help your team maximize the hub coverage while maintaining its SLA. We can also consider the road network characteristic in each location to enable your vehicle’s navigation on this tool.

Will Dark Store disrupt how the retail industry works? Let’s discuss!