Costco Wholesale (COST.O), missed analyst expectations for third-quarter revenue on Thursday and said it had pulled forward shipments of some goods it had planned to import this summer to lower the impact of U.S. tariffs.
The membership-only retail chain said raising prices would be a “last resort”, unlike larger rival Walmart (WMT.N), which has said that it would have to start raising prices later this month.
Target (TGT.N), opted not to raise prices, but slashed its annual outlook.
Companies, especially retailers, are grappling with higher costs involved in moving supply chains away from China, which has borne the brunt of U.S. President Donald Trump’s tariffs.
That, coupled with muted consumer spending in an uncertain environment, has hit bottom lines. U.S. consumer sentiment slumped to a nearly three-year low in May.
Costco said on the post-earnings call that it had re-routed many goods sourced from countries with large exposure to Trump’s tariffs to its non-U.S. markets.
The popularity of Costco’s private label products, which tend to undercut higher-priced branded alternatives, and consumers stocking up on essential goods, helped the company beat expectations for comparable sales in the quarter.
“As inflation and supply chain concerns drive more consumers to buy in bulk, warehouse clubs like Costco are gaining traction,” said eMarketer analyst Zak Stambor.
Same-store sales, excluding gas, rose 8% for the quarter ended May 11, compared to an estimate of a 6.96% increase, according to data compiled by LSEG.
The company’s quarterly revenue rose 8% to $61.96 billion, missing analysts’ average expectations of $63.19 billion.
Excluding items, Costco earned $4.28 per share, slightly above analysts’ estimate of $4.24 per share.
Shares of the company, which have risen about 10% this year, were flat in extended trading.
Australian retail sales slipped unexpectedly in April as warm weather hit spending on winter clothing, data showed on Friday, while department stores suffered from a dearth of discounting events in further evidence of a cautious consumer.
The weakness came despite lower borrowing costs and a cooling in inflation, supporting investor wagers for a further cut in interest rates when the Reserve Bank of Australia next meets in July.
Data from the Australian Bureau of Statistics showed retail sales fell 0.1% in April from March, confounding analyst forecasts for a 0.3% increase and ending three months of gains.
Sales of A$37.2 billion ($23.91 billion) were up 3.8% on a year earlier, a slowdown from 4.3% in March and historically sluggish given annual population growth is running around 1.7%.
Food, clothing and department stores all saw falls, while household goods and eating out had a better month due in part to catch-up spending in Queensland following widespread floods.
“Clothing retailers told us that the warmer-than-usual weather for an April month saw people holding off on buying clothing items, especially new winter season stock,” said Robert Ewing, ABS head of business statistics.
Retail sales account for around 35% of household consumption, so the data point to a soft start to the second quarter. Consumption made almost no contribution to economic growth last year, a miserly result usually only seen during recessions.
That weakness was a major reason the RBA cut interest rates by a quarter point to 3.85% this month, and why markets expect at least three more easings this year to 3.10%.
Its first rate cut in February seemed to have little impact on consumers, with retail sales flat in volume terms over the March quarter and broader spending only inching ahead.
The frugal outcome led the RBA to again downgrade its forecasts for consumption this year, though it still hopes a combination of past tax cuts, slower inflation and falling borrowing costs will embolden consumers over time.
Not helping the mood has been the wild swings in financial markets of recent weeks as U.S. President Donald Trump’s tariff plans darkened the global economic outlook.
Surveys showed a slump in consumer confidence in April that was only partly repaired by a pullback in sky-high U.S. tariffs on China, Australia’s single-biggest trading partner.
Walmart Inc is betting on India, Mexico, and China to drive the next phase of its international expansion, with a particular focus on scaling up ecommerce and omnichannel capabilities in these fast-growing markets.
The retail giant sees these regions as strategic priorities within its global portfolio, according to Kathryn McLay, president and chief executive, Walmart International. The division oversees the Bentonville-based retailer’s operations outside the United States (US), including its global online platforms.
McLay noted India, home to 1.4 billion people, represented a major opportunity in ecommerce. India’s internet economy is estimated to reach $1 trillion by 2030, primarily due to ecommerce. Yet online penetration remains relatively low, at just 9 per cent, highlighting the headroom for growth. To tap that opportunity, Walmart is continuing to build its Flipkart business, with ongoing investment in both established channels and newer retail formats.
“We see huge opportunities in that market, and we have been growing the Flipkart business,” said McLay during a fireside chat with Bernstein analyst Zhihan Ma at the Bernstein 41st Annual Strategic Decisions Conference 2025 in the US on Wednesday.
Walmart entered India in February 2018 through its $16 billion acquisition of ecommerce firm Flipkart, which operates as a pure-play online 3P (third-party) marketplace.
The original premise for Flipkart was to bring branded items to Tier-II and -III cities, where access to such products was earlier limited. Consumers in these areas would often travel to Tier-I cities for items like Levi’s products. Flipkart initially focused on categories such as mobile phones, electronics, and apparel, and these core categories have since reached profitability. As the business matured, McLay said Flipkart had been expanding both its assortment and its overall offering to meet evolving customer needs.
In recent years, McLay said quick commerce had emerged as a major trend in India, defined by delivery times of 15 minutes or less. Recognising this shift, Flipkart has developed what it calls its “Minutes business”, specifically designed to enable delivery within this new, accelerated time frame. The company has established 250 fulfilment centres to support this model, marking a significant transformation from its previous one-to-two day delivery promise just a year ago. Today, Flipkart can deliver some orders in as little as three minutes, showcasing remarkable operational speed and agility.
“It was a one- to two-day promise. Now we have a 15-minute promise, and sometimes we can deliver in as short as three minutes,” said McLay. “Those capabilities are insane for me. They’re kinda mind blowing.”
Quick commerce now represents about 20 per cent of the ecommerce market in India and is experiencing a 50 per cent annual growth rate.
While Flipkart continues on its path to profitability with its core business, McLay said the firm was investing in emerging areas like quick commerce as part of its broader growth strategy.
Walmart views this expansion not as a linear path to profitability but as one that is supported by strong international proof points across markets and channels, reinforcing confidence in the long-term trajectory, according to McLay.
Flipkart is also incorporating global best practices into its operations. When the rise of quick commerce became evident, McLay said Flipkart Chief Executive Officer (CEO) Kalyan Krishnamurthy referred to Walmart’s operations in China, specifically the cloud-based fulfilment model used by Sam’s Club, where 1,000 SKUs (stock-keeping units) are delivered in less than one hour.
Flipkart sent a team to China to study this model, which provided insights into optimising fulfilment for speed. Based on the experience, Flipkart aimed to improve on the model by scaling up to 6,000 SKUs delivered in less than 15 minutes.
“When we saw the rise in quick commerce, our CEO of Flipkart asked me, where can I learn across Walmart Enterprise about speed? And I pointed him to China,” recalled McLay.
These adaptations are now being shared with other markets, including China, showcasing how learning flows both into and out of India within Walmart’s global network.
McLay also shared insights about Flipkart’s growth and profitability. In contrast to Walmart’s China operations, which are largely first-party and do not include digital advertising, she said Flipkart’s business model included digital advertising as a revenue stream and as part of its overall profitability profile.
“One of the hidden gems, I think, in the Flipkart business is Myntra,” said McLay.
One of the standout elements within Flipkart is Myntra, its dedicated app and brand for beauty, apparel, and accessories. Myntra has built capabilities around customisation and hyper-personalisation, and is regarded as a leader in the use of generative AI within Walmart International. For example, Myntra enables users to enter personalised prompts such as “I’m going to a wedding in Kerala in the summer with guests mostly in their twenties, and it will be semi-formal”, in response, the platform generates four different outfit looks
Flipkart’s broader business strategy continues to focus on the core ecommerce model, Myntra’s advanced personalisation capabilities, and the expansion of quick commerce. Walmart confirmed that the business was on the right growth trajectory and that while profitability was a goal, the company would not sacrifice market share and long-term growth to achieve it prematurely.
Shein aims to file prospectus for Hong Kong IPO in coming weeks
Company plans to go public in Hong Kong within this year
Shein plans to change venue in absence of Chinese regulatory nod
Shein is working towards a listing in Hong Kong after the online fast-fashion retailer’s proposed initial public offering (IPO) in London failed to secure the green light from Chinese regulators, said three sources with knowledge of the matter.
The China-founded company aims to file a draft prospectus with Hong Kong’s stock exchange in the coming weeks, one of the sources said. Shein plans to go public in the Asian financial hub within the year, two of the sources said.
The Reuters Tariff Watch newsletter is your daily guide to the latest global trade and tariff news. Sign up here.
Shein plans to change the listing venue as it had not yet received approval for its London IPO from Chinese regulators, notably the China Securities Regulatory Commission (CSRC), the two sources said.
The company, which sells products including $5 bike shorts and $18 sundresses, in March secured approval from Britain’s Financial Conduct Authority (FCA) for its IPO in London, and soon informed the CSRC, one of the sources said.
The company initially expected the green light from Chinese regulators to follow swiftly after the FCA but has since experienced an unexpected delay and limited communication from the CSRC, said the source.
Details about Shein’s Hong Kong listing plan have not been reported previously. All the sources spoke to Reuters on the condition of anonymity as they were not authorised to speak to the media.
Shein and CSRC did not immediately respond to Reuters request for comment. A spokesperson for Hong Kong Exchanges and Clearing Ltd (HKEX) (0388.HK), opens new tab declined to comment on individual companies.
Before its attempt to list in London, Shein had pursued a listing in New York, as part of its efforts to gain legitimacy as a global, rather than a Chinese company, and access to a wide pool of large Western investors.
A listing in Hong Kong would go against that strategy and could hurt its global credentials.
Allegations that Shein’s products contain cotton from China’s Xinjiang region and a planned legal challenge to the London IPO by a non-governmental organisation campaigning against forced labour in China have complicated the London listing and risk embarrassment for the Chinese government, a separate source with direct knowledge of the matter said.
Tensions with the U.S. over trade only exacerbate the wariness of Beijing and the CSRC, the source said.
The United States and NGOs accuse China of human rights abuses in the Xinjiang Uyghur Autonomous Region, where they say Uyghur people are forced to work producing cotton and other goods. Beijing has denied any abuses.
Shein, founded by China-born entrepreneur Sky Xu, says it has a zero tolerance policy over forced labour and child labour in its supply chain. The company moved its headquarters from Nanjing, China, to Singapore in 2022.
As it awaited a response from the CSRC, Shein earlier this month dropped the communications firms Brunswick and FGS it had hired to help with public relations ahead of the London listing.
IPO VALUATION
Reuters could not determine if Shein had sought or received a nod from the CSRC for the Hong Kong listing. The company had sought Chinese regulatory approval for going ahead with processes to list in New York and later in London.
Shein’s filings with the CSRC make it subject to Beijing’s listing rules for Chinese firms going public offshore, two sources have said.
The rules are applied on “a substance over form” basis, giving the CSRC discretion on when and how to implement them, the sources added.
Shein does not own or operate any factories, and instead sources its products from 7,000 third-party suppliers in China as well as some factories in other countries like Brazil and Turkey.
Shein’s aim was to go public in London in the first half of this year.
But its business model of sending products straight from factories to shoppers around the world has been disrupted by the Trump administration ending duty-free access and slapping steep tariffs on e-commerce packages from China.
The “de minimis” exemption allowed e-commerce packages from China worth less than $800 to enter the U.S. duty-free and helped Shein, Temu, and Amazon Haul sell clothes, gadgets and accessories extremely cheaply.
Now, those parcels are subject to a minimum tariff of 30%.
Regardless of where Shein lists, its eventual IPO valuation will hinge on the impact of the removal of the de minimis exemption, the sources have said. The U.S. exemption is still in place for goods that are not from China or Hong Kong.
The European Union has also proposed changes to its duty exemption on parcels under 150 euros, adding to pressure on the business model.
Reuters reported in February that Shein was set to cut its valuation in a potential London listing to around $50 billion, nearly a quarter less than the $66 billion valuation it had achieved in a $2 billion private fundraising in 2023.
A revival in Hong Kong’s capital market, with sizable recent listings including Chinese electric vehicle battery giant CATL’s $5.3 billion float, the world’s largest listing this year, augurs well for a potential Shein IPO in the city.
Companies have raised $9.7 billion in Hong Kong through IPOs and second listings so far in 2025, compared to $1.05 billion at the same time last year, according to LSEG data.
Author Credits: Julie ZHU, Hadeel Al Sayegh and Helen Reid Reuters
Recently launched fashion chain Ayana could have hundreds of stores, the CEO of its owner Pepkor told Reuters, as the South African retailer targets trendier customers and embraces the fast-fashion model of some rivals.
Pepkor, the owner of the budget Pep and Ackermans clothing chains, is underrepresented in the adult clothing market, especially womenswear. Recently, it expanded into that market by acquiring fashion businesses such as Legit, Style, and Swagga.
It launched 32 Ayana stores in February by converting discontinued Ackermans womenswear stores. The brand is more fashionable than Pepkor’s core chains and aims to refresh its ranges more frequently, with some shoppers comparing its style and store layout to Inditex-owned Zara.
“This is not like a thousand-store chain. It will be, I suppose, a couple of hundred if it’s really successful, maybe two or three hundred,” Pieter Erasmus, chief executive officer of Pepkor, told Reuters on Tuesday.
Ayana targets fashion-conscious young women with its waistcoats, bow mini dresses, and collarless jackets, “but at a price which is affordable,” Erasmus added, compared to international brands like H&M.
“Customers have responded well in the store, in sales, but also on social media. So we think that there’s an opportunity for this brand in South Africa to do, again, I don’t like using this word ‘Zara-type’ aspirational (fashion),” he said.
He added that Ayana was also trying to tap customers who “are currently buying from some Chinese (retailers like) Shein. There’s an opportunity to really address that. So we’re going to put a big effort into it.”
Online-only retailers Shein and Temu have grown rapidly by shipping inexpensive products directly to consumers, forcing local retailers to find new ways of differentiating themselves.
Ayana currently sources its stock from Asia, particularly China, and locally in order to respond faster to changing trends, Erasmus said.
Stroll down any major shopping thoroughfare in Australia and you’ll come across dozens of beauty retailers jostling for your attention. Mecca, Wesfarmers’ Priceline and smaller retailers such as W Cosmetics have all carved out a cosmetic counter of their own in the market.
Among them is Sephora, the American brand owned by luxury conglomerate LVMH.
Since entering Australia in 2014, Sephora has expanded to 32 stores (with 3000 stores globally), including a new store in Bankstown in Sydney’s south-west. The company plans to open two more stores by year’s end.
Sephora generated $315.8 million in revenue between 2019 and 2023 with net loss profit after tax of minus $13.7 million, according to data from IBISWorld, although Sephora reports the average spend in 2025 has seen double-digit growth compared to pre-COVID 2019 levels.
Despite recent gains, IBISWorld data shows it commands 6.1 per cent of the market while Mecca maintains a 21.4 per cent stake hold.
Jenny Cheah, Sephora’s Singapore-based managing director in South-East Asia, Oceania and India, says Australia remains a key focus for the brand.
“Australian consumers are extremely sophisticated. They understand beauty trends very well, are educated, and we want to be here with them for their journey in beauty,” she says.
It’s a competitive sector. Market share concentration in the beauty sector remains low, with a high number of smaller retailers, leaving room for other players to lay claim to a slice of the pie.
To this end, Wesfarmers has been expanding its beauty offerings in Priceline and a new dedicated beauty store atomica, while Adore Beauty launched its first bricks-and-mortar store in Melbourne last year after 25 years in business.
Dr Marian Makkar, a senior marketing lecturer at the Royal Melbourne Institute of Technology, says differentiation is a key challenge for multi-brand retailers. Exclusive brand partnerships and a warm, bespoke customer service experience with an emphasis on bricks-and-mortar retail are central.
“When you go into the retail space itself, you want to feel like an exclusive customer,” she says.
For Mecca, staff training is an essential part of the offering, with the brand investing four per cent of turnover in education.
“Our team members are true beauty experts – deeply knowledgeable about our brands, products, and application techniques – and skilled at sharing that expertise in a warm, engaging, and high-touch way,” the company told this masthead.
While Sephora’s two main competitors in Australia – Mecca and Priceline – are Australian-owned, Cheah thinks its international positioning gives the brand an edge.
“We go back to the profile of our consumers, and they’re more well travelled. The fact they come to Sephora, they can shop anywhere in the region and they will still be able to earn points,” she says.
“We bring global brand equity and exclusive brand partnerships.”
Makkar attributes Mecca’s success in part to its high concentration of exclusive brands (around 80 per cent). It appears to be working, with revenue growing from $971.5 million in 2022 to an estimated $1.3 billion for the 2025 financial year.
Sephora was unable to say what percentage of its more than 500 brands were exclusive, but it’s clear that it’s a strategy pivotal to retailers’ success, at a time when consumers can order online or buy in store.
This month, Sephora will add Lady Gaga’s Haus Labs to its stable of Sephora-only brands in the Asia-Pacific region, which also includes Selena Gomez’s Rare Beauty and Rihanna’s Fenty Beauty. First launched in 2019 on Amazon, Haus Labs relaunched in 2022 with Sephora. Cheah thinks this has been key to it becoming one of the highest-earning celebrity beauty brands today.
“With all due respect to Amazon, I think Haus Lab’s story is better communicated [at Sephora], and I think the brand appreciates that out of us as well,” says Cheah.
In today’s oversaturated market of celebrity beauty brands, it takes more than a famous face to move product.
“Consumers today are so savvy. They won’t spend money on products that don’t work, no matter how inexpensive they are,” says Cheah.
She thinks Haus Lab’s focus on “clean beauty” (defined by Sephora as products free from ingredients such as phthalates, sulphates and parabens), skincare-based make-up and focus on social issues (a portion of every sale goes to support Gaga’s charity, Born this Way Foundation) have all contributed to its success.
In June, Sephora and Haus Labs will create 31 activations across Australia in line with Global Pride Month.
Cheah says Haus Lab’s foundation is the top-selling foundation in US Sephora, with similar hopes for the Australian market.
Sephora has made a concerted effort to support Australian beauty brands too – most notably Ultra Violette, a sun care brand that’s seen rapid success since launching in 2019.
Ultra Violette is sold exclusively in store at Sephora Australia, and has recently entered into the US and Asian markets, again with the help of Sephora.
But securing that coveted “exclusivity” can be tough – Ultra Violette is also available direct from its website and on The Iconic. Cheah is pragmatic.
“A brand deserves to have the brand available to consumers in the way they would like to be. We cannot put a frame around that,” she says.
“In some cases, like Ultra Violette, we would love for them to just be in Sephora and only in Sephora because that gives them a greater marketing edge as well with us.”
Indeed, when brands have the ability to go direct to consumer, why enter an exclusive partnership with a retailer like Sephora?
Cheah says a partnership offers a brand access to their global supply chain, consumer data, merchandising and advice on product development. And she thinks having multiple fronts in different retailers can confuse shoppers about a brand’s messaging.
From a consumer standpoint, Makkar says multi-retailers offer convenience for busy shoppers.
“People are looking for a one-stop shop … you have options all the way from Australian brands, all the way to international brands.”
Author Credits: Lauren Ironmonger The Sydney Morning Herald
Keemart offers a practical and timely solution for residents seeking quick, reliable access to groceries and household necessities
Saudi Arabia – Keeta, the international subsidiary of Meituan – China’s leading on-demand delivery giant – has officially launched Keemart, a new grocery delivery service designed to bring everyday essentials to users’ doors in just 15 minutes.
The service is now live in the Al Yasmin and Granada districts of Riyadh, with plans to expand across the city and other regions in Saudi Arabia.
With Riyadh’s fast-paced lifestyle and growing demand for digital convenience, Keemart comes at a time when convenience is no longer a luxury, it’s an expectation. Keemart offers a practical and timely solution for residents seeking quick, reliable access to groceries and household necessities. The platform not only eliminates the need for last-minute store trips but also empowers local merchants by broadening their digital footprint.
Keemart is built for everyday accessibility. Through the Keeta app, customers can browse an expanding selection of fruits, vegetables, snacks, beverages, dairy products, cleaning supplies, and personal care items. All products are sourced from trusted brands and suppliers to ensure freshness and quality.
“Our goal is simple: to make daily life easier for individuals and families across Riyadh,” said Aria Liu, Head of Keemart in Saudi Arabia. “With Keemart, we’re offering a faster, more reliable way to get everyday essentials delivered right to your door. This is part of our broader mission at Keeta to help people eat better, live better.”
Couriers are stationed at local fulfillment hubs for immediate dispatch. All frozen and temperature-sensitive items are packed with ice packs to maintain optimal quality. Deliveries are powered by a smart dispatch system and an advanced last-mile logistics network – ensuring precise, efficient, and professional service from order to doorstep.
Keemart’s growth strategy includes rapid expansion into more Riyadh neighborhoods, followed by a nationwide rollout. This initiative aligns with Keeta’s long-term vision to enhance quality of life through digital innovation while supporting Saudi Arabia’s Vision 2030 through technology, job creation, and the empowerment of local commerce.
Carrefour’s new stores will provide essential items to pilgrims, including food products, water, personal hygiene items, and other daily necessities
The stores in Mina will offer 24-hour service throughout Hajj, with a multilingual team committed to assisting pilgrims from diverse backgrounds
Riyadh, Saudi Arabia: In support of Saudi Vision 2030’s goals to enhance services for the “Guests of God” during Hajj, Majid Al Futtaim Retail, which owns the exclusive rights to operate Carrefour in the Kingdom of Saudi Arabia, announces the opening of four new pop-up stores in Mina – strategically located to serve Pilgrims during the Hajj season 1446 AH.
The stores will operate 24-hours and will provide pilgrims with convenient and easy access to essential needs offering a wide range of daily necessities, including food products, water and beverages, personal hygiene items all in proximate key locations within Mina. The stores will be managed by a multilingual team trained to assist pilgrims from diverse backgrounds which will ensure a seamless and more enjoyable shopping experience for the visitors.
Commenting on the opening of the new stores, Najib Haddad, Regional Manager of Carrefour Saudi Arabia, stated: “We are honoured to be contributing to the Kingdom’s efforts in providing exceptional services and facilitating seamless access to Pilgrims during the Hajj 1446 season. Our fully equipped stores in Mina are designed to cater to the unique needs of Pilgrims, to the highest standards – a testament to our ongoing commitment to serve with purpose the Saudi community.”
He added: “I wish to express our sincere appreciation to the Ministry of Interior, the Ministry of Commerce, and to all the relevant authorities managing this year’s distinguished Hajj season for their trust, collaboration and support. We are fully dedicated to continuously identifying purposeful opportunities to that can enhance the experience for all who visit or reside in the Kingdom.”
We are thrilled to partner with Seamless Digital Commerce 2025 as their official Interview Partner.
Seamless is the Middle East’s premier event for payments, fintech, e-commerce, retail and digital innovation.
As the official Interview Partner, BIGBOX Media Company will be on ground capturing exclusive interviews, insightful conversations and behind the scene moments, with industry leaders, innovators, and game changers who are shaping the future of digital commerce across the region.
This partnership reflects our shared commitment to storytelling, innovation, and amplifying the voices that are redefining the digital economy. Whether you’re attending in person or following the action online BIGBOX Media Company will keep you connected to the pulse of the event.
Stay tuned as we bring you the energy, insight, and innovation from Seamless Digital Commerce 2025, all through the lens of BIGBOX Media Company.
Dark stores, also known as dark shops or dotcom centers, originated in the United Kingdom in 2009, with Tesco, a leading UK supermarket chain, pioneering the model by establishing customer-free fulfillment centers.
A dark store is a retail facility that resembles a traditional outlet but is not open to the public. Instead, it functions as a dedicated space for fulfilling online orders, operating like a mini-warehouse where items are picked, packed, and dispatched for delivery. Dark stores are especially common in the grocery and rapid delivery sectors, where customers expect their purchases to arrive within hours, or even minutes.
Dark stores were introduced to meet the growing demand for fast and convenient online shopping.
According to COHERENT MARKET INSIGHTS the global dark store market is estimated to be valued at USD30.19 billion in 2025 and is expected to reach USD 296.77 billion by 2032, exhibiting a compound annual growth rate (CAGR) of 38.6% from 2025 to 2032.
Leading companies such as Swiggy Instamart, Blinkit, Zepto, and Flipkart Minutes are actively expanding their dark store networks. Meanwhile, Amazon and JioMart are also stepping into the quick commerce sector by launching their own dark store operations.
Next, we’ll explore how a dark store operates.
The dark store model is designed to streamline the fulfilment of online orders, enabling fast and efficient delivery services. Here’s how this business model typically operates:
You start by placing an order through an e-commerce platform linked to the retailer’s dark store, with available items ranging from groceries and fashion to electronics, depending on the retailer. Since dark stores are designed for storage rather than in-person shopping, they can efficiently accommodate a high volume of SKUs (stock-keeping units). Effective inventory management allows these stores to quickly locate in-stock items and allocate them for prompt order fulfilment.
After an order is received, store staff promptly pick and pack the necessary items for delivery. The store’s efficiency-focused layout enables them to work more quickly than in conventional retail stores. Once the items are packed, they are either readied for delivery or set aside for curb side pickup or click-and-collect services. Integrated technologies such as delivery tracking provide customers with real-time updates on their orders, enhancing the overall shopping experience.
Dark stores have become increasingly popular because they offer advantages to both retailers and consumers. One of the main reasons for their rise in popularity today is the rapid expansion of e-commerce. From a retailer’s perspective, dark stores help them to implement cost-efficient fulfilment processes and improve logistical operations, resulting in a quicker turnaround time for online order deliveries. On the flip side, consumers enjoy faster delivery, greater convenience through options like curb side pickup, and potentially lower prices thanks to the reduced operational costs for retailers.
With the growing popularity of dark stores, it’s clear they have a strong future. Let’s explore the key drivers behind their continued rise.
With the rapid growth of the quick commerce market, dark stores are poised to become an even more significant force in the retail landscape, particularly in urban areas and densely populated regions where demand for convenient shopping options is high. Their rise is driven by technological advancements such as automation, efficient inventory management systems, and increasing consumer expectation for fast delivery. Additionally, dark stores are expanding their product offerings beyond groceries to broaden their reach.
This rapid evolution highlights a number of benefits that make dark stores an attractive model for modern retail
Dark stores offer numerous advantages that support the evolving needs of modern retail. They enable faster order processing and delivery, essential for quick commerce and grocery fulfilment. By eliminating the costs associated with traditional retail spaces, they allow for greater investment in logistics and automation. Advanced inventory systems improve stock accuracy and availability, while technologies enhance picking precision and reduce returns. Dark stores also support scalable e-commerce operations, reduce in-store congestion, and improve customer satisfaction through flexible delivery options. Additionally, they provide a low-risk environment for experimenting with new products, helping retailers stay agile in a competitive market.
While dark stores offer significant operational and customer experience advantages, they also present a unique set of challenges that retailers must navigate to ensure long-term success.
Dark stores present several operational challenges. High upfront costs for infrastructure, automation, and software can burden smaller retailers. Efficient last-mile delivery and finding strategic urban locations add logistical complexity. Demand fluctuations and peak periods require accurate forecasting to avoid overstocking or delays. Integrating advanced technologies can be difficult, and workforce management remains critical in high volume environments. Balancing inventory, especially for perishables, adds to the complexity. Additionally, sustainability concerns around packaging and delivery are growing. Retailers must also meet rising customer expectations while navigating urban zoning laws and potential community resistance in densely populated areas.
Despite these operational hurdles, dark stores are reshaping how supply chain’s function.
Dark stores have a significant impact on the supply chain process, by enabling faster deliveries through strategic urban placement and efficient order processing. They leverage advanced inventory systems for real time tracking, reducing errors and boosting efficiency. Operating closer to customers cuts transportation and operational costs while improving last-mile delivery and the overall customer experience. Dark stores are scalable and adaptable to shifting demand, and offering retailers flexibility. They generate valuable data on customer behaviour, supporting informed decision-making. With lower setup costs compared to large distribution centres and shorter delivery routes, dark stores are both cost-effective and environmentally friendly, reducing carbon emissions and enhancing sustainability.
In conclusion, dark stores are rapidly transforming the retail and supply chain landscape, driven by the surge in e-commerce and consumer demand for fast, convenient delivery. By combining efficient fulfilment processes with advanced technologies, they offer retailers cost savings, scalability, and improved customer experiences. Despite operational challenges such as infrastructure costs and urban logistics, their benefits, especially in quick commerce, make them a compelling model for the future. As innovation in automation, inventory management, and sustainability continues, dark stores are well-positioned to become a core element of modern retail strategies, particularly in densely populated urban areas where speed and convenience are paramount.
