Supermarket Countdown is preparing to open its first "dark store" to service growing demand for online shopping.
The large 8800 sqm dark store will house all the usual supermarket supplies - around 27,000 products - but will not be accessible for shoppers. The closed store based in Penrose will be used as a warehouse to service online orders from 10 of Countdown's Auckland stores, and will employ a team of 165 personal shoppers dedicated to serve what Countdown says are "thousands of online delivery customers".
E-stores, or "dark stores" as they are often referred to within the industry, are commonplace in Britain and United States where the uptake in online shopping is far greater than it is in New Zealand.
New Zealanders spent about $4.2 billion online last year - the equivalent of 8.9 per cent of all retail sales.
Countdown's Auckland-based fulfilment store will open in April and is said to be the first of its kind in this country. It will introduce partially-automated fulfilment in partnership with Takeoff Technologies, the supermarket says.
Online sales account for 6.5 per cent of parent company Woolworth's total NZ sales.
In the first quarter of the 2020 financial year, the supermarket posted online sales revenue of $149 million, a 38 per cent increase on the same time a year earlier.
Countdown general manager of digital, Sally Copland, said an increasing number of Kiwis were shopping online with the supermarket each week, and the shopping method had taken-off in recent years, she said.
"At Countdown we've seen massive demand for our online shopping services over the last few years - in the last quarter alone we've had 38 per cent growth," Copland said.
"[The] eStore will enable us to improve our customer experience for online shoppers as well as free-up space in-store and improve the experience for our team.
"It will also allow us to really accelerate the speed at which we can make online orders available for our customers, with more same-day ordering and delivery windows. That's what today's online shoppers are telling us they need."
Boston-based Takeoff Technologies is an e-commerce grocery start-up that builds compact and automated micro fulfilment centres.
Copland said Countdown saw the future of grocery shopping as "a mix of services that are fundamentally focused on meeting our customers' needs and expectations, and importantly, their lifestyle".
Dark stores are highly automated supermarkets - without customers - dedicated to service online grocery shopping. Woolworth's already operates three dark stores in Australia, one in Melbourne and two in Sydney, to serve online orders.
Retail analyst Chris Wilkinson last year told the Herald that the country was yet to see the uptake in online shopping needed to service such stores, but said with time supermarkets would introduce the distribution centres.
Countdown was the first supermarket to offer online grocery shopping in this country. It began trialling online shopping more than 20 years ago.
Copland told the Herald online shopping was growing at a "phenomenal rate" across the country and was analysing its store network strategy. She said further dark stores would open if demand for online orders for delivery continued.
"We're re-thinking the network and working out what's the most efficient way to pack the orders. Part of the reason we're [opening a dark store] in Auckland is because we have reached the capacity of packing in our stores.
"The world of retailing is going to continue to change very quickly in this space."
The fulfilment store was a significant investment and cost millions of dollars to set up, Copland said. "We're commissioning a whole new operating model and will be putting in a large amount of equipment into that fulfilment."