Countdown planning new grocery store concept. But there will be no customers!
Bonnie Flaws @ stuff.co.nz
Countdown will open the country's first dedicated online store in Auckland in response to the rapid growth in online delivery sales. Inside, the store would look similar to a regular supermarket, but bigger and without the normal shop-fit out. It would have a produce area, a bakery and deli, grocery aisles and a chilled food section. But there would be no customers.
Countdown digital general manager Sally Copland said the store, which was under construction in Penrose, would open in April. The centre, would fulfil online delivery orders for Mt Wellington, St Johns, Three Kings, Ponsonby, Mt Eden, Grey Lynn Central, Botany, Manukau City Mall, Meadowlands and Manurewa, Copland said.
Orders for pick up will continue to be run from local supermarkets. The move would improve the speed, accuracy and efficiency of service for the customer, Copland said. Customer expectations were changing rapidly, she said
“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”
The fulfilment centre, also known as dark stores or "shadow warehouses", would improve the online shopping service and would free-up space in the supermarkets, she said.
Senior Lecturer in marketing at Massey University Andrew Murphy said the amount spent online on grocery in New Zealand was only around 3 per cent to 4 per cent, but was growing quickly at 18 per cent a year.
'Whenever you're looking at increases of 10 or 20 per cent per annum it does present issues about how you grow infrastructure," he said.
It also meant the market was now large enough to try the model out, which would not have been possible before, he said.
The centre would employ 165 staff, stock 27,000 items and would be partially automated, Copland said. The centre would use automation technology from United States firm Takeoff Technologies. It works by bringing items to staff, rather than having pickers walking up and down aisles to locate products. Whether fulfilment centres would be built in other parts of the country was yet to be decided, Copland said. The supermarket needed to fully understand the technology and how shoppers responded before deciding how it could be used elsewhere, she said.
“We always talk about getting a perfect order. You will increasingly see an evolution of how orders are picked right across the country”
Countdown's Australian owner Woolworths has three dedicated online stores that Countdown could learn from, she said. Food and drink was one of the last categories to move online and changing the habits and routines of the weekly shop meant creating a high level of trust that orders would be right.
"That's a real focus for us. Once customers understand the convenience it can give them, things change," Copland said.
Murray said due to the small population there was probably a limit to the number of dark stores a country like New Zealand would support. "Generally speaking this works in urban areas, it's not going to work anywhere else."
The market for online sales was more mature in the United Kingdom and the levels of automation in supply chains were more advanced. The average consumer spend was also greater and dark stores could therefore scale more easily, he said. Copland said Countdown uses a fleet of 199 vehicles for deliveries around the country Just three of them were electric vehicles, with two more on the way.
No redundancies were expected as a result of the new fulfilment centre, she said.
