COVID-19

“Dark stores” fulfill online grocery orders — but for how long?

Kristin Schwab Sep 15, 2020
Heard on: Marketplace
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A Whole Foods Market in Washington, D.C. Whole Foods is one company building a new type of grocery store during the pandemic. Saul Loeb/AFP via Getty Images
COVID-19

“Dark stores” fulfill online grocery orders — but for how long?

Kristin Schwab Sep 15, 2020
A Whole Foods Market in Washington, D.C. Whole Foods is one company building a new type of grocery store during the pandemic. Saul Loeb/AFP via Getty Images
HTML EMBED:
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Groceries were already moving online before the pandemic, and now it’s become a major focus in the industry.

Walmart launched its new delivery subscription program Tuesday called Walmart Plus, which includes groceries. More stores have joined Instacart, and other apps like DoorDash have added groceries onto their services.

Now, companies like Whole Foods and Stop & Shop are building a new type of store called a dark store. It looks like a regular grocery store — aisles of produce and pasta, without fancy cheese towers or end-of-aisle displays.

“It doesn’t have to look pretty because consumers are not going to be in the store, right?” said Doug Baker of FMI, a food industry association. Dark stores aren’t open to customers. They’re for fulfilling online orders, which have surged during the pandemic.

And building them like regular markets — not warehouses — means they can be converted into stores if the trend doesn’t hold.

“You can build something for today, but you also need to think about what’s the future,” Baker said.

Part of the reason the future is unclear is not everyone is online ordering experiences have been stellar.

“This integration of the online with the physical carried along with it some very unique problems,” said Terry Esper, professor of marketing and logistics at Ohio State University.

For instance, maybe you order a specific cheese, and you’re sent a substitute that’s $5 more. Or maybe you can’t get a delivery slot.

And for people who live outside a delivery zone, don’t have reliable internet or are receiving federal benefits for food, online grocery shopping may not be an option.

“I think we shouldn’t underestimate the human desire to engage in grocery shopping,” said Hart Posen, a professor at the University of Wisconsin-Madison. He thinks shoppers will eventually settle into a mix of in-store and online, because the online stores don’t let you pick the ripeness of your fruit. And they definitely lack free samples.

COVID-19 Economy FAQs

With a slow vaccine rollout so far, how has the government changed its approach?

On Tuesday, Jan. 12, Health and Human Services Secretary Alex Azar announced changes to how the federal government is distributing vaccine doses. The CDC has expanded coronavirus vaccine eligibility to everyone 65 and older, along with people with conditions that might raise their risks of complications from COVID-19. The new approach also looks to reward those states that are the most efficient by giving them more doses, but critics say that won’t address underlying problems some states are having with vaccine rollout.

What kind of help can small businesses get right now?

A new round of Paycheck Protection Program loans recently became available for pandemic-ravaged businesses. These loans don’t have to be paid back if rules are met. Right now, loans are open for first-time applicants. And the application has to go through community banking organizations — no big banks, for now, at least. This rollout is designed to help business owners who couldn’t get a PPP loan before.

What does the hiring situation in the U.S. look like as we enter the new year?

New data on job openings and postings provide a glimpse of what to expect in the job market in the coming weeks and months. This time of year typically sees a spike in hiring and job-search activity, says Jill Chapman with Insperity, a recruiting services firm. But that kind of optimistic planning for the future isn’t really the vibe these days. Job postings have been lagging on the job search site Indeed. Listings were down about 11% in December compared to a year earlier.

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