Woolworths’ has introduced its first dark store to support its on-demand delivery service — Woolies Dash — located in Cape Town’s CBD.
A dark store isn’t open to the public and is dedicated to fulfilling online orders. Woolworths’ first dark store is servicing the city bowl and surrounding areas.
Woolworths online and mobile director Liz Hilock said their investment in dark stores would help improve their customers’ experience.
Woolworths said the Cape Town dark store has markedly impacted product availability for online orders in the area.
It added that Woolies Dash orders are typically fulfilled through local Woolworths stores, meaning online orders compete with in-store shoppers.
“The dark store eliminates this competition, and customers enjoy quicker delivery, thanks to a dedicated environment designed to be online-first,” says Woolworths.
It added that it plans to roll out more Woolies Dash dark stores across the country in the near future.
The on-demand delivery service reported strong growth for the financial year ended 30 June 2024.
Despite the retailer facing several trading obstacles in the year, most of its business assets saw significant online growth.
Online food sales grew by 52.8%, contributing 5.5% of Woolworths’ total sales in South Africa.
The retailer attributed the growth to increased penetration of the Woolies Dash service, which grew by 71.2% over the period.
The company also observed a significant increase in online sales in its fashion, beauty, and home business. These sales increased by 30.4% and contributed 5.6% of total sales.
However, it noted that it faced some challenges that negatively impacted trade, including the popularity of players like Shein and Temu in South Africa.
“Whilst our Fashion, Beauty, and Home business continues to make steady progress on a number of its strategic priorities, trade was impacted by the weak macro environment, poor availability, and increased competition from the disruptive entry of international online retailers,” Woolworths said.
Despite these challenges, Woolworths says it consistently sees sales growing by over 50% in food and beauty, home, and fashion.
