What are dark stores?

 

Despite their slightly sinister name, dark stores are harmless and not linked to the darknet. In fact, the term "dark store" refers to a warehouse or logistics center that’s laid out similarly to a supermarket. However, a dark store’s main aim is for employees to fulfil online orders and is not open to consumers.

 

 

The rise of dark stores

With the increasing popularity of e-Commerce, it’s no wonder that the number of dark stores is also on the rise. The size of the global dark store market was $23.33 billion in 2024. The market is projected to reach $32.91 billion in 2025, with a rather significant jump to $128.78 billion by 2029. This corresponds to an impressive 40.7% compound annual growth rate (CAGR).

 

The main driver behind this growth is the grocery, food, and beverages sector, which is increasingly popular amongst e-Commerce orders. Customers can choose between home deliveries and curbside or in-store pickups, with the former option being the more popular. While dark stores are used all over the world, North America is the market leader in this segment with a 35% market share. Quick commerce (which refers to same-day or even faster deliveries) is another significant contributor to the rise of dark stores.

 

Find out all about quick commerce!

 

 

Why use dark stores

When fulfilling online orders, dark stores have several advantages over both real supermarkets and warehouses. Many of these advantages have to do with speed and convenience.

 

The interior of supermarkets is designed to encourage customers to linger and probably buy more than they originally set out to do. This layout doesn’t favor speed, which is why dark stores are organized in a way to help employees pick products as fast as possible.

 

 

Image of a warehouse storing groceries

 

 

Research suggests that it’s 40% faster to pick products from the shelves of a dark store than those of a consumer-oriented supermarket. Businesses can thus enjoy maximum efficiency and improved distribution, while customers can expect faster service.

 

Operators of dark stores have a wider reach and a broader audience than those with active supermarkets. Since these stores are often located in residential neighborhoods and not large remote warehouses, customers can expect faster deliveries.

 

| Picking products from a dark store is 40% faster than from a consumer supermarket

 

Also, as dark stores are geared towards effective storage and stock unit management (SKU), operators usually find it easier to handle sensitive products such as perishables. This also contributes to improved inventory management and consequently to a larger array of stocked products.

 

All in all, dark stores can contribute to streamlining operating costs, increasing scalability and flexibility, improving inventory management, speeding up order fulfillment as well as deliveries, and ultimately enhancing customer satisfaction.

 

 

Related topics

The rise of Quick Commerce

 

The importance of a great online shopping experience

 

International e-Commerce expansion and brand protection

 

 

The top 3 companies working with dark stores

As an increasing number of e-Commerce companies opt for dark stores, let’s take a look at three of the best-known and/or most successful brands that do so.

 

 

Walmart

US-based retail chain Walmart doesn’t shy away from the latest developments. While originally a chain of only brick-and-mortar stores, Walmart embraced e-Commerce and added online shopping to its business activities.

 

Now, with quick commerce on the rise, Walmart’s strategy is to convert a few of its traditional supermarkets to dark stores. The first two of such stores have started operations in Dallas (Texas) and Bentonville (Arkansas). Once the company has enough data from this pilot project, Walmart will evaluate whether it’s worth it to convert more supermarkets into dark stores.

 

 

Screenshot https://www.walmart.com/cp/get-it-fast/6545138 of advertising Walmart’s quick commerce service

 

 

Amazon

As a primarily e-Commerce-oriented company, Amazon has chosen a different strategy. In addition to its traditional large warehouses in remote locations, the e-Commerce giant has started experimenting with smaller dark stores in residential neighborhoods to improve delivery times and widen its scope. The strategy is so successful that Amazon is currently ranked first among the top 10 most important businesses in this market segment.

 

 

Target

A chain similar to Walmart, Target is also experimenting with converting some of its physical locations to dark stores. However, Target uses a hybrid approach, which means that only some parts of a store are restricted to consumers and dedicated to online order fulfillment. Shoppers are free to visit other parts of the same store that still operate as a traditional hypermarket.

 

Converting only parts of a store creates a "best of both worlds" situation where consumers still get to visit a popular shopping location while the business improves its online fulfillment services.

 

 

Dark stores vs online brand protection

Besides their advantages, dark stores also pose challenges for businesses, especially when it comes to the protection of their IP rights.

 

As dark stores tend to be operated by online retailers, they come with all the built-in risks associated with third-party sellers. For example, your products are exposed to an increased online presence that’s completely out of your control. In addition, depending on the IP protection measures of the operator, you may even face the risk of counterfeit or grey market products, which could cause severe reputational harm for your brand.

 

Another issue that could damage your reputation even more is whether the dark store operators comply with relevant legislation. As reports about food safety violations in dark stores emerged, brands whose products were affected by the scandal had to take quick action to control the damage.

 

But damage control is always less effective than prevention, which is where online brand protection comes in.

 

 

Online brand protection measures for dark stores

globaleyez’s comprehensive services provide your business with flexible, fully scalable solutions for all your brand protection needs.

 

Our online monitoring services detect potentially infringing content, including product listings, social media posts, ads, images, entire webshops, etc. This is especially important for monitoring dark stores, as their restricted access doesn’t allow for the natural scrutiny that comes with in-person shopping.

 

Once we identify the infringing content, we enforce your rights and demand its removal from the internet.

 

Intransparent and defective distribution networks are amongst the main sources of grey market operations. Our partner compliance service discreetly checks whether your business partners are adhering to their contracts, giving you full transparency and control over your distribution network.

 

Our efforts ensure that infringing product listings are quickly detected and removed from e-Commerce platforms, which in turn creates a clean marketplace where your original, authorized product listings can shine.

 

Finally, you may want to seek legal retribution against fraudsters who harmed your business. We are happy to assist you with preparing your case, e.g., by collecting court-admissible evidence and providing you with extensive information about the perpetrators via thorough OSINT research.

 

 

Conclusion

With the rising popularity of online grocery shopping, the number of dark stores can also be expected to increase. Whether this concept is beneficial for you depends on the nature of your products and your brand image.

 

However, regardless of the strategy you choose, it’s important to bear in mind that online commerce poses several risks for your IP rights. Don’t let fraudsters infringe on them; instead, get in touch with us and let’s talk about how to solve the challenges your IP rights face.