The formula allows entrepreneurs to spend less on rent, maintenance, and refurbishing their physical premises.
What are dark stores? Warehouses that thrive in the dark: no employees, no flashy shelves, and no space for face-to-face commerce.
This type of venture, driven by changes in consumer habits and e-commerce, has been very popular during the months of the pandemic.
Everything, in a way, is for the better. And, in the midst of the current global crisis, dark stores have become a very popular type of entrepreneurship born out of the pandemic.
These are warehouses that deliver products to homes. So customers no longer have to physically go to the store to make their purchases.
The formula allows entrepreneurs to save on rent, maintenance, and remodeling their physical premises.
Nor do they pay salaries since they don’t have floor employees, special operating permits, or security systems.
Mireya Ortiz, founder of Pedalea Libre, a vegan dark kitchen located in the northern part of Mexico City, has experienced this firsthand.
She’s faced the difficulties and economic challenges arising from changing customer habits during the pandemic.
“At some point, I thought about setting up a restaurant, but sales were down 80% until two months ago. If I’d invested in a place, I wouldn’t have been able to sustain it,” she said in an interview with TecReview.
Her main clients were office workers, but since the home office style began to dominate, sales fell to such a degree that she also had to lay off staff from her dark kitchen. She simply couldn’t balance the books.
“I was burned out (exhausted from work), which led me to take two months off from the business, and I started it back up about 3 weeks ago; I’m now relaunching. But the idea of opening new premises right now isn’t viable,” says Ortiz.
The name of her business is Pedalea Libre because it alludes to cyclists pedaling to deliver culinary creations free of ingredients of animal origin, hence the singular combination of the verb with the adjective.
Mireya doesn’t have her business registered with a food delivery platform, such as Uber Eats or Rappi, but she does use WhatsApp Business to stay in touch with her customers.
“It still doesn’t have a direct payment facility, but I think it’s a free tool that allows me to continue generating an injection of cash.”
This entrepreneur, who graduated in chemical engineering from the National Polytechnic Institute, predicts that Pedalea Libre will eventually rebound, although it will surely take six months to return to pre-pandemic sales levels.
2020 was a complex and surprisingly favorable year for online businesses according to Josu Gurtubay, founder of Cubbo, a company specializing in turning physical stores into dark stores.
“E-commerce exploded in the context of the pandemic, growing 66% in Latin America and 80% in Mexico. But we still have a long way to go. Online commerce market penetration in Mexico only accounts for 9% of retail sales,” he says in an interview with TecReview.
Ver esta publicación en Instagram
This means that out of every 9 pesos sold in online stores, 91 pesos are still sold in physical stores whereas in China, digital commerce penetration has reached 50% as compared to traditional businesses.
Josu, who is a graduate in mechatronics engineering from the Tec de Monterrey, Mexico State campus, says that it’s not a question of fomenting antagonism between digital and traditional commerce but of moving toward what he calls “omnichannel commerce.”
“That’s the strategy; it isn’t one or the other, but both. The idea is for both digital and physical channels to coexist thereby providing the customer with a good experience. It’s called omnichannel, and it is a complex endeavor.”
So, the idea is that if, for example, someone buys a product on a large department store’s website, they don’t necessarily receive it at home, but they can also pick it up at the business’s physical premises.
In this way, customers take advantage of both types of commerce and diversify their shopping experience as best suits their needs.
This point of view is supported by Alejandro Caballero, director of Marketplace Soft at Mercado Libre Mexico. In an interview with TecReview, Alejandro explained that his mission is to provide entrepreneurs with the option of taking their businesses beyond a purely physical presence by getting involved in omnichannel commerce.
“We’re giving companies the opportunity to extend their reach. Today, a craftsman from Oaxaca doesn’t only sell to the customer who visits his physical store, but his product has millions of potential buyers online throughout the country, like a large store window.”
Since 2020, more than 500 brands in Mexico have joined Mercado Libre as official stores. That is, they have also opted for a strategy analogous to that of dark stores: supplying customers from warehouses through online commerce.
“Companies such as Nike, Reebok, Adidas, Marti, C&A, GNC, L’occitane, Sexy JNS, Kipling, and Bridgestone have joined our platform. Similarly, more than 8,000 SMEs (small and medium-sized enterprises) have begun to sell their products through us,” adds Caballero.