Woolworths Group (ASX:WOW) - CEO, Bradford Banducci - The Market Herald
CEO, Bradford Banducci
Source: Herald Sun
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  • A new Woolworths (WOW) location is slated to open in Queensland this December, but you can't walk its aisles
  • The location will strictly be a 'dark store' — only packing and sending out online deliveries
  • An uptake in online shopping supports the $85 million venture
  • Last year, from July to December, Woolworths' online sales were boosted by 92 per cent
  • The new location is set to create hundreds of new jobs
  • Shares in the company fell 1.68 per cent during Wednesday trade, closing for $39.82 apiece

A Woolworths (WOW) location that spans 10,000-square-metres will open in Queensland this December, but you can't enter the building.

Commonly known as a 'dark store', the Woolworths outlet won't let shoppers walk the aisles, but instead only pack orders for delivery.

Woolworths Company General Manager Tamara Manasserian says the Rochedale location will accommodate hundreds of new job opportunities.

New jobs at the centre include management, transport, and general operation roles.

"It's a great example of retail innovation driving jobs growth in Queensland," she said.

An additional 200 jobs will be created through the centre's $85 million development alone.

Shopper behaviour throughout COVID-19 lockdowns and isolation only supports the venture.

Last year between July and December, Woolworths' online sales climbed by 92 per cent. In Victoria alone, a state that has undergone the most strenuous lockdowns, online sales more than doubled in 2020.

The company now says 8 per cent of its total sales are from online transactions. This new dark store will offer nearly 20,000 different products.

Woolworths is also investing $110 million into another dark store in Sydney's west.

A mock rendering of the Queensland location.
Source: Woolworths

This isn't a new invention by Woolworths, either. Dark stores have popped up in the hospitality industry before.

Noticing the volume of sales through delivery apps such as Uber Eats and Deliveroo, some restaurants opt to cut costs on staff by operating as a 'dark kitchen' — only meeting orders through online delivery.

In the broader retail sector, Amazon houses its own distribution centre in Brisbane, pivoting almost entirely on internet shopping and swift delivery.

Cashless innovation gets its card declined

As Woolworths pushes for innovative measures, not all of them have been successful.

Recently the supermarket king had to put the pin on a 'card only' trial that proved to be divisive.

In June last year, Woolworths attempted to phase out coins and cash in stores across Melbourne, Brisbane, and Sydney.

This decision was made to accommodate for the more speedy shoppers located in metropolitan areas — those who rather tap-and-go payments.

The trial was later shut down this year, as demonstrated by the negative feedback published to social media. It seemed shoppers didn't appreciate losing the option to pay the old fashioned way.

Many were angry enough to boycott or threaten to take their business elsewhere.

"While almost all Metro customers choose to pay with cards, cash remains incredibly important to those who don’t for a whole range of reasons we didn’t fully appreciate,” Woolworths Metro General Manager, Justin Nolan, said.

"Based on feedback from our customers, we can see we’ve moved ahead of current community expectations on cash and will be ending the trial".

Shares in Woolworths fell 1.68 per cent during Wednesday trade, closing for $39.82 apiece.

WOW by the numbers
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