Deep Dive: The bright future of dark stores

Dark stores – more widely known as microdistribution hubs – have been gaining prominence in India and Southeast Asia, with grocery delivery startups like Dropezy and Zepto raising millions of dollars in funding and setting up hundreds of centers across the region.

The future of this segment is brighter than its name suggests. By 2025, India’s consumables market is projected to hit roughly US$1 trillion while Southeast Asia’s online grocery market is expected to reach US$11.9 billion – a prime opportunity for operators of dark stores.

Photo credit: Dunzo

In this episode of Deep Dive, Tech in Asia’s Nikita Puri discusses the ins and outs of this rising phenomenon, the key players leading the segment, and how dark stores can change the way we buy groceries – or anything else we might need.

Timecodes:

00:00 – Intro music
00:54 – Today’s topic: The rise of dark stores
01:08 – How dark stores work
02:22 – A Western phenomenon that’s making headway in Southeast Asia and India
03:51 – The sheer opportunity in dark stores
05:00 – What makes dark stores so special
06:36 – Are investors interested in them?
10:18 – Leading dark-store operators in the region
12:33 – Learning from old mistakes
14:30 – The tech behind dark stores
17:17 – The potential to disrupt more than just the groceries scene
19:04 – How dark stores are starting to evolve
20:10 – Will the dark-store model be sustainable in the long term?

Download the full transcript here.

Featured reporter:

• Nikita Puri, a Tech in Asia journalist based in India

Essential reading:

• Dark stores light up red-hot grocery delivery market
• Stanford dropouts’ firm bags $60m to speed up grocery delivery in India
• Indonesian e-grocery startup raises $2.5m to deliver orders in 20 minutes

Episode sponsor:

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