Sainsbury's To Open First Dark Store In South East London

Supermarket Sainsbury's plans to open its first online-only delivery warehouse as it expands its billion pound grocery delivery business.

The so-called 'dark' store will be built in Bromley-By-Bow - just five miles east of Sainsbury's head office in Central London - and open in the next few years. The facility will cover 185,000 square feet and serve 20,000 customers a week.

Jon Rudoe, Sainsbury’s director of online, digital and cross-channel, told the Daily Telegraph: 'The site will be purpose-built with the Sainsbury’s customer in mind and will support our existing store-based operation, something that will continue to be the foundation of our online grocery business.'

Sainsbury's revealed earlier this month that its food delivery business turnover had reached £1 billion on a 12 month rolling basis. It fulfills 190,000 orders a week.

Tesco, Asda and Waitrose have all opened dedicated online delivery warehouses. Tesco is due to open its sixth this month, Waitrose has one with plans for a second, both in London, and Asda has three in Leeds, Enfield in North London, and Nottingham.

But Sainsbury's management has historically appeared dismissive of dark stores arguing that it is more cost effective to make store picking more efficient rather than set about creating costly, dedicated centres.

Chief executive Justin King was quizzed on the subject by analysts during the firm's second quarter results conference call just two weeks ago and appeared to have changed his tune. He said: 'Dark stores will come, I don’t think that that’s in debate, and as we’ve seen from our competitors the capacity constraint for them will be the same for us, it will be in the southeast.'

But he also made an effort to play down expectations that any strategy was urgently needed: 'The progress that we’ve made over the last two or three years, both in the layout of our stores but also in the timing and approach of our picking operations, means that we remain confident we’ve got capacity growth there. The key balance in an in-store pick is that you don’t want it to interfere with the in-store experience for real customers in the store.'

He continued: 'Our first focus is to invest on productivity in our existing operations, and we continue to exceed our own expectations of what’s possible from a store pick operation, both in terms of the productivity of that operation, but also in terms of the capacity.'

The Bromley-By-Bow warehouse will employ 375 people when it opens.