How Retailers Are Maintaining Vacant Locations Closed Due to the Pandemic

Dark stores are retail locations that have closed for various reasons, mostly due to low profitability and foot traffic, and they have been increasing in number since 2019.

The concept of “dark stores” allows retailers to adjust their real estate strategy and close under-performing locations rapidly. However, retailers face a unique set of challenges when maintaining dark stores and mitigating the impact to their brand.

Challenges for Retailers

Dark stores typically do not have employees or other contractors to continue regular maintenance tasks and meet operational standards. This lack of monitoring exposes the retailer to additional reactive maintenance costs, ranging from minor repairs to major damage, such as flooding sinks or a leaking roof. Facility managers with large portfolios typically focus on their portfolio of operating stores, leaving little time to address dark store maintenance.

Without routine visits, non-critical issues become critical, increasing maintenance spend. Gary Schluter, Director of Facilities at Aaron’s, the national rent-to-own furniture, electronics and appliances retail chain, implemented a dark store survey program that led to a reactive spend decrease of 15% in a portfolio of 188 dark stores. The survey program included monthly site visits, utilizing technology to assess key facility asset and location conditions for both interiors and exteriors. Through the program, the dark sites were maintained through frequent oversight by certified providers, and the facility managers were able to focus on the open locations.

Without a survey program in place, vacant stores are at risk of the following:

• Theft
• Vandalism
• Local city/county violations
• Failure to maintain brand standards
• Unwanted utility spend

Retailers should strive to implement an accountable solution that is low touch for the store operations team. When adding dark stores to their portfolio, retailers can follow a few best practices.

Best practices for managing dark stores:

• Monthly visual site inspection
• Inspection report with imagery to show status
• Work order automation
• Detailed review of non-critical issues

Take This with You

Dark store numbers may be increasing, but reactive spend does not need to increase with them. Assessing portfolios and defining a survey program will help to maintain dark stores profitably by protecting the property, maintaining the assets and providing the time for facility managers to focus attention where it’s needed most: strategizing repairs.