diff --git a/core/java/android/os/Environment.java b/core/java/android/os/Environment.java
index 4616af8f77689..8d9ceb6ac58ce 100644
--- a/core/java/android/os/Environment.java
+++ b/core/java/android/os/Environment.java
@@ -379,6 +379,24 @@ public class Environment {
         return new File(getDataPreloadsDirectory(), "media");
     }
 
+    /**
+     * Returns location of preloaded cache directory for package name
+     * @see #getDataPreloadsDirectory()
+     * {@hide}
+     */
+    public static File getDataPreloadsFileCacheDirectory(String packageName) {
+        return new File(getDataPreloadsFileCacheDirectory(), packageName);
+    }
+
+    /**
+     * Returns location of preloaded cache directory.
+     * @see #getDataPreloadsDirectory()
+     * {@hide}
+     */
+    public static File getDataPreloadsFileCacheDirectory() {
+        return new File(getDataPreloadsDirectory(), "file_cache");
+    }
+
     /**
      * Return the primary shared/external storage directory. This directory may
      * not currently be accessible if it has been mounted by the user on their
diff --git a/services/retaildemo/java/com/android/server/retaildemo/RetailDemoModeService.java b/services/retaildemo/java/com/android/server/retaildemo/RetailDemoModeService.java
index af19acb133f7b..f89fd47df4e65 100644
--- a/services/retaildemo/java/com/android/server/retaildemo/RetailDemoModeService.java
+++ b/services/retaildemo/java/com/android/server/retaildemo/RetailDemoModeService.java
@@ -254,12 +254,9 @@ public class RetailDemoModeService extends SystemService {
                     mInjector.systemPropertiesSet(SYSTEM_PROPERTY_RETAIL_DEMO_ENABLED, "0");
 
                     // Run on the bg thread to not block the fg thread
-                    BackgroundThread.getHandler().post(new Runnable() {
-                        @Override
-                        public void run() {
-                            if (!deletePreloadsFolderContents()) {
-                                Slog.w(TAG, "Failed to delete preloads folder contents");
-                            }
+                    BackgroundThread.getHandler().post(() -> {
+                        if (!deletePreloadsFolderContents()) {
+                            Slog.w(TAG, "Failed to delete preloads folder contents");
                         }
                     });
 
@@ -443,8 +440,29 @@ public class RetailDemoModeService extends SystemService {
 
     private boolean deletePreloadsFolderContents() {
         final File dir = mInjector.getDataPreloadsDirectory();
+        final File[] files = FileUtils.listFilesOrEmpty(dir);
+        final File fileCacheDirectory = mInjector.getDataPreloadsFileCacheDirectory();
         Slog.i(TAG, "Deleting contents of " + dir);
-        return FileUtils.deleteContents(dir);
+        boolean success = true;
+        for (File file : files) {
+            if (file.isFile()) {
+                if (!file.delete()) {
+                    success = false;
+                    Slog.w(TAG, "Cannot delete file " + file);
+                }
+            } else {
+                // Do not remove file_cache dir
+                if (!file.equals(fileCacheDirectory)) {
+                    if (!FileUtils.deleteContentsAndDir(file)) {
+                        success = false;
+                        Slog.w(TAG, "Cannot delete dir and its content " + file);
+                    }
+                } else {
+                    Slog.i(TAG, "Skipping directory with file cache " + file);
+                }
+            }
+        }
+        return success;
     }
 
     private void registerBroadcastReceiver() {
@@ -818,6 +836,10 @@ public class RetailDemoModeService extends SystemService {
             return Environment.getDataPreloadsDirectory();
         }
 
+        File getDataPreloadsFileCacheDirectory() {
+            return Environment.getDataPreloadsFileCacheDirectory();
+        }
+
         void publishLocalService(RetailDemoModeService service,
                 RetailDemoModeServiceInternal localService) {
             service.publishLocalService(RetailDemoModeServiceInternal.class, localService);
diff --git a/services/tests/servicestests/src/com/android/server/retaildemo/RetailDemoModeServiceTest.java b/services/tests/servicestests/src/com/android/server/retaildemo/RetailDemoModeServiceTest.java
index d53fdf6c4aa94..e1dda5198a360 100644
--- a/services/tests/servicestests/src/com/android/server/retaildemo/RetailDemoModeServiceTest.java
+++ b/services/tests/servicestests/src/com/android/server/retaildemo/RetailDemoModeServiceTest.java
@@ -448,6 +448,11 @@ public class RetailDemoModeServiceTest {
             return mTestPreloadsDir;
         }
 
+        @Override
+        File getDataPreloadsFileCacheDirectory() {
+            return new File(mTestPreloadsDir, "file_cache");
+        }
+
         @Override
         void publishLocalService(RetailDemoModeService service,
                 RetailDemoModeServiceInternal localService) {