China Watch: Self-Serve Convenience Stores

Posted by Thomas Andersson on

Whatever Amazon does, China can do much better... seems to be the going mantra.

No sooner had Amazon announced its cashier-free concept - Amazon Go - before Chinese operators already had a working concept in the pipeline with funding ready to go.

In 2017 Xiaomai released its 4th generation of its self-contained cashier-less self-serve convenience stores each stocking more than 600 of the most popular items.

Xiaomai Convenience Store
Source: Xiaomai

Xiaomai appears to be a partnership between several companies providing expertise in facial recognition, property, etc. The company itself is well funded and raised $3.8bn (CYN25bn) in July 2017 (Crunchbase).

The company has opened 12 locations at the moment. Based on the image above we presume its stores are more akin to pre-built pop-up stores based on a 'container concept' as popularised by Boxpark in the UK and Artbox in Thailand. The difference being that XIaomai's stores are located in isolation.

Customers scan bar codes on items using Tencent’s Chinese messaging app WeChat before paying with WeChat Wallet.

The main reason for shopping in a self-serve environment appears to be a preference for avoiding badly trained staff.

“Sometimes when you are in a bad mood, you just want to be able to get in and out without any hassle,” (FT.com, $$)

Despite its huge funding round, the company appears to be relatively early stage with its mobile stores adapted to experimentation and prospecting of the best or most suitable locations.

China is a fertile ground for experimenting with new concepts

China has a definite advantage on any Western competitor with its access to a large audience of consumers willing to have all their data managed by companies, possibly as a result of its government structure. The idea of privacy protection is not a major concern.

Ecommerce giant JD.com is the latest to branch into automation, announcing a tie-up last week with Hong Kong-listed developer China Overseas Land & Investment to build hundreds of self-serve convenience stores and 1,500 medicine dispensers across China. In so doing, JD.com is chasing competitors such as Alibaba that are developing their own cashier-less outlets. Rising labour costs and high turnover among blue-collar jobs has price sensitive online retailers looking to apply logistics and online payment systems to automate shopping. (FT.com, $$)


Share this post



← Older Post Newer Post →


Leave a comment

Please note, comments must be approved before they are published.