---
title: "Can Unmanned Retail Seize the Opportunity to 'Turn the Tables' After the Pandemic?"
description: "Unmanned retail faces challenges in finding suitable locations and meeting appropriate scenarios. Since the outbreak of the pandemic, besides mainstream channels like offline supermarkets and fresh food e-commerce, unmanned retail has become one of the purchasing channels for daily necessities. Recently, after the completion of Huoshenshan Hospital, an unmanned supermarket in the epidemic area was launched, built by Alibaba's Taoxianda and Hubei chain supermarket Zhongbai Warehouse, operating 24 hours a day and serving over 200 customers on its first day. Luckin's unmanned coffee machine 'Ruijigou' has also entered multiple hospitals in Wuhan. During the fight against the epidemic, unmanned supermarkets, unmanned delivery, and unmanned cabinets have become particularly important."
author: "操秀英"
publisher: "New Distribution"
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published: "2020-03-04"
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# Can Unmanned Retail Seize the Opportunity to 'Turn the Tables' After the Pandemic?

> Unmanned retail faces challenges in finding suitable locations and meeting appropriate scenarios. Since the outbreak of the pandemic, besides mainstream channels like offline supermarkets and fresh food e-commerce, unmanned retail has become one of the purchasing channels for daily necessities. Recently, after the completion of Huoshenshan Hospital, an unmanned supermarket in the epidemic area was launched, built by Alibaba's Taoxianda and Hubei chain supermarket Zhongbai Warehouse, operating 24 hours a day and serving over 200 customers on its first day. Luckin's unmanned coffee machine 'Ruijigou' has also entered multiple hospitals in Wuhan. During the fight against the epidemic, unmanned supermarkets, unmanned delivery, and unmanned cabinets have become particularly important.

**Unmanned retail is difficult in finding the right location and meeting the right scenario.**
Since the outbreak of the pandemic, besides mainstream channels such as offline supermarkets and fresh food e-commerce, unmanned retail has also become one of the purchasing channels for daily necessities.
Not long ago, after the completion and delivery of Huoshenshan Hospital, an unmanned supermarket in the epidemic area was launched, built by Alibaba's Taoxianda and Hubei chain supermarket Zhongbai Warehouse. The supermarket operates 24 hours a day and served over 200 customers on its first day. Luckin's unmanned coffee machine 'Ruijigou' has also entered multiple hospitals in Wuhan. **During the fight against the epidemic, unmanned supermarkets, unmanned delivery, and unmanned cabinets have become particularly important.**
In fact, unmanned retail was once very hot a few years ago, but within a short period, it experienced a rapid rise, a crash, and then a quiet undercurrent. What are the reasons for this? Where will unmanned retail go in the future?
**-01-
****The former glory began in 2017**
When the cost of acquiring traffic online became increasingly high and development almost hit the ceiling, in 2016, Amazon opened its first unmanned experience store, Amazon Go, pioneering the industry. Subsequently, domestic merchants quickly followed suit.
In 2017, the concept of new retail emerged. Although everyone interpreted it differently, **unmanned retail, due to the application of cutting-edge technologies such as artificial intelligence and big data, as well as the gradual improvement of mobile payment and supporting facilities, quickly gained high expectations from the market and capital.**
One day in May 2017, at the entrance of Auchan's Shanghai Yangpu store and its China headquarters, an unmanned convenience store was quietly set up. This store, resembling a container, had a trendy and internet-like name—Bingo Box. From then on, the curtain of unmanned retail was officially lifted.
At the end of June that year, Bingo Box announced it had secured over 100 million yuan in Series A funding. Its CEO Chen Zilin told the media about his business strategy and future goals, saying he would complete the deployment of 5,000 outlets within a year.
His bold words indeed further stimulated the sensitive nerves of entrepreneurs, and various unmanned convenience stores opened even more aggressively. In October 2017, JD.com opened its first unmanned supermarket, using facial recognition and radio frequency identification (later transitioning to camera + sensor recognition) technology to achieve fully unmanned shopping without intervention.
At the same time, another form of unmanned retail—unmanned shelves—also developed rapidly. In June 2017, the later star startups Guoxiaomei and Xingbianli were officially launched. Guoxiaomei received investment from IDG in its angel round, and Xingbianli's Series A was led by Sequoia Capital.
According to IT Juzi statistics, in 2017, 93 unmanned retail events received financing, accounting for more than half of the total investment events in the new retail sector that year. But no one expected that in just over a year, the companies once favored by capital would fall like dominoes.
Starting from early 2018, star companies such as Guoxiaomei, Xingbianli, GOGO Supermarket, Qizhi Kaola, and Bingo Box were successively exposed to losses, layoffs, and some even went bankrupt. Some media even claimed that 'the first generation of unmanned retail, which occurred in 2017, is dead.'
**-02-
****Cost and technology are development bottlenecks**
**Affected by the pandemic, under the demand for 'contactless' services, unmanned retail has once again attracted market attention and has been accepted by consumers to a certain extent. **But after the pandemic ends, the special scenario of 'contactless' will disappear, and some shortcomings of unmanned retail will be exposed.**
In the view of Ren Feixiang, founder of Beijing Zhuoweizhi Technology Co., Ltd., which focuses on intelligent retail system development, the rise and fall of unmanned retail is mainly because it cannot yet answer the question of whether 'groceries are cheaper for the elderly.'
**The early selling point of unmanned retail was to save manpower and materials and improve efficiency. **However, for the unmanned store itself, the dozens of monitoring devices in the early stage and the large amount of cloud deployment in the background are significant investments.** Although the cost of offline traffic is much lower than online, compared to traditional stores, unmanned stores only save the cost of cashiers; restocking, organizing, cleaning, and operations still require manual labor.
**Xiao Yi, founding partner of Aoying Capital, believes that the large number of closures in unmanned retail was mainly due to high loss rates** 'because the environment is open, and products are easily taken away.' He analyzed that relatively speaking, unmanned retail in closed or semi-closed scenarios is more suitable, such as unmanned convenience stores set up in office areas, maker spaces, and other places. As for larger unmanned supermarkets, Xiao Yi said, **their technology and system development require substantial funds.**
Moreover, the intelligent technology in unmanned stores is not mature, and users often encounter failures such as inability to recognize, inability to settle, and inability to open doors. One such failure may prevent customers from returning.
At the same time, people also find the cumbersome registration and payment processes of unmanned retail troublesome. 'It's very difficult for elderly people like us to operate, and there are no salespeople in the store, making it inconvenient to find things,' 56-year-old Aunt Wang told the Science and Technology Daily reporter.
Retail expert Li Weihua pointed out that practitioners should realize that the key word for unmanned retail is 'retail,' not 'unmanned.' 'Many people define 'unmanned' as the key word, so they mistakenly **highlight automatic payment and unattended operation as store highlights, but completely or greatly ignore the true meaning of the key word 'retail.' Business driven by curiosity and novelty is ultimately impulsive and short-lived.**'
Some experts have summarized that from capital, technology, and manpower to supply chain, refined operations, and scenario value creation, every emerging industry needs stable construction of each link to develop long-term.
For the unmanned retail industry, whether giants or startups, they have encountered obstacles in different links. Therefore, in Xiao Yi's view, unmanned retail is still in the concept stage. 'No matter what kind of retail, the essence is to provide a better consumer experience. At present, unmanned retail cannot achieve this,' he said.
**-03-
****Comprehensive AI supermarket may become a trend**
Despite this, Ren Feixiang remains optimistic about unmanned retail. **'After three revolutions in department stores, chain stores, and supermarkets, the retail industry is now undergoing a fourth revolution, which will bring humanity into the era of intelligent commerce,'** he said.
According to the '2018-2023 China Vending Machine Industry Market Prospect Forecast and Investment Strategy Planning Analysis Report' released by Qianzhan Industry Research Institute: Although China's unmanned retail stores currently lack both quantity and maturity, and user entry conditions are not perfect, with user scale not yet achieving volume, **with the promotion of internet technology and the penetration of unmanned retail concepts, the user scale and transaction volume of unmanned retail stores will usher in explosive growth.**
Giants have not given up exploring. Last year, retail giant Walmart launched its new 'Future Store.' This 'Future Store' is actually a testing ground for emerging technologies, including AI-powered cameras and interactive displays.
Although Amazon Go has only 10 stores in the United States, there are frequent reports of Amazon Go technology updates and function enhancements, and its stores are also expanding. They hope to open more than 3,000 physical stores in the United States by 2021.
According to the latest estimates from the Royal Bank of Canada, Amazon Go's revenue is about 50% higher than that of ordinary convenience stores, with an average annual revenue estimated at $1.5 million, and it is predicted that Amazon Go will reach a scale of $4.5 billion by 2021.
In Ren Feixiang's view, 'In the short term, fully unmanned retail is not a major trend. Restocking and replenishing require people, and the time and money costs to solve these technical problems are very high, and there is no need to solve them. In the short term, intelligent retail that reduces manpower and improves operational efficiency is easier to popularize and provides a better consumer experience.'
He said, **any technological innovation must ultimately return to the essence of business, that is, whether it can reduce costs and increase sales, which is also the direction that companies in the industry are working towards.** 'Since its inception, Zhuoweizhi has deployed a complete set of intelligent retail solutions around this goal,' including unmanned checkout counters with an accuracy rate of up to 99.9%, handheld inventory systems for rapid restocking, and an AI system based on big data analysis currently under development.
'Everyone is trying to apply unmanned or high-efficiency retail in various scenarios from different dimensions, while also accumulating artificial intelligence technology,' Xiao Yi said. In the later stage, it depends on whether giants can combine various supermarket scenarios to form a comprehensive AI supermarket, rather than using AI as a single application to reduce labor costs.
Source: Science and Technology Daily, Author: Cao Xiuying


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## Citation metadata

- Publisher: New Distribution
- Author: 操秀英
- Published: 2020-03-04
- Canonical: https://xinjignxiao.com/en/articles/can-unmanned-retail-seize-the-opportunity-to-turn-the-tables-after-the-p-2679169f/
- Original source: https://mp.weixin.qq.com/s/ADJxMubetRx5K1GqhmKFSQ

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