Click 'Read Original' for details. Only when the tide goes out do you discover who's been swimming naked! Once upon a time, this famous saying was applied to shared bikes. Now, unmanned supermarkets have become another bubble in the internet economy. After countless capital poured into this money-burning war, unmanned supermarkets are left with nothing but a mess.

Unmanned Supermarkets, Unvisited Let's go back two years to July 7, 2017, when the unmanned supermarket 'Tao Coffee' officially opened, claiming you could pay without pulling out your wallet or phone. As Ma Yun's first unmanned supermarket, 'Tao Coffee' was bustling and glorious. Major media rushed to report, hyping new retail: 'Unmanned supermarkets are not just cool; they are a new opportunity for retail.' 'Unmanned supermarkets are here; if you don't work hard, you'll be out of a job!' 'Unmanned supermarkets are a technological revolution; in the next 3-5 years, physical department stores will face unprecedented impact!' ... Soon, restless capital began pouring into the new gimmick of 'unmanned retail,' with JD.com, Suning, and various capital players jumping on this trend. Startups like Bingo Box, F5 Future Store, Xiaomaipu, Xianbianli, and GOGO, all under the banner of 'unmanned retail,' sprang up like bamboo shoots after rain.

Main financing for unmanned retail in 2017 (Source: iiMedia Research) After Ma Yun fired the 'first shot,' according to market institutions, in 2017 alone, a total of 25,000 unmanned retail shelves were deployed nationwide, 200 unmanned supermarkets were set up, and the unmanned retail market raised over 4 billion RMB in cumulative financing.

However, the good times didn't last long. Soon, unmanned supermarkets faced a wave of closures. In July 2017, Shanghai's first unmanned convenience store, 'Bingo Box,' announced its closure just one month after opening. It's worth noting that Bingo Box had received favor from many investors when it first appeared.

Shanghai's first unmanned convenience store closed As the first unmanned supermarket in Southwest China, Chengdu's GOGO unmanned supermarket announced its closure, and the unmanned shelf project 'GOGO Xiaochao' under the same company also ceased operations. Meanwhile, the company was also exposed for owing employee wages. GOGO unmanned supermarket was established in September 2017, and it operated for only a little over four months. In March 2018, Changchun's first unmanned supermarket opened near the Children's Hospital on Jilin Street. However, just one year later, in May of this year, this unmanned supermarket ceased operations and quietly put up a 'for transfer' sign.

Changchun's first unmanned supermarket closed Whether it's unmanned supermarkets, unmanned convenience stores, or unmanned shelves, the companies facing operational difficulties are far more than just these few. From the spotlight at their 'debut' to being ignored now, it took less than two years. What exactly went wrong with unmanned supermarkets?

Where Did Unmanned Supermarkets Go Wrong? When unmanned supermarkets first appeared, various black technologies dazzled people's eyes. However, over time, unmanned supermarkets gradually fell from their pedestal, turning from myth to joke. Not long after Ma Yun launched his unmanned supermarket, a news story attracted widespread market attention: 'Unmanned Supermarkets Defeated by Chinese Aunties.' The story mainly said that due to hot weather, a group of aunties ran into an unmanned supermarket to cool off. They sat on the floor chatting, almost blocking the entire store. Although this news seemed quite funny, and the aunties 'waving feather fans and chatting about family matters' might not necessarily be in an unmanned supermarket, it still reflects the various problems in the business model of unmanned supermarkets as a form of new retail.

1. High Operating Costs Compared to physical department stores, the operating costs of unmanned supermarkets are not low. It seems that without staff on duty, labor costs are saved, but in reality, staff salaries account for only a small part of operating costs. For physical stores, rent is the largest part of operating costs. Additionally, for stores with better conditions and larger spaces, utility costs exceed labor costs. As for unmanned supermarkets, they not only bear rent, utilities, and property fees, but also need to equip relevant technical devices and regular technical maintenance. The one-time investment is huge, and compared to physical stores, the investment cost is even higher. With capital influx, so-called internet-thinking entrepreneurs burned money to expand, recklessly increasing market share without considering costs. Once the capital chain breaks, large-scale closures and bankruptcies of unmanned supermarkets are inevitable.

2. No Competitive Advantage Over Physical Stores From the consumer's perspective, there isn't much difference between unmanned supermarkets and physical stores. Whether there are staff or not, the products are the same. With physical stores saturated, unmanned supermarkets also struggle to find advantageous locations. After all, which residential community doesn't have a small shop downstairs?

3. Security Risks Unresolved Due to the 'unmanned' nature of unmanned supermarkets, their safety is not guaranteed, making them easy targets for criminals. Not long ago, a robbery occurred at an unmanned supermarket in Zhanjiang, Guangzhou. On May 23, several men broke into an unmanned supermarket in Zhanjiang Development Zone with knives and stole a large number of goods. In the store's surveillance video, the men acted arrogantly and committed illegal acts without regard for others, sparking public outcry. Although the case was quickly solved by local police and all seven suspects were arrested, it highlights the security risks caused by the 'unmanned' aspect of unmanned supermarkets.

4. Technology Without Human Touch As a business model hyped by new retail, the 'technology without human touch' of unmanned supermarkets might be the main reason for their failure. Although mobile payment has become mainstream, a considerable number of people still prefer cash payments. Because unmanned supermarkets are 'unmanned,' the only payment method available to consumers is cashless payment. This alone is enough to deter many people. Furthermore, when consumers face a dazzling array of products, there's no one to ask. How can they quickly find what they want to buy? How to use a product or what precautions to take is also not communicated. Unmanned supermarkets boast of saving time and making shopping more convenient, but in reality, they seem to be moving backward. A business model with only technology and no human touch clearly doesn't match Chinese consumers' tastes. Look at the long queues at certain hotpot restaurants, tea shops, noodle shops, or internet-famous stores; even with long waits, people are still happy to do so. In a consumer culture that values 'popularity,' 'unmanned' might be destined to be unvisited.

What Other Tricks Does New Retail Have? After many internet giants proposed the concept of new retail, various new ways of playing around offline stores emerged. Whether it's unmanned supermarkets or Hema Fresh, behind these shiny storefronts, have they really changed the retail landscape? Have they truly bridged the gap between online and offline? From an ordinary consumer's perspective, the most intuitive feeling of new retail is that product packaging is more luxurious, mobile coupons are more numerous, and of course, product prices are higher than other physical stores. Unmanned supermarkets have fallen from grace, but among capital and big shots, there are many skilled storytellers. What other tricks new retail will have in the future, we don't know. For countless entrepreneurs, before talking about the future being here, remember that the road is under your feet.

Source: Finance Breakfast (ID: Femorning)