--- title: "Zhao Bo: Focus Less on Technology, the Core of Unmanned Retail Lies in Supply Chain" description: "At the Shanghai International Unmanned Store & Retail New Terminal Service Innovation Exhibition, Zhao Bo, editor-in-chief of New Distribution, shared his views on unmanned retail. He emphasized that the future belongs to unmanned consumption scenarios, but the key competitive advantage lies not in technology but in supply chain integration and logistics support." author: "赵波" publisher: "New Distribution" email: "zhaobo258@gmail.com" telephone: "+8615854817671" published: "2017-10-07" language: "en" canonical: "https://xinjignxiao.com/en/articles/zhao-bo-focus-less-on-technology-the-core-of-unmanned-retail-lies-in-sup-b7253edd/" markdown: "https://xinjignxiao.com/en/articles/zhao-bo-focus-less-on-technology-the-core-of-unmanned-retail-lies-in-sup-b7253edd.md" original_source: "https://mp.weixin.qq.com/s/puR0_NmTdIWgz4lKPDJMIw" translation: "https://xinjignxiao.com/zh/articles/%E8%B5%B5%E6%B3%A2-%E5%B0%91%E5%85%B3%E6%B3%A8%E6%8A%80%E6%9C%AF-%E5%81%9A%E5%A5%BD%E6%97%A0%E4%BA%BA%E9%9B%B6%E5%94%AE%E6%A0%B8%E5%BF%83%E8%BF%98%E5%9C%A8%E4%BA%8E%E4%BE%9B%E5%BA%94%E9%93%BE-b7253edd.md" attribution: "New Distribution — https://xinjignxiao.com/en/articles/zhao-bo-focus-less-on-technology-the-core-of-unmanned-retail-lies-in-sup-b7253edd/" usage_policy: "https://xinjignxiao.com/ai-policy.txt" --- # Zhao Bo: Focus Less on Technology, the Core of Unmanned Retail Lies in Supply Chain > At the Shanghai International Unmanned Store & Retail New Terminal Service Innovation Exhibition, Zhao Bo, editor-in-chief of New Distribution, shared his views on unmanned retail. He emphasized that the future belongs to unmanned consumption scenarios, but the key competitive advantage lies not in technology but in supply chain integration and logistics support. Recently, the Shanghai International Unmanned Store & Retail New Terminal Service Innovation Exhibition was held at the Shanghai World Expo Exhibition and Convention Center. The conference attracted representatives from the self-service retail sector and experts from related fields, who discussed trends in unmanned stores and unmanned retail technology. Why is the future an unmanned consumption scenario? How can it support the new terminal supply chain? Zhao Bo, editor-in-chief of New Distribution, shared his views. **The Future Belongs to Unmanned Consumption Scenarios** China has over 6.2 million retail stores, but despite the large number, the market has severely contracted in the past two years. According to a survey by New Distribution, in provinces with a population exceeding 80 million, more than 10,000 mom-and-pop stores close each year. Traditional retail stores urgently need innovation. Meanwhile, the investment in new technologies has led to the rapid rise of new retail formats such as 7-Eleven and vending machines, which are increasingly showing characteristics of consolidation, scale, and chain operation. From a market perspective, when per capita GDP reaches $10,000, consumer demand for vending machines surges. By 2015, regions covering 390 million people in China had reached this level, providing a foundation for unmanned consumption scenarios. From a cost perspective, unmanned consumption also has great market potential. "Data shows that domestic labor costs are now five times what they were in the past. In 2016, employee compensation in China grew by 8% year-on-year, ranking first in the world. At the same time, overall rental costs for venues increased by 7%, further compressing profits for offline stores." The high development of mobile technology is also a key factor driving unmanned retail. Additionally, continuous iteration of smart terminals has increased the richness of sellable products and services, meeting consumer demand for product diversity. From current practices in unmanned consumption scenarios, the proliferation of mobile payment, facial recognition, RFID, and other application technologies, along with big data and IoT applications, and the integration of online e-commerce with offline entities, has extended the replacement of human labor by machines from the industrial sector to the consumer sector. The interaction between smart terminals and humans has improved, making the interaction between products and consumers better. The number of new terminals has increased dramatically, reducing consumption radius and meeting consumption needs in fragmented scenarios. **Three Types of Unmanned Retail Meet Six Major Consumer Needs** Since the future belongs to unmanned consumption scenarios, what types of unmanned retail exist? What are the characteristics of each? First, smart vending machines. Currently, this technology is relatively mature, with high user acceptance and huge market capacity. In Japan, there is one vending machine for every 200 people on average. In China, market penetration is still low. The disadvantages of vending machines include poor interactivity, lack of user experience, limited SKU count, and difficulty in outdoor placement. Second, unmanned convenience stores. Zhao Bo said, "Obviously, they have many SKUs, good user experience, promotional gimmicks, and continuous follow-up from capital and technology. However, their disadvantages are that the technology is not yet mature, technical barriers are high, costs are high, and there are no large-scale cases." Third, open shelves. Their advantages are low cost, quick deployment, fast capital recovery, and fast financing. Disadvantages include high operational difficulty, high restocking costs, high shrinkage, and small market size. With the proliferation of mobile payment technology, high density, short radius, and convenience determine that unmanned retail is an important entry point for O2O. The high integration of online and offline, multiple formats, and the high overlap between unmanned retail and convenience stores and O2O customer groups offer huge expansion space. Additionally, big data, supply chain, warehousing, and logistics systems can achieve high resource sharing, greatly improving efficiency. **Core Competitiveness: Perfecting Backend Supply and Logistics Infrastructure** **"Whoever is closest to the customer is farthest from competition. Whoever helps users save time gains user loyalty."** Zhao Bo said he found that many unmanned retail operators focus their energy and attention on the technology level, but what is more important is the supply chain behind it. **"Unmanned" is not the goal of offline retail, but a means to comprehensively improve efficiency.** The ultimate core competitiveness of major unmanned stores is supply chain integration, which is the mutual integration of **product organization and development, warehousing and logistics system support, and information system support**. In unmanned store operations, single-item management is as important as in ordinary convenience stores. Unmanned convenience stores have a relatively fixed customer base, few SKUs, and repeat consumption, requiring strong single-item management capabilities and product elimination mechanisms. In terms of warehousing and logistics system support, unmanned stores have small areas. Since real-time restocking cannot be achieved during sales and there can be no inventory beyond the shelves, inventory levels should be controlled within the maximum inventory. To avoid affecting consumer experience, unmanned stores must have a small-batch, frequent supply system, relying on JIT logistics distribution and precise restocking system support. Convenience stores, headquarters, logistics distribution centers, and manufacturers should achieve information sharing and logistics visualization in the supply chain management system, thereby achieving the best match between logistics distribution management and order information. For example, Japan's 7-Eleven can deliver four times a day, with each delivery time error not exceeding 20 minutes. Such efficient and real-time precise distribution systems reduce logistics costs equivalent to 10% of the original product price. Finally, the information system aspect. "Without a strong information system, there can be no sustainable development of convenience stores. Unmanned retail stores are small in scale and widely distributed, requiring particularly strong and refined headquarters backend capabilities." **B2B Assists Unmanned Stores** Zhao Bo said that B2B can be said to play a supporting role in the rise of unmanned convenience stores. B2B significantly reduces the procurement costs of small stores through centralized purchasing, one-stop supply, online ordering, and offline centralized distribution. Similarly, B2B can help unmanned retail achieve one-stop procurement of high-frequency goods, compensating for the insufficient supply chain in the early stages of operation. Currently, domestic B2B mainly has two models: self-operated and matching, represented by JD New Channel and Alibaba Retail Link, respectively. JD self-purchases goods and builds its own logistics; Retail Link builds a platform, gathers sellers, and relies on third-party logistics. According to New Distribution statistics, there are about 2,000 B2B companies in China, with no fewer than 500 B2B platforms in the FMCG industry. Generally, cities above the provincial capital level have 20-30 platforms. For example, Changsha has about 36 FMCG B2B companies, covering 70% of small stores in Changsha. These platforms are very beneficial for the development of unmanned stores. Of course, it is not ruled out that B2B will enter the unmanned retail market in the future. Friends interested in unmanned retail can follow the WeChat public account below for more information. **The 3rd (CFIC) China FMCG + Internet Conference** will be held in Chongqing in November 2017. The conference will closely focus on the theme "New Forces, New Ecology" and invite **1,000+ distributors, 500+ brand owners, founders of 200+ B2B platforms, and 100+ investment and financing institutions** to jointly explore a new chapter of cross-border integration! **Core Topics of This Conference:** > * **How can the FMCG industry leverage B2B to achieve new growth opportunities** > > * **How to build the new supply chain behind new retail** > > * **How can intra-city logistics help B2B achieve leapfrog development** **Highlights of This Conference:** > * **The industry's first "2017 China FMCG B2B Industry Competitiveness White Paper"** > > * **Case sharing of excellent distributors in transformation and upgrading** > > * **Exhibition upgrade: Hall 6 Internet Technology Exhibition strengthens matchmaking** > > * **Alibaba Retail Link, GLPG Finance, EASIA Supply Chain, Best Store Plus, Yijiupai, Headin—leaders from various fields will deliver speeches and share pioneering views.** **November 8-9, 2017** **Chongqing Yuelai International Conference Center, Xinyue Hall** **Registration is now open. Long press the QR code below or click "Read Original" to register.** Add friend with note "Conference Registration" Click the link below to review the highlights of the 1st and 2nd FMCG + Internet Conferences: [2016 "FMCG + Internet" Summit Forum]() -END- --- ## Copyright and AI use This article is sourced from New Distribution. Search, quotation, summarization, and model training are permitted, but every use must credit New Distribution and retain the canonical source URL. Contact: zhaobo258@gmail.com · +86 158 5481 7671