This article was originally published on New Retail Insights in Chinese. It is translated into English and published by KrASIA with the original publisher’s authorization.
Kr-Asia is all about actionable insights for entrepreneurs. And through this post, you’re about to find out:
1. What makes BingoBox stands out among many staff-less stores?
2. Why are tech giants and startups weighing in the staff-less convenience store market?
On Jan 22, the usual scene at the downstairs of Day 1 Building in Seattle was broken by a long queue. Unlike what many would assume though, people were not queuing for the food from the nearby grocery stores and doughnut shops, but for a sneak peek at the newly debuted cashier-free convenience store, which, as Amazon claimed, could deliver “just-walk-out” shopping experience.
This cashier-free convenience store, which Amazon started testing with its employees as early as 2016, is justifiably the very first of its kind in human history. Dozens of other startups have emerged in the past year launching similar or identical concepts from 2016 to 2017.
The number of players that have dabbled in the cashier-free convenience store business is huge. Among them include Tao Cafe, a spinoff of the e-commerce behemoth Alibaba, Take Go, a brainchild of Ant Financial and DeepBlue Technology, F5 Future Store backed by Sinovation Ventures, and BingoBox, which is billed as the first 24-hour cashier-free convenience store across the globe that could be cloned at an exponential scale.
The new year has just begun, but the cashier-free convenience store scene is already making noise. On Jan 17, BingoBox (缤果盒子) announced the completion of a US$80 million Series B financing round led by Fosun. Its existing investors, including Prometheus Capital, Qiming Venture Partners, GGV Capital and Ventech China also participated this round.
BingoBox has since its initiation of large-scale expansion in July 2017 found its way into 29 cities across China. And the company is set to, in the coming months, focus specifically on upping the number of its stores in those cities it has already branched out into, thus realizing its goal of deploying one cashier-free convenience store for every 20,000 people.
Thrive in areas with fewer customers:
The cashier-free convenience store, as Chen Zilin, CEO of BingoBox, puts it, is a kind of “new species” in the business world. Running a cashier-free convenience store doesn’t involve much labor cost, so, unlike traditional convenience stores, it could survive in the area where customer traffic is low.
According to Chen Zilin, it’s quite possible that the 24-hour cashier-free convenience store will be favored over those traditional convenience stores around the residential communities, since it stands even closer to the residents’ homes and is stocked with all the daily necessities that the residents might need.
With proven image recognition technology, BingoBox has launched BingoBox Mini, a self-service checkout solution. It is verified that a complete solution can help traditional convenience stores reduce at least a half of labor cost.
In response to this, there are two contributors: term of payment and size of BingoBox Mini. Users will put products on oven-sized BingoBox Mini and scan the QR code to confirm the total amount and complete payment.
Therefore, Chen Zilin regards BingoBox Mini as one of the solutions that can be perfectly combined with traditional stores, for its significant impact on efficiency improvement and cost reduction in the retail industry.
With development of image recognition, FAN AI, the artificial intelligence solution of BingoBox, has realized the learning of 800-1000 SKUs within 10 working days, which is enough for supporting a traditional convenience store. And more studies on AI concerning retail industry are conducted by the company and its partner institutions.
Although movable location is an advantage of BingoBox, it shall be in compliance with urban planning. Therefore, BingoBox has signed cooperation agreement with several governments, including Beijing, Tianjin, and Chengdu.
Angel round—December 2014, RMB 1 million.
Series Pre-A—August 2015, RMB 10 million.
Series A— July 3, 2017, RMB100 million: GGV Capital (lead investor), Ventech China, Source Code Capital, Qiming Venture Partners.
Series B—January 17, 2018, USD80 million: Fosun Capital (lead investor), Ventech China, Qiming Venture Partners, Prometheus Capital, GGV Capital.