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Abstract: This trick obviously follows the “only fast not broken” method in the Internet economy, but in the “heavy operation” mode of quickly seizing market share, how to ensure the service quality of unmanned store supporting measures such as supply chain and goods, and how to keep up with the rapid iteration of technological progress in a timely manner are still problems that Binguo Box has to face.
Author | All-weather technology Xu Zhicheng
Edit the | All-weather technology Zhang Feifei
Just like the weather in recent days, the hot “unmanned retail” rushed to the investment outlet overnight, and the enterprises operating in the outlet have also become the focus of public opinion.
On July 7, due to the continuous high temperature in Shanghai, the temperature in the box was too high, and the official announced the suspension of business, and it did not continue to operate until July 12, which once attracted a lot of attention.
Chen Zilin, CEO of Binguo Box, who is at the center of the storm, is very calm, he told All-weather Technology, “Auchan Changyang store has too much traffic, more than 200 transaction orders a day, the door has been open and other reasons have caused the air conditioning load to be overloaded, and the temperature of the box is too high.” But in fact, of the 10 boxes we have landed so far, the other 9 are operating normally. ”
“Regarding the landing of the box, in the future, we will consider areas that better match our site selection model. If we must choose a place to sunbathe, we will consider taking more shading measures: such as increasing the number of air conditioners, internal insulation, external shading and cooling, etc. Chen Zilin said.
On July 3, the company just received a series A financing of more than 100 million yuan led by GGV Jiyuan Capital and co-invested by Qiming Venture Capital, Source Code Capital, and Yintai Capital. Compared with Amazon’s Amazon Go, Ali’s “Tao Coffee”, Deeplan’s TakeGo, etc., Binguo Box is the first large-scale commercial unmanned retail store in the Chinese market.
It is reported that as early as August 2016, Binguo Box launched project testing in Zhongshan, Guangdong, and in Shanghai in early June this year. At present, in addition to Zhongshan, Guangdong and Shanghai Overseas, the binguo boxes in South China are also being gradually laid, and it is planned that the first binguo box in Beijing will be launched in Wangjing at the end of July, and 200 boxes will be officially landed nationwide by the end of August, and 5,000 boxes will be laid within one year.
This trick obviously follows the “only fast and not broken” method in the Internet economy, but in the “heavy operation” mode of quickly seizing market share, how to ensure the service quality of unmanned store supporting measures such as supply chain and goods, and how to keep up with the rapid iteration of technological progress in a timely manner, is still a problem that Binguo Box has to face.
In order to achieve complete unmanned, the technology still needs to be improved
From the perspective of the technology that has been disclosed on the market, there are two main ways to recognize objects in unmanned supermarkets, one is tags (two-dimensional code, RFID), and the other is machine vision. Combined with the current trend of AI development, machine vision will undoubtedly become the mainstream development direction in the future. However, the disadvantage is that the research and development cost is high and the technology is not very stable. Even Amazon’s Amazon Go, the originator of unmanned retail, is not being commercialized now.
According to public information, RFID technology was born in 1930, and was widely used during World War II, and is now very mature and widely used in the field of clothing. The disadvantage of RFID technology is that the cost is too high, and only one tag requires about 1 yuan. In addition, RFID non-affinity media are very many, can not be applied to metal, liquid, internal aluminum foil packaging, encounter liquid is also because of absorption and misreading is serious, and RFID is very easy to be shielded, label pasting, trouble easy to be torn, size and sensing distance are not easy to coordinate.
An industry insider, who did not want to be named, told All-weather Technology: “In fact, many of Ali’s ‘Tao Coffee’ products use the event label of the Creation Festival to superimpose RFID solutions.” When he paid that day, he took five or six items and put them in his bag, and two of the same kind of goods were only identified as one, and the other was taken out ‘for free’. RFID technology itself is defective, and the tag will not be recognized if it is tightly pinched, thus affecting the accuracy of identification. ”
For the cost and technical defects of RFID. Chen Zilin had a different view. “RFID does have additional costs compared to image recognition. We did the design of RFID low-cost in the early stage, our cost is completely acceptable, the current ten boxes of RFID costs are far less than a person’s salary cost, from this level, does not affect our profits. But he was reluctant to disclose the specific cost of RFID tags.
And he also believes that product identification is the most advanced technology in unmanned convenience stores, it is not even the most important technology. “How to identify the goods is the first step, and the early use of RFID technology can quickly build a sales system.” The exploration of operations is the most difficult, so we will spend a lot of time exploring operations such as supply chains. Chen Zilin said.
Obviously, rash radicalization still faces many technical obstacles. Whether it is Ali “Tao Coffee”, or Binguo Box. However, according to the official disclosure of Binguo Box Company, since August 2016, after ten months of trial operation, Binguo Box has received tens of thousands of customers, and the user repurchase rate is close to 80%.
“This also allowed us to find some problems, which provided a good experience for future development.” It has been proved from practice that the current scheme we use RFID is mainly because of efficiency, but RFID is also our transition product at present. Chen Zilin said. The later product will replace RFID with image recognition, which is planned to be launched around August, but at present, it is mainly to bring the scene of unmanned sales to everyone and cultivate users’ consumption habits.
Bet on the “heavy operation” model to take the share of land first
One of the most important things Alibaba has done in the past five years is to tell every retail company that it needs to do e-commerce, and to do e-commerce in China, it is necessary to open stores on Taobao and Tmall. In fact, each brand has a fixed consumer group, and will not soar in sales because of e-commerce.
Because the consumer group is still fixed, the market is the same, but the purchase channel has changed. Not only offline stores have to bear the rise in labor and rent, but also pay additional traffic advertising fees, operation costs, logistics packaging fees, etc. of Tmall stores online. When online orders increase, offline entities are greatly weakened, and actual profits are not better than offline.
And this is exactly the situation that Chen Zilin, CEO of Bingo Box, has faced. He shook his head with a sigh and said to the all-weather, “I used to make binguo fruits, and the reason why I transformed into binguo boxes was to see that the density of online orders was very high, and the fulfillment cost was already very high at that time, so I could only compress the distribution cost and put the refrigerator in the community.” So at that time, I thought that since we were selling fruit, why not sell snacks and make an unmanned store to reduce more online and offline costs, so in February 2016, we officially put all the main efforts of the whole team into this project. ”
The radical strategy of laying 5,000 boxes in 1 year has led many people to think that the current model adopted by Bingo is somewhat similar to the operation-heavy ofo. According to the official data released by Binguo Box, the cost of each 15-square-meter box is about a quarter of that of traditional retail stores. According to the calculation of laying 5,000 boxes within a year, the binguo box will have to invest at least 500 million yuan. If you want to seize the market by burning money, this 500 million yuan is obviously not enough.
But Chen Zilin is not worried, and said that there is no restriction on direct management or joining. “Because we don’t lose money wherever we put this box. As long as the franchisee has the strength and can complete the task I give you, then it is no problem. 5000 is just a conservative plan, mine has more than that. Individual-specific franchise policies will be announced at the end of August.
“This market is big and there will definitely be competition and a lot of people will come in. However, unlike the sharing economy, the comprehensive threshold of unmanned convenience stores is very high, including the BD ability of the team, the production capacity of the back-end supply chain, the management ability of the back-end goods supply chain, and the investment of technology, so it belongs to a project with a high starting point and a high threshold, and there will not necessarily be a situation of sharing bicycles. Chen Zilin said.
It is understood that Binguo Box has established its own supply chain brand – Beith, to explore the supporting solutions of unmanned stores. In addition, Bingo also cooperated with Auchan and RT-Mart to address the early supply chain and supply of goods. But Chen Zilin believes that the highest priority is to lay the channel at present.
Industry insiders believe that unmanned retail stores, as a supplement to traditional retail, are not easy to replace large offline supermarkets in the short term. At present, Binguo Box adopts RFID scheme, which realizes management and cash register in a small space such as a convenience store, which is more in line with the current market pain points.
Compared with the machine vision technology used by Amazon, Huang Peihua, partner of Qiming Venture Capital, told All-weather Technology, “Amazon Go’s approach is more challenging, because it uses visual recognition technology at the beginning, and when customers flood in a lot at one time, its recognition is not very accurate, so it cannot operate normally later.” On the contrary, the solution of Bingo Box is relatively simple, mainly using the already mature RFID technology. ”
With the development of AI technology, it is still unknown whether the RFID solution can help Binguo Box seize the market before the arrival of AI smart retail. But offline retail is not only the focus of competition for start-ups, on April 10, JD.com announced that in the next five years, JD.com will open more than one million JD convenience stores across the country to accelerate online and offline integration. Jack Ma also put forward the concept of new retail, the future online and offline retail will have no boundaries, unmanned convenience store strategy is expected to be an important part of “new retail”.
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