Retail

BingoBox’s Unattended Retail Revolution

Stop us if you’ve heard this one before.

A consumer on the hunt for fresh food and grocery items steps into a convenience store with nary a human physical worker in sight and checks in with a mobile payments app. The consumer then chooses the desired products, scans them via mobile phone, checks out and leaves. Cameras in the store keep track of what the consumer is grabbing, making sure everyone who should be in the store has properly identified themselves digitally.

Assuming shoppers have checked all of their shopping and paying boxes correctly, they can simply walk out of the shop, items in-hand — all without ever having to stop and chat with human workers.

For those reading along and wondering why we’ve described the Amazon Go experience slightly incorrectly, the answer is we haven’t. We aren’t talking about Amazon Go; we’re describing its Chinese counterpart BingoBox.

The Amazon Go concept has been around for some time. Amazon announced its plan to build a totally unattended retail store in early 2017, but there was something of a gap between the announcement of the company’s plan for a sensor-based, cashier-less shopping experience here in the United States and its actual rollout in late January of this year. The company experienced some early difficulties with its “just walk out” technology that saved consumers from having to scan their items. According to reports at the time, the system was having trouble keeping tabs on items once they had been moved from their original shelf when more than 20 people were in the store at once.

While Amazon was working its way through that technical issue, on the other side of the world, BingoBox was opening its first location in Shanghai — one of only a handful of locations it had as of 2016 — getting ready to kick its unattended retail ambitions into high gear.

Today, BingoBox has nabbed $80 million in venture funding and operates over 200 of its self-service specialty stores in 29 Chinese provinces. As of November of last year, the store made its first push into commerce outside the Chinese mainland with an opening in Hong Kong. A BingoBox representative told PYMNTS that Hong Kong is a “baby step” for the company. Its bigger vision is to add its fresh food convenience stores to “several” Asian countries by the end of the year, although they offered no specifics on which countries those might be — or when that expansion will be underway.

BingoBox has a somewhat lower-tech approach to the market than Amazon. Instead of relying purely on cameras and sensors to determine what users place in their shopping carts and then auto-charging them through their Amazon payments account when they walk out the door, BingoBox’s items come embedded with a radio-frequency identification (RFID) tag. When checking out, users scan their items using a standard self-checkout machine and then pay using WeChat. Other than the fact that there are no employees around, it’s a fairly similar experience to using a self-checkout machine at any American grocery store.

However, BingoBox affirms the RFID tags are a temporary feature of the system — they’re slated to be phased out in the near future — although a representative from the company again didn’t have any specific timeline for that change. The goal is to replace them with a sensor/facial recognition-based system à la Amazon Go as the firm grows.

While BingoBox’s growth path is aggressive, it will also likely be littered with competition. Self-service retail is big in China and, unlike Amazon, BingoBox is far from the only player in the unattended retail game. According to reports, Chinese data aggregator ITjuzi, in the third quarter of 2017 alone, found that China’s cashier-less stores sector attracted 1 billion yuan (about $156 million) in funding.

And those are just the startups; the big names in Chinese retail and eTail have also made their interest known.

JD.com, for example, announced that it intends to partner with China Overseas Land & Investment to build hundreds of stores that combine facial recognition, QR codes and RFID to eliminate checkout. Tencent and EasyGo, another venture-backed startup focused on cashier-less stores, have been collaborating on self-service pop-up retail events that allow consumers to stock up on WeChat-related goods.

While Alibaba hasn’t made any recent announcements regarding unmanned physical stores, last year it did roll out the automated Tao Cafe — a temporary coffee shop that had no cashiers (it did, however, feature baristas, as someone still had to make the coffee).

The unattended retail revolution is warming up in the U.S., but it seems to be catching fire in China. Will BingoBox lead that charge?

It’s hard to say, as there’s a loot of players to challenge the company, and some of them are already quite scaled.

But BingoBox has been cashier-free for some time, and its foothold is growing. It might well be a firm to watch.

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