Are automated stores the future of retail in China?

The world seems to now follow a path aiming at the removal of the human error factor through technology and automatization. From pilot-free aircraft to captain-less ships and self driving cars, this phenomenon is rapidly spreading.

China in particular seems to be very keen on the technology.

The online retailer JD.com has now opened over 20 JD.ID X-mart, an unmanned convenience store, in the country and plans on continuing its expansion both nationwide and internationally as it recently opened its first store in Indonesia. The store allows clients to shop without having to wait in line or pay in person as their credit card is automatically being charged for what they have chosen as they exit the location.

Shanghai has also lately seen the opening of an automated store called X-24h. Visitors are asked to step on circular panels in front of capsule-style cases filled with bakery goods such as croissants and doughnuts. They can observe robots as they are freshly baking and packing the products. This brings a whole new experience to customers. Shanghai Geant Investment, the company behind the project, aims at bringing visual entertainment to its clients in the form of robots.

Using artificial intelligence and mobile payments technology, visitors must scan a bar code for the case to open and leave as their phones are being automatically charged.

China is the ideal region for these automated stores to thrive due to domestic labor force conditions. As the population in China is aging and people are fighting to escape low-end jobs, unmanned stores seem to be the solution. Moreover, Chinese consumers are open to new experiences and very fond of all technological solutions. They are more flexible and embrace new innovative options. Indeed, as of mid-2017, over 35% of all Chinese mobile phone users had often made mobile payments.

However, the human touch lacks in those stores and technical glitches can quickly happen and hold them back.

Some challenges still need to be overcome before technology fully takes over.