Convenience stores - better performance through modern data and analytics
In August 2016, Alibaba launched a retail management system targeted at mom-and-pop convenience stores called Ling Shou Tong. Ling Shou Tong means “retail integrated” and it is an attempt to leverage digital technologies to provide merchandising and inventory management assistance to convenience stores.
Nearly 600,000 mom-and-pop stores which is approximately 10% of the market in China use the platform. A store owner can use the app associated with the platform to refill their stock. Then the inventory is shipped from Alibaba’s warehouses eliminating the need for middlemen which should be more cost effective. The platform gives retailers access to analytics including recommendations on what items the retailer should buy based on what is popular. The app also helps retailers refine their merchandising and in-store promotions.
In exchange for free use of the platform Alibaba is able to use the retailer’s stores for fulfillment and delivery. Alibaba also receives data from the mom-and-pop retailers on customer shopping patterns. This and Alibaba's other retail initiatives enable Alibaba to extend its reach into offline retail where the majority of retail sales take place in China and take a leadership role in the modernization of retail.
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