1ST QUARTER 2018
World News
PHILIPPINE RETAILING
Amazon opens
automated grocery
store to public E-commerce is the fastest-
growing global retail channel
through 2022: report
Amazon.com Inc opened to the public its
checkout-free grocery store after more
than a year of testing, moving forward
on an experiment that could dramatically
alter brick-and-mortar retail. Internet retailing is the fastest growing global
channel through 2022 at 73% to become a larger
channel than traditional grocery retail, according
to global market research company Euromonitor
International which released its new retailing
industry data alongside the second annual What’s
New in Retail: Emerging Global Concepts report.
The Seattle store, known as Amazon Go, relies on
cameras and sensors to track what shoppers remove
from the shelves, and what they put back. Cash
registers and checkout lines become unnecessary
as customers are billed after leaving the store using
credit cards on file.
Within internet retailing, the food and drink category is
expected to see the fastest growth at 80%. “While store-based modern and traditional grocery retailing
combined will remain larger, internet retailing is changing the traditional way of shopping for many
products, but especially for groceries,” said Michelle Grant, head of retailing at Euromonitor International.
The convenience-style store opened to Amazon
employees on Dec. 5, 2016 in a test phase. At the
time, Amazon said it expected members of the
public could begin using the store in early 2017. But
there have been challenges, according to a person
familiar with the matter. “It’s no surprise that now three of the top five largest retailers in the world are internet retailers,” continued
Grant. “JD.com entered the top five in 2017, making it the third e-commerce player in the top five joining
Amazon and Alibaba.”
Gianna Puerini, vice president of Amazon Go, said
in an interview that the store worked very well
throughout the test phase, thanks to four years of
prior legwork. Tao Café, a pop-up convenience store from Alibaba, ranked first place in the grocery channel, paving the way
for cashier-free stores in China. Using facial recognition among other advanced technologies, customers
need only their smartphone equipped with Alibaba’s Taobao app to enter and checkout.
“This technology didn’t exist,” Puerini said, walking
through the Seattle store. “It was really advancing
the state of the art of computer vision and machine
learning.”
Sleek black cameras monitoring from above
and weight sensors in the shelves help Amazon
determine exactly what people take.
If someone passes back through the gates with an
item, his or her associated account is charged. If
a shopper puts an item back on the shelf, Amazon
removes it from his or her virtual cart.
Much of the store will feel familiar to shoppers,
aside from the check-out process. Amazon, famous
for dynamic pricing online, has printed price tags
just as traditional brick-and-mortar stores do.
(Reuters, 01/23/2018)
With mobile internet retailing expected to reach 50% of total e-commerce sales in 2019, retailers are looking
at the next wave of technology to create new ways for consumers to shop.
(RetailAsiaOnline, 01/16/2018)
India relaxes FDI rules
The Indian government has announced
sweeping relaxations in foreign direct
investment (FDI) rules in single-brand
retail and other areas.
Currently, only 49% of FDI was allowed under
automatic route in singe-brand retail. Investment
beyond that level required government approval.
like H&M, which started operations in India in 2015,
and Ikea, which plans a 2018 opening, both have
been seeking such a relaxation.
The reform is
attractiveness as
as well as drive
supply for retail
expected to boost India’s
an investment destination
growth in the real estate
sector in the near future.
(Economic Times, Moneycontrol, 01/11/2018)
Furthermore, single-brand retailers can set off
“incremental sourcing of goods from India for global
operations during initial five years, beginning April
1 of the year of the opening of first store against
the mandatory sourcing requirement of 30% of
purchases from India”. After five years, the firm will
have to meet the sourcing norm every year.
Commerce and industry minister Suresh Prabhu
said the government has decided to “remove
roadblocks” to foreign investment. “We hope it will
facilitate faster development of the economy,” he
said.
Industry experts as well as the Retailers Association
of India (RAI) have hailed the new foreign investment
norms as a positive step.
“We believe the decision to allow 100% FDI through
automatic route will ease the process for foreign as
well domestic brands,” Kumar Rajagopalan of RAI
said in a statement.
Brands such as Uniqlo and Xiaomi which had
applied to start single-brand retail businesses may
now get approval under the automatic route. The
easing of the sourcing rules should help companies
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