Instant retail is bringing brick-and-mortar stores back to retail

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A JD Daojia employee is seen riding a scooter in Shenyang, Liaoning province in April. [Photo/CHINA DAILY]

SHENZHEN — Food for pet turtles, adapter plugs for overseas travel and hand-held paint sprayers were usually hard to find in local grocery stores, but Peng Texiang, who owns a shop in south China’s Guangdong province, said he now routinely stocks shelves with the products as more customers go to shops nearby for shopping.

“To some extent, COVID-19 has changed people’s shopping habits,” Peng said, adding that his customers are mainly those who live within 10 kilometers of his store and their orders can be delivered within an hour .

Under the impact of the epidemic, brick-and-mortar stores are making a comeback in Chinese cities as they innovate with new products, services and business models to absorb the trend of instant retail.

Relying on mobile apps like Ele.me and Meituan, Peng’s business started instant retail business in 2015. Since the outbreak of COVID-19 in 2019, Peng has seen increases in both offline shopping and online orders.

According to Peng, nearly 1,000 orders are placed every day and the variety of goods sold in the store has expanded by dozens.

In the past decade, China’s e-commerce has evolved tremendously, with a highly efficient delivery system that employs large numbers of couriers.

By leveraging their physical location and the use of the internet, offline stores are able to offer customers delivery within an hour or even 30 minutes to meet changing consumer demand that prefers to buy when needed rather than to buy in large quantities.

According to a report released by global management and consulting giant Accenture, over half of customers born after 1995 expect their online orders to arrive within a day and 7 percent expect to receive the products within two hours of placing the order online .

Experts believe instant retail is thriving in part because people are moving less to prevent and control the epidemic.

Xing Linbo, dean of evaluation studies at the Chinese Academy of Social Sciences, said Instant Retail not only makes shopping easy and convenient for customers, but also boosts small and medium-sized enterprises and is gradually becoming a new driving force in China’s consumer market.

The volume of instant retail is expected to exceed 1 trillion yuan ($145.1 billion) by 2025, according to research center iResearch.

However, instant retailing requires heavy investments in human resources, technical support and marketing. Only by developing profitable models can the overall market size grow steadily, said Lai Youwei, head of the Meituan Research Institute.

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