Over one million convenience stores in China, around one-sixth of the total market, are now using Alibaba’s LST platform (Ling Shou Tong) to help manage their operations.
LST is designed to help these small scale ma and pa stores by providing a platform where operators can crunch sales and operations data, analysing it and turning it into insights. According to the Chinese ecommerce giant, the LST platform effectively erases the friction and layers between FMCG brands, distributors and shop owners.
Statistics showed that there are over six million corner stores in China, but most have struggled to survive under the pressure of skyrocketing rent and staff costs, as well as an inherent lack of management tools.
Connecting to LST means these stores have the option of becoming what’s known as a “Tmall Corner Store.” Through a makeover and optimisation of product selection, inventory tracking and in-store digital advertising, these stores have shown they can reverse the sector’s downward revenue trend.
Alibaba statistics show that when a ma and pa store transforms itself into a Tmall Corner Store, its daily turnover increases by 30 per cent, on average.
“New Retail not only empowers the big players, it will also allow every street corner store to benefit,” said Daniel Zhang, Alibaba Group CEO.
“We share a common goal with millions of small shop owners, which is to turn every one of them into a smart store that blurs the boundaries of online and offline retail to bring together the power of both retail spaces.”
Equipped with Alibaba’s big data, LST is capable of advising store owners on customer preferences, pricing strategies and inventory levels. As a component of the Alibaba ecosystem, LST also allows shop owners connected to the platform to bring their business online, enabling these stores to be found on the Taobao app, Tmall, AutoNavi Map, Alipay and Ele.me, greatly expanding their reach.
Shop owners can also lease unmanned vending machines from LST to generate more revenue during non-operating hours.
For FMCG suppliers, LST helps them identify matching stores in terms of customer and product profile, implement precise marketing strategies and assist in decision-making, based on sales.
“In the past year, more than 3,500 FMCG brands have landed on LST, thanks to the proven track record of the platform in providing store owners with logistics, sales and marketing support. By strengthening the presence of these corner stores, LST offers value-added services in local neighborhoods,” said Lin Xiaohai, General Manager of LST.