Updated: Unmanned stores could see first big failure as Bianlifeng rumored to be pulling smart shelves from 38 Chinese cities

Bianlifeng (便利蜂), the operator of Chinese staff-less stores and smart vending machines, released a notice to its employees yesterday announcing that they will start pulling out vending machines from 38 cities in China an unnamed employee told Pingtu360. Except for the eight selected cities that they are currently testing the unmanned shelves in and the three other cities they plan to expand into, they will end the smart vending machine operation in the rest of the locations.

The cut-down is said to affect approximately 1000-2000 employees who will likely lose their jobs.  Bianlifeng currently has about 1000 shelves per city, which means they are removing approximately 40,000 shelves.

It is also worth noting that it was only last week when a Bianlifeng spokesperson claimed that they will increase the deployment and widen the coverage of unmanned shelves across Chinese cities including Beijing.

In a response to Technode, a Bianlifeng spokesperson said: “Since this year, the un-manned shelf industry has moved past the phase of deploying a large number of selves and shifted towards improving operational efficiency — smart vending machines have proven to be an essential element for efficiency. And because these power- and Internet-connected vending machines can provide operators with information including the number of items in-stock, the machines can be restocked in a timely and precise manner. Once we resolve the issue concerning the damaging of goods, we can sell higher-priced items and goods with a shorter shelf life to better meet our user demands. After rolling out smart vending machines, our customer satisfaction has significantly improved.”

Nevertheless, the company noted that it’s a highly competitive market, and there is currently a serious shortage of smart vending machines. “We have already moved ahead and selected a number of major manufacturers, but still, the shortage in the markets cannot be resolved in short-term. We will select the first batch of cities for high-density deployment of these smart machines.”

Founded by Zhuang Chenchao, former Qunar CEO, in 2016, Bianlifeng is a Chinese startup that operates a chain of QR code and mobile payment-enabled cashier-free stores called Convenience +. The convenience stores target consumers at the higher-end by selling high quality imported goods. The company also provides other services including online ordering, in-store pickup, and home delivery. Bianlifeng launched its smart vending machine business in late 2017 and rolled out about 50,000 machines throughout China. These shelves are usually located in office buildings and business areas.

In January, Bianlifeng acquired a controlling stake in a smart shelf operator Lingwa to push forward the deployment of smart vending machines. The rapid expansion of the businesses might have caused the company a lot of strain financially. A smart vending machine costs roughly RMB 6000, at a rate that Bianlifeng currently deploys its shelves, that translates to roughly 200 million a month on new shelves alone.

Updated 21:40pm 19 March 2018: Bianlifeng spokesperson has told Technode that because there is a shortage of smart vending machines, they will only select a number of cities to deploy these smart machines extensively.