The grab-and-go convenience store is being launched by a bunch of 28-year-olds
Mumbai: On 1 May as the world celebrates Labour Day, three 28-year-olds from Pune will rejoice in the launch of their labour of love—an Amazon Go-style unmanned store.
The 500-sq. ft. store located at Water Square Commercial Complex at Pimple Nilakh in Pune will be a 24/7 store sans human presence. The entire shopping journey from entry to checkout is being enabled by a combination of technologies to achieve a seamless grab-and-go experience.
“The fusion of AI and IoT is what helps us automate the entire store. We have also used sensors for weight tracking of the products on the shelves,” explained computer engineer Chinmay Raut, chief executive officer and one of the three founders. The other two founders are Emmanuel Dsouza, an instrumentation engineer who is the chief technology officer, and Amey Rithe, also a computer engineer who is the chief operating officer.
How it works
The store has two levels of barriers at entry and sensor-activated shelves. To enter the store and start shopping, customers have to scan the QR code generated on Jiffi’s Progressive Web App (PWA), which opens the security gates.
As soon as a product is lifted off the shelves, it gets registered by sensors as well as computer vision (CV). Once customers finish adding products to the physical carts available at the store, the camera at the exit gate processes the items and a physical bill is sent to the customer on the Jiffi app. Discounts, if any, are offered on the app itself. Once customers pay for purchases on the app through digital payment options like UPI, net banking or cards, the gates open.
In case of an attempted robbery or an attempted exit without making the payment, the gates automatically lock down. Any physical breakdown is reported to the control hub, which is just 20 minutes away.
The entire technology as well as the store design has been developed in-house. “Except for painting and electrical wiring work, everything is done by us,” joked Raut, who along with his partners, has been working on the dream almost since 2014, when they were motivated to attempt something like this after a bad checkout experience at a large format retailer.
“We wanted to disrupt the current traditional retail experience to provide a seamless and effortless experience,” said Raut.
Over the years, while Raut and Rithe worked with retailers, Dsouza worked with Porshe in Germany (among other places) and became an IoT expert.
After trying their hand at other cashier-less technologies, they finally cracked the code on an unmanned store with the right technology know-how, resources and guidance.
“Just last week I went and reviewed the store. The tech is solid. And the store is ready to go. We’re just doing the final touches,” said Ajay Aggarwal, managing partner at 100Watts, a Pune-based venture studio focused on tech innovation for retail & consumer brands that works with startups to build and accelerate product market fit. 100Watts has been mentoring the Jiffi founders for several years as part of its portfolio, when they were developing checkout solutions branded BillerX, under the company Frozen Lake Technology Pvt. Ltd.
The Jiffi brand name though is being launched through Natzu Technologies Pvt. Ltd., a new company the young entrepreneurs have formed to specifically launch the unmanned stores.
Other details
Jiffi’s format will be that of a convenience store along the lines of the Japanese Konbini stores and will house 100 SKUs.
“Right now, we are completely focusing on FMCG—a mix of daily essentials, like food, ready-to-eat foods, beverages and snacks among other things. It’s meant for people to do their impulse buying like masala,” explained Raut. Slowly, the plan is to stock imported items and serve as a showcase for local entrepreneurs.
The store has been put with an investment of Rs 15 lakh, which the founders have raised from their savings. “In addition to this, we have kept aside a corpus to cover operational costs for two years,” said Raut although he is hopeful of breaking even in 12 to 15 stores.
Plans
To speed up break-even, the trio plans on opening five stores in Pune in the next three months, which will average out the costs. The stores will be in areas that have a 24/7 culture—near IT and BPO hubs that run around the clock. The first store too is in a building that has tenants with 24/7 operations.
However, Aggarwal and other mentors at 100Watt feel that there is potential for the technology to be packaged and sold to other retailers rather than going the retailer route, as the team does not have enough retail experience.
But the young entrepreneurs want to scale up and open stores across the nation and even beyond.
“We want to go pan India. And in the future, we can go international as well because Asia will need innovation,” said Raut adding that the company plans to seek external investment to fund its expansion and growth plans.
This is not the first time such a store has been launched in India. In 2017, HyperCity a hypermarket by the Shoppers Stop, had opened two cashierless stores. The stores located at the Infosys campus in Hyderabad were powered by a Bengaluru-based startup. However, they soon closed down.
Then in 2018, a Kerala-based startup opened Watasale, an unmanned store similar to Jiffi, which received wide attention, including that of Amazon, which quietly acquired it and shut it down. Founders were offered jobs at Amazon in the US. Raut said they would like to keep Jiffi alive and not go the Watasale way should they get such offers but are keeping an open mind.
Online grocery retailer Bigbasket too had announced plans to launch 10 such stores in November 2020. However, they did not materialise either.
So far, attempts have been made to launch such stores, but none have survived.
“The problem with this technology is that there is a very high cost of capex cost because every inch of the store has to be covered with sensors and cameras—roughly around $60 to $70 per sq. ft. and that’s only for all the technology, not fittings and all. Hence, we tried a 500 sq. ft. store,” added Aggarwal.
Will they succeed?
Today, the technology available is much different from what was available even a couple of years back.
“Since the last two-three years, we have seen so much improvement in technology that the chances of that technology not working have gone down dramatically. So, from a technology perspective, it should work,” said Ranjit Satyanath, former CIO of Shoppers Stop.
However, he does not expect everything to work without a hitch, initially. “There will be some rough edges, which is the case with any technology that you deploy. When you put out a technology, customers interact with it in ways that you have never been able to imagine. I’m sure they will discover a lot of such parts and fix them,” Satyanathh added.
Also, while the tech may seem to work fine, Satyanath feels it’s too early to say if Jiffi will work as a business. Whether it can go to the next level, can only be determined in about three to four months of operationalizing the store.
“If one store works, it will attract, influencers, media attention and investors, which they can leverage to open multiple stores,” the retail tech veteran said.
Will it set a trend?
Often disruptors set trends, inspiring others to follow. Will the Jiffi founders be the poster boys of the success of unmanned retail in India, triggering the next big trend?
“I am unsure if unmanned stores will be the next big thing. Amazon, which pioneered the concept and tech itself is shutting its Amazon Go stores,” said retail experience design curator Surender Gnanaolivu, who works with several new-age and established retail brands to open tech-enabled stores.
“That said, offering ultra convenience with tech-enabled self-checkout and personalized information and insights is what is being experimented with,” he added.
