Oser Communications Group

GOURMET NEWS DECEMBER 2018 www.gourmetnews.com NEWS & NOTES 9 Chinese Retailers Continued from PAGE 1 European e-commerce sales, according to Stern. E-commerce sales now account for 20 percent of all retail sales in China, compared to about 9 percent in the United States, Stern said. Alibaba.com is the largest of China'a online retailers, with 617 million monthly users and 552 active marketplace users. For comparison, the current total popu- lation of the United States is just over 325 million people. Alibaba is now the largest merchant in the world, surpassing Walmart in annual sales in 2016. In China's online market- place, Amazon is the third-largest retailer, and eBay is fourth. Alibaba owns a stag- gering number of other businesses, in- cluding Lazada, which focuses on e-commerce in Southeast Asia; AutoNavi, which provides digital mapping and nav- igation technology; Taobao, a consumer- to-consumer auction marketplace similar to eBay; Alipay, the world's largest online- payment system; and Tmall, a Taobao spinoff that's a an online business-to-con- sumer retailer selling to Chinese-speak- ing customers in China, Hong Kong, Macau and Taiwan. Alibaba and other on- line merchants currently make half of all of the country's retail sales of electronics and clothing, and on Singles Day, a sales holiday created by Alibaba, similar to Cyber Monday, China's online merchants made $31.8 billion in sales on a single day. "It's twice the size of Black Friday and Cyber Monday combined," Stern said. Grocery is one category where online merchants don't have the market cor- nered, since only about 8 percent of China's grocery trade is currently happen- ing online, for much the same reasons that online grocery sales have lagged in the U.S. That's about to change, according to Stern. Like Amazon in the U.S., Alibaba and other Chinese online retailers are now learning how to build brick-and-mortar stores that digitize the in-store shopping experience to satisfy customers who still want the multisen- sory experience of the analog world along with the effi- ciencies and speed offered by digital technology. Alibaba is doing that with HEMA, a chain of 10,000 square-foot b r i c k - a n d - m o r t a r grocery stores pow- ered by modern technology, that pro- vides its customers with the experience of selecting their own fresh seafood and produce, scanning their purchases into their account at the same time that they drop it into their cart and then dropping that cart off at a delivery hub where it's delivered to a fleet of scooters and driv- ers in the distribution center at the back of the store for 30-minute delivery to customers who live within 3 kilometers of the store. There are currently 50 of these stores, but plans for more are in the works. The convenience they offer is so powerful an incentive to consumers that proximity to a HEMA store has be- come a driver in the real estate market- place, Stern said. 7FRESH is another grocery retailer cur- rently ramping up its presence in China. It's owned by JD.com, the second-largest online retailer in China, both by transac- tion numbers and sales volume, with more than 300 million active users. Wal- mart and Chinese multinational con- glomerate Tencent both have stakes in JD. 7FRESH stores are larger than HEMA stores – 40,000 square feet rather than 10,000, and they include foodservice as well as grocery retail, so customers can pick out their fresh seafood in the grocery store, have it cooked for them on-site and stay to dine in the store's restaurant. If they just want coffee, a 3-D printer sta- tion can scan their face and reproduce the portrait as coffee foam in their cup. Customers scan into the store to shop, link an automated cart to an RFID chip in a bracelet they place on their wrist, and then their cart follows them around the store. They purchase an item by scanning a QR code with their phone and then dropping it into their cart. That QR code provides them with additional informa- tion about the products they're buying, which may include provenance and nutri- tion information as well as price, and on the other end, it tells the merchant whether they scanned the item and then decided against it or they actually decided to purchase. Payment at the check-out station is made through facial recogni- tion, and then the customer's bag is deliv- ered to a distribution hub at the back of the store. 7FRESH is the only leading re- tailer already to have implemented drone deliveries, other than on a pilot test basis, and it's currently delivering by drone in rural China. What this means for the future of American retail is that models already exist for the retail experiments that are currently under way with Amazon Go, 365 by Whole Foods and Wal- mart's Sam's Club stores. "Walmart is a significant player in this market," Stern said, noting that Walmart intro- duced its Scan, Bag and Go technology a year ago in Walmart stores and then, three months ago, announced that the company was shutting down that pro- gram in Walmarts. The company has, however, accelerated the use of that tech- nology in Sam's Club and is now imple- menting it in Sam's Club Now. ALDI has the ability to emulate HEMA next, because the stores are smaller than traditional supermarkets, and they have limited SKUs and the ability to put a dis- tribution center behind the store. "Today, they're partnering with Instacart, but could they do this on their own in the fu- ture? Quite possibly," Stern said. Alternatively, we could see HEMA or 7FRESH enter the market in the U.S., Stern added. "One of these is currently shopping for real estate in the U.S." GN Rich Dachman Recognized for Attracting Talent to Produce Industry Sysco Corporation Vice President of Pro- duce Rich Dachman was recognized for his longtime commitment to attracting talent to the fresh produce and floral industry, re- ceiving the Center for Growing Talent's (CGT) inaugural Jay Pack Cultivating Our Future Award on October 17. The award was presented at CGT's Contributor and Volunteer Reception, held in Orlando, Florida, in conjunction with Produce Mar- keting Association's (PMA) 2018 Fresh Summit Convention & Expo. The award was presented by its name- sake, Jay Pack, and CGT Vice President Tal- ent Portfolio Alicia Calhoun. On hand for the award presentation was an appreciative audience of industry members, volunteer leaders and staff from CGT and PMA, a Sysco delegation, and – fittingly – dozens of university students participating in CGT's Career Pathways program at Fresh Summit to learn about industry careers. Dachman's colleague Nancy Johnston re- ceived the award on his behalf, after Dachman's air travel was delayed. An industry leader and influencer who is well known to both the fresh produce and the foodservice communities, Dachman also actively participates in or supports programs that attract and develop industry talent. For example, he has mentored Ca- reer Pathways students at Fresh Summit every year since 2008. Sysco FreshPoint has gone on to hire several Career Path- ways students, and Dachman remains a mentor to many of his now-industry col- leagues. "Rich personifies what this award stands for. He works tirelessly not only to increase access to fruits and vegetables, but also to invest in the future of our industry's talent – as a mentor, as a recruiter, as an advocate for young people and women in our indus- try," said CGT's Calhoun in presenting the award to Dachman. "Rich never turns down an ask from a member of the industry for a sit down or a call for coaching and mentoring," said Johnston as she accepted the award for Dachman. Johnston is Sysco's Senior Sales Manager, Produce; she also co- chairs CGT's Women's Fresh Perspectives Committee, which guides CGT's women's programming. "He is also a great sup- porter of women in our industry." Sysco FreshPoint is a longtime major sponsor of Women's Fresh Perspectives program- ming. 'I could not be more proud to receive this recognition," stated Dachman. "The students teach me more than I could ever instill upon them. For me, this is what it is all about. I be- lieve when you make an investment in people, it continues to pay off long after you are gone. To be rec- ognized for this important and re- warding work is so humbling. Thanks to Sysco for the continued support in this en- deavor, and thanks to Center for Growing Talent for allowing me the opportunity." The Jay Pack Cultivating Our Future Award was created earlier this year to rec- ognize an industry member each year who is striving to attract talent by sharing their passion for and insights about industry ca- reers, and to encourage others to do the same. The award is named for Pack, for- mer CEO of Standard Fruit & Vegetable Co., who with then-PMA CEO Bryan Sil- bermann envisioned a new program to at- tract top university students to industry careers. The first Career Pathways, then sponsored by the Pack Family Founda- tion, was held at PMA's Fresh Summit in 2004. Career Pathways is a great indus- try success story; to date, more than 1,000 university students have par- ticipated in Career Pathways; about two-thirds took jobs or internships in the industry, and about three- quarters of those remain in the in- dustry today. The Jay Pack Cultivating Our Future Award is one of two talent-centric leader- ship awards offered by Center for Growing Talent. The other is the Women's Catalyst Award, awarded at CGT's Women's Fresh Perspectives Leadership Breakfast on Octo- ber 20. Center for Growing Talent is a charitable nonprofit organization. CGT's work is made possible by generous donations of vi- sionary industry leaders who want to show their commitment to industry talent and to give back to their industry. To learn more, visit www.centerforgrowingtalent.org. GN Like Amazon in the U.S., Alibaba and other Chinese online retailers are now learning how to build brick-and-mortar stores that digitize the in-store shopping experience.

• Cover