Notable Chinese retailtech firms are small in size, heavy on IT personnel, and largely located around the Beijing-Tianjin-Hebei and Yangtse Delta region, according to a new report.
The study was released by international audit, tax and advisory firm KPMG in partnership with the China Chain Store & Franchise Association to identify the top 50 high-growth retailtech enterprises in China. It recognises firms that work to bring forward digitalisation, intelligence and integration.
The findings showed that consumer technology applications are more concentrated on front-end interaction with consumers, marketing and transactions, consumer operation and smart technology companies.
Most of the companies shortlisted for the report had no more than 300 employees.
Technical personnel account for more than 60 per cent of human resources in more than half of these firms, and about half of the companies have been operating for less than five years.
“The association and KPMG have worked together to release the list of China’s leading 50 retailtech enterprises, after spending six months studying the founding team of candidate enterprises on a one-by-one basis over six criteria, namely: technology and business model innovation; empowering reform of the traditional retail sectors; financial health; valuation and capital market recognition; target market acceptance and potentials under market segmentation; team capabilities and corporate innovation mechanism; and business model innovation and sustainability,” said China Chain Store & Franchise Association secretary-general Kevin Peng.
At the end, 64 representative Chinese retailtech firms were shortlisted, including 50 leading enterprises and 14 emerging enterprises.
“We hope this list can offer some references to chain stores and retail brands so that their digital transformation journey can be smoother and more successful.”
“The retailtech industry is treading the same path of evolution as China’s commerce, the two have formed a synergy for mutual growth,” said KPMG China partner and head of consumer retail Jessie Qian.
“Enterprises in technological innovation and retail industries have worked hard to accumulate a wealth of technological applications and real-life cases, which can serve as role model for enterprises building their own digital capabilities.”
“The retail industry is innovating and reforming in the face of digitalisation as consumers are changing their lifestyle,” said KPMG China partner and advisory head of consumer and retail sector, Michael Mao. “New retail technologies and the retail businesses are increasingly integrated, as new consumption needs are being explored and new operational models are emerging.
“During the transformation, retailtech enterprises, especially start-ups, have played an indispensable role and they are upgrading themselves when engaging with their end-users. Many technological enterprises have evolved from software vendors of a single solution to business partners working with their end-users to develop solutions tailored for specific scenarios, others not only provide technical support for hardware and software, but also assist retail enterprises in integrating technological transformation at the IT level with internal reform and optimisation of organisational structure.”