Cashierless grocery concept has 30 new locations in the works
Aisle 24, a cashierless, grocery and convenience market that’s open 24/7, is set to grow its footprint across Canada.
The company, which opened its first location in 2016, currently has nine stores in the Greater Toronto Area and Montreal. Through a franchise model, an additional 30 stores are in the queue for Ontario, Quebec and British Columbia. The company plans to add locations in Alberta, Manitoba, Nova Scotia and New Brunswick over the next two years.
Aisle 24 has two store formats. The first is the resident format, which ranges from 300 to 700 square feet and is located within apartment buildings or condominiums and is only accessible by the building residents. The second is the community format, which is around 1,000 square feet and is located in standard retail space and is open to the general public.
The stores carry grocery and household products, including dry goods; frozen goods; confectionery and snacks; a fresh offering including sandwiches, soups and salads; dairy products; and some produce, depending on the location. (Photo gallery below.)
“Our strategy around our product mix is very much tailored to the demographic of the location,” says John Douang, co-founder and CEO of Aisle 24. “For example, our first location at Centennial College is geared towards the student base. They love frozen pizza and ramen noodles. In our standard markets in condominiums where we’re servicing young professionals and families, we also provide more personal hygiene and home cleaning products, as well as family-sized food products.”
In terms of accessing the unattended stores, Douang says Aisle 24 is members-based so no one can just walk into the store. “They need to download our mobile app and create an account... and they use a mobile button to unlock the door.” Once they’re done shopping, members use a self-checkout to scan and pay for their times. An analytics and security system helps prevent theft.
Douang says the longer-term plan is to open more than 200 locations in Canada over the next few years, but feels the market can support thousands of Aisle 24 stores. He notes that Aisle 24 has financial backing to support its expansions plan: a major investor and advisor is Wes Hall, the newest “dragon” on CBC Dragons’ Den.
“The gap in the market is related to a lot of the independent convenience stores and small grocers throughout Canada,” says Douang, who worked in his parents’ convenience store in Toronto when he was young, and then went on to work in the technology sector before co-founding Aisle 24. “The product offering was inconsistent from store to store and pricing was all over the board.” In addition, smaller-format stores were focused on items such as tobacco, which Douang notes is a declining industry, and lottery, which is increasingly going online. (Aisle 24 sells neither.)
“Most of these stores have to be open 12 to 14 hours a day, and with labour costs, it’s a very long day [for independent retailers],” he says. “There is this opportunity now to enhance [the concept] and make the operations of the business more efficient by utilizing technology.”
On that note, people have criticized Aisle 24 for the “loss of jobs,” which Douang acknowledges is a touchy subject. However, he says, “while we are not employing cashiers at our stores, we have warehouse workers, delivery drivers, support staff, technology developers, and others who all work on the back end to make this happen.”