backgrounds
The company provides digital retail solutions for retailers in the local retail industry. Local retail is the business of selling products to nearby consumers through offline or online channels. The company mainly provides solutions in the Mainland and has successfully expanded its business to other countries and regions in Asia, including Hong Kong Special Administrative Region, Cambodia, Singapore, Malaysia, Macau Special Administrative Region, Indonesia, the Philippines and Brunei. According to Frost & Sullivan's data, in 2023, in terms of revenue, the company was the largest retail digital solutions provider in the Mainland, with a market share of 6.5% and the third largest retail digital solutions provider in Asia, with a market share of 4.2%. A retail digital solutions service provider refers to a company that provides digital products and services aimed at enhancing and digitizing the operations of local retailers.
summary
The company has a number of large corporate customers: the company provides services to other major retailers, such as Chongqing Department Store Group (one of the associated parties), Yinchuan Xinhua Group (one of the associated parties and controlled by Dr. Zhang), and well-known brands such as Wellcome, Wanning, Guardian, Giant and 7-Eleven (Hong Kong) operated by DFI Retail Group. The company currently covers all major retail businesses, such as convenience stores, department stores, supermarkets and specialty retailers, to help the company's ever-expanding customer base meet ever-changing market challenges and provide high-quality services to consumers. The company has served 236, 436, 533 and 444 customers for the year ended December 31, 2023 and the six months ended June 30, 2024.
Retail core service cloud enhances operational efficiency: The company's retail core service cloud (including the company's proprietary Dmall OS system and AIoT solutions) integrates various functions to help retailers digitize and optimize operations. Under the company's Dmall OS system, the company provides various service modules to help retailers digitize all key aspects of their operations, from procurement, supply chain and warehouse management to product display and store operations.
The market still has potential: According to Frost & Sullivan data, the digitization rate of local retail sales in the Mainland and Asia in 2023 was 3.1% and 4.5%, far lower than the 13.3% in the US. In 2023, the digitization rate for other industries in the Mainland (such as e-commerce, catering and transportation) was 7.7%, 5.1% and 7.1%, all significantly higher than 3.1% of the local retail industry. As demand from local retailers continues to rise, their digital IT spending is projected to increase at a compound annual growth rate of 5.7% from 2024 to 2028, compared to 2.6% in the US during the same period.