Fri, Jun 10, 2005 - Page 10 News List

Hypermarket tries out drive-through model

HYPERMARKET Shoppers visiting RT-Mart's new Taoyuan outlet can input an order on a touch screen outside the store, and staff will deliver it to their cars

By Jackie Lin  /  STAFF REPORTER , IN TAOYUAN

A woman chooses the items she would like to purchase from a touch screen at RT-Mart's new drive-thru outlet in Taoyuan yesterday.

PHOTO: JACKIE LIN, TAIPEI TIMES

RT-Mart (大潤發), Taiwan's second-largest hypermarket chain, is experimenting with a brand-new business model designed specifically for its 24th outlet, based on fast-food restaurants' drive-through concept.

The new outlet, launched yesterday in Taoyuan, allows consumers to avoid spending time searching for commodities, greatly reduce queuing time, RT-Mart president Kaufmann Wei (魏正元) said at a press briefing in Taoyuan yesterday.

Taking up less space than other hypermarket stores, the newly opened outlet only has a 300 ping (990m2) warehouse, which stocks 700 to 1,000 items of various brands, ranging from fresh foodstuffs, bread and canned food to cigarettes and tissues.

After parking in one of 10 parking spaces beside the warehouse, shoppers get out to choose products using a touch screen, and then pay their bill. Within minutes, RT-Mart staff will come out, pushing carts loaded with the items and load them in the shopper's vehicle.

"Their average stay here is only 10 minutes. It's very suitable for white-collar employees who have little time for shopping," said project leader Terry Hsu (徐庭惠), who spent two years bringing the concept to life on an initial investment of NT$20 million (US$645,000).

Citing surveys conducted last year by research firm ACNielsen Taiwan, Hsu said Taiwanese shoppers are most concerned about whether hypermarkets are easy to reach, close to their home, and whether it is easy to find the products they want.

"Although hypermarkets offer the cheapest commodities, consumers still frequent convenience stores, where prices are higher, simply because it is convenient," Hsu said.

Based on this behavior, RT-Mart concluded that, "If hypermarkets can offer enhanced convenience, they can boost competitiveness."

Wei said that during the first six months, it would focus on adjusting the product mix to best satisfy the needs of this consumer segment. If the model works, the company will introduce it into downtown areas in Taipei next year, where the population density is higher and large plots of land are not easy to obtain, Wei said.

"I believe this convenient hypermarket type will deal a blow to supermarkets," he said.

Based on this model, RT-Mart also plans to roll out e-commerce shopping next year, further shortening the shopping time.

Jennifer Wang (王琇姿), associate director at ACNielsen Taiwan's retail measurement services, said retailers who are willing to test different business models -- a reflection of changing lifestyles -- deserve encouragement as they offer consumers more choices.

But this innovative design might face difficulties in changing shopper behavior as, generally speaking, consumers prefer seeing, touching and comparing products, especially fresh foodstuffs, before making a purchase.

Retail analysts from the local branch of Hong Kong-based Synovate Ltd (思緯市場資訊) echoed her view.

"Usually visiting hypermarkets is deemed as a family activity on the weekend. Now it will turn into a weekday activity for salaried people or career women; it will take time to see the market's response," said Christine Huang (黃意婷), project manager at the research firm.

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