Microsoft Enters Grocery Tech Market Under Chinese Hanshow Deal
A person walks past a Microsoft logo at the Microsoft office in Beijing, China, August 4, 2020.
Thomas Peter | Reuters
BEIJING – MicrosoftThe Chinese branch of China on Thursday announced a strategic partnership with Chinese retail technology company Hanshow to collaborate on cloud-based software for store operators around the world.
The deal marks Microsoft’s latest foray into a retail industry that’s forced to accelerate online change. Offline integration with internet selling strategies is known as omnichannel retail, and includes grocery delivery, request for which jumped in the wake of the coronavirus pandemic.
Retail is one of the sectors that has seen some of the biggest disruptions in recent years, Joe Bao, head of China strategy for Microsoft, said at a signing ceremony at the company’s offices. software in Beijing.
The partnership is not only for the Chinese market, but also to bring Chinese technology overseas, Bao said in Mandarin, according to a CNBC translation. He said the deal comes after Microsoft’s five-year collaboration with Hanshow.
The American software company entered China in 1992, where it has its largest overseas research and development center. The strategic partnership comes as US and Chinese companies operate in an increasingly tense political environment that focuses on trade and technology, in part in response to foreign criticism of China’s unfair trade practices.
At present, Hanshow’s main customers are supermarkets in China and Europe.
The company says its products include electronic labels on store shelves that can reflect price changes in real time and a system that helps workers shorten the time it takes to package products for delivery. Hanshow says it also sells a cloud-based platform that allows a retailer to simultaneously see the temperatures of fresh produce in stores around the world.
The partnership will include collaboration on technology connected to the Internet, or Internet of Things.
As part of the deal, Hanshow will use Microsoft’s Office 365 software such as Word and Dynamics 365, a cloud-based customer relationship management system, said Gao Bo, chief architect at Hanshow, during an interview with CNBC after the signing ceremony. He said the two companies can share their global network of customers and will jointly launch a research and development team.
Founded in Beijing a decade ago, Hanshow lists offices in Germany, France, the Netherlands, Denmark and Australia on its website. Hanshow has just established a branch in the United States, according to the company.
Globalization is one of Hanshow’s important business strategies, Gao said in Mandarin, according to a CNBC translation. He said the company’s first step when entering a foreign market was to understand local laws and culture, and that his own work had not been significantly affected by international trade tensions.
“Offline stores are not going to die out,” Gao said, adding that “the uncertainty in the future is what the ratio will be.”