Smarter sari-sari stores equipped with artificial intelligence might come to a place near you.
The Department of Science and Technology has granted Filipino startup firm Packworks — which offeres business-to-business (B2B) fast-moving consumer goods (FMCG) marketplace for sari-sari stores — a Php 3.5 million research funding for its project.
This is to leverage Artificial Intelligence (AI) and equip over 1.3 million sari-sari stores in the Philippines with data-driven inventory management tools that would help enhance business growth.
The grant from the DOST-Philippine Council for Industry, Energy and Emerging Technology Research and Development (PCIEERD) Startup Grant Fund (SGF) Program will be added to Packworks’ Php 1.5 million allocation to develop a machine-learning-powered precision marketing model, offering sari-sari stores customized recommendations on sellable items and promotions from Packworks’ FMCG partners.
Science and Technology Secretary Renato U. Solidum, Jr. expressed his support for the project.
“Our mission at DOST is to build an integrated, inclusive and sustainable startup ecosystem. We hope to support startups at every stage of development, from formation to validation, until growth,” he said.
The SGF Program aims to support technology-based startups by transforming early-stage technologies into market-ready products and since July 2022, the DOST has supported 123 startups in the country through the said program.
Packworks’ collaboration with DOST will run for 18 months with the aim of reaching more micro-retail stores across the country and enhance their digital capabilities.
While daily essentials are provided to 94% of Filipinos by sari-sari stores — which then make up 99.5% of all micro, small, and medium-sized enterprises (MSMEs) — Packworks said that it aims to solve problems like inadequate financial management, lack of actionable customer insights, and ineffective promotional campaigns.
“Through this AI-powered model we will develop in partnership with DOST, we aim to equip small entrepreneurs with data-driven insights and targeted strategies for enhanced business success and expansion,” said Packworks Chief Data Officer and project lead Andoy Montiel.
The AI-powered capability will be launched as an in-app service on Packworks’ Sari.PH Pro app and is expected to benefit its network of over 270,000 sari-sari stores across the Philippines.
Packworks CEO Bing Tan also shared his optimism about the partnership with government agency, and said: “We are elated to be collaborating with DOST through a shared vision to energize the grassroots retail industry in the country.”
“This public-private partnership will be instrumental in addressing the unique challenges faced by sari-sari stores, providing them with the tools and insights needed to thrive in a competitive and increasingly digitized market. We look forward to leveraging AI-driven solutions to empower these stores, enhance their operational efficiency, and drive economic growth at the grassroots level,” Tan added.
Packworks was launched in 2018 as a solution for multinational companies with only a handful of sari-sari store partners.
It has since rapidly expanded as a B2B platform heavily focusing on its role in the supply chain ecosystem, from small sari-sari store owners to wholesalers, distributors, and renowned FMCG companies and brands.