Aisle 24 Self-Service Chain Eyes US Expansion

A grocery-convenience store hybrid that has developed a cashier-less retail format for underused ground-floor space in residential buildings in Canada is preparing to test the concept in the United States.

Aisle 24 thus far has introduced two versions of its small-format grocer/convenience store model: one is being used to convert underused ground-floor space in residential buildings. Customers use the Aisle 24 app to access the store and then use in-store kiosks to pay.

More recently, Aisle 24 added a format that uses traditional ground-floor retail spaces that are accessible to the public.

The Toronto-based company’s Resident Markets occupy space within residential buildings, typically ranging from 300 to 900 SF. The locations of the markets within buildings can vary, including the main level, basement or an amenity area.

The more traditional retail units, known as Community Markets, are designed for standard CRE ranging from 1,000 SF to 1,800 SF. These units occupy ground-floor retail space and provide more visibility to walk-by and drive-by traffic.

According to a report in GroceryDive, the company is targeting a demographic, said to include Gen Z and millennial customers, that likes to ship quickly and embraces functionality and self-service business models.

The 24-hour self-service model also reduces the company’s workforce requirements. Aisle 24 has been opening self-service stores in Ontario and Quebec at a rapid clip.

The company’s current focus is on Toronto, which it sees as a model for an expansion into NYC due to the density of high-rise residential towers in Toronto.

Aisle 24 stores carry grocery like meat, pasta and produce, but do not carry restricted items that require age verification, like tobacco and alcohol.

According to GroceryDive’s report, about 10%-15% of each store’s assortment is crafted to meet its customer demographic, with franchise operators doing statistical research regarding the age range, median income and ethnic background of the neighborhood.

Aisle 24’s model relies on franchise operators who travel between stores, spending a few hours at each one at least three times a week for cleaning and stock replenishment. Some of the busy stores have operators on-site every day for a few hours, the report said.

For security, the company uses Axis Communications’ turret-style and height-strip cameras to monitor customers in the stores, a technology that also allows Aisle 24 to determine its store traffic amounts.