AI tools are reshaping micro-retail operations as early adopters report sharper inventory decisions and higher efficiency
Artificial intelligence (AI) is beginning to make a measurable impact on the country’s micro-retail sector, with sari-sari stores using AI-driven insights reporting significant improvements in sales and operational efficiency, according to new data from tech startup Packworks.io.
In its latest analysis, Packworks found that sari-sari stores that used its AI-powered Store Insighting Project (SIP) saw a 46% increase in daily gross merchandise value (GMV) over a two-week period following data collection in September 2025.
The boost in GMV translated to a 17% uptick in overall sales, underscoring how data-backed recommendations can influence store performance even in hyperlocal retail environments.
Fewer selling days, higher sales
One of the study’s most notable findings: stores that adopted AI recommendations earned more despite operating on 20% fewer active selling days, dropping from five to four days across the two-week window.
Packworks said the results point to AI’s ability to help micro-retailers optimize inventory, refine product mixes, and manage demand with greater accuracy — allowing store owners to maximize revenue during shorter operating hours.
The findings were based on data from more than 300 stores within Packworks’ network. By comparing pre- and post-engagement performance among stores that accessed SIP, the company quantified how AI-generated insights directly influenced decision-making and sales outcomes.
Packworks added that much of the sales lift came from underperforming SKUs identified by the AI model, enabling store owners to move stagnant stock and maintain operational efficiency.
Building the infrastructure for micro-retail AI
Packworks’ precision marketing and analytics engine was developed through the Department of Science and Technology’s (DOST-PCIEERD) Startup Grant Fund (SGF) Program in 2024.
The company also tapped ST Telemedia Global Data Centres (Philippines) to run large-scale machine learning models via its AI Synergy Lab, and partnered with Ateneo’s Business Insights Laboratory for Development (BUILD) to develop a centralized data warehouse and advanced business intelligence tools.
“Even at this early stage, we’re already seeing increased sales and improved operational efficiency among stores using our AI tools,” said Packworks Chief Data Officer Andoy Montiel. “As sari-sari store owners continue to engage with AI-driven recommendations through SIP, they can make smarter decisions that translate into better margins and more efficient day-to-day operations.”
Closing the AI adoption gap
Despite AI’s potential to unlock an estimated ₱2.8 trillion in economic value by 2030, a study by the Philippine Institute for Development Studies (PIDS) found that only 14.9% of local businesses currently use AI tools. The gap persists even with broad access to computers and the internet, suggesting that many enterprises lack practical, accessible use cases.
Packworks Co-Founder Hubert Yap said the company aims to bridge this divide by making AI “practical, accessible, and useful” to the smallest retailers in the country.
“Our mission is to equip sari-sari store owners with technology that was once available only to large companies,” Yap said. “This latest innovation shows how AI — when paired with the right partners — can drive sustainable growth for neighborhood stores across the Philippines.”
Aligning with national digital transformation goals
Packworks’ push to integrate AI into micro-retail operations supports the Philippine Development Plan 2023–2028, which identifies digital transformation and emerging technologies as key levers for improving efficiency and revitalizing industries.
The company, which began in 2018 as a passion project among founders Bing Tan, Ibba Bernardo, and Hubert Yap, has since grown into a B2B platform supporting stakeholders across the fast-moving consumer goods (FMCG) supply chain. With an estimated 75% of sari-sari stores owned by women, Packworks also positions its platform as a tool for empowering female micro-entrepreneurs.
For more insights into sari-sari store data and trends, visit Packworks.io or the company’s official Facebook page.
