Artificial intelligence (AI) is beginning to reshape operations in neighborhood sari-sari stores, enabling micro-retailers to make smarter decisions and improve profitability through data-driven insights, according to new findings from tech startup Packworks.io.

Packworks’ analysis of more than 300 partner stores showed a 46% increase in daily gross merchandise value (GMV) over a two-week period after store data was collected in September 2025. The same stores also reported a 17% rise in total sales, reflecting higher operational efficiency and improved inventory management.

Despite operating 20% fewer selling days—declining from five to four days in two weeks—stores that followed AI-driven recommendations still recorded stronger revenue. Packworks said this indicates that AI can enhance demand planning, optimize product mixes, and help retailers prioritize stock that drives higher returns during their operating hours.

The insights were derived from stores that used Packworks’ Store Insighting Project (SIP), an AI-powered report that turns transaction histories into personalized, actionable recommendations. The analysis showed that sales growth was driven in part by underperforming items identified by the tool, allowing store owners to adjust stock flow and maintain efficiency.

Packworks’ precision marketing tool was developed through the DOST-PCIEERD Startup Grant Fund (SGF) Program, awarded in 2024 to support broader AI adoption among microenterprises. The startup also partnered with ST Telemedia Global Data Centres (Philippines) to run large-scale machine learning models via its AI Synergy Lab, and with Ateneo’s Business Insights Laboratory for Development (BUILD) to establish a comprehensive data warehouse and business intelligence system.

Packworks Chief Data Officer Andoy Montiel said early results show clear benefits for partner stores using their AI tools. “As stores learn to leverage the recommendations from the SIP insights, micro-retailers can make smarter decisions that translate into higher sales and more efficient operations,” he noted.

With only 14.9% of Philippine businesses currently using AI—despite widespread access to computers and internet—Packworks said its goal is to help bridge the adoption gap. Citing estimates that AI could unlock up to ₱2.8 trillion in economic benefits by 2030, Co-Founder Hubert Yap emphasized the need for practical and accessible tools for micro-retailers. “Our mission is to make AI usable for even the smallest sari-sari stores,” he said.

Packworks’ initiatives align with the Philippine Development Plan 2023–2028, which highlights digital transformation and emerging technologies as drivers of industry revitalization and economic resilience.

For more studies and data insights on sari-sari stores, visit Packworks.io or follow Packworks on Facebook.