September 5, 2024
Digital Garage, Inc.

NEWS RELEASE
Digital Garage Provides “Pangaea Delivery” to SATUDORA,Becomes Japan’s First Quick Commerce-Enabled Retail Tech Service〜Centralized Online Order Management to Meet the Demands ofCustomers’ Ordering and Picking Processes〜-Digital Garage, Inc. (DG) implemented functional enhancements to its SaaS “PangaeaDelivery” to improve the operational efficiency of retail businesses and strengthened its
deployments as Japan’s first Quick Commerce-enabled retail tech service *1 for retailcompanies.

-SAPPORO DRUG STORE CO., LTD. implemented the “Pangaea Delivery” system at 104
stores after conducting a PoC.

■ Background and History
Against the changing lifestyles of consumers in recent years, online sales businesses utilizing variouschannels have been expanding among physical stores, such as online supermarkets, drive-thru, BOPIS(Buy Online Pick-up In Store), and so on. This is particularly obvious in Quick Commerce (quick delivery),which is growing at a compound annual growth rate of 25.1% and is expected to expand to approximately$225 billion by 2028 *2.

While Quick Commerce has enabled many businesses to expand sales and gain access to consumers
through various sales channels, it has also created increasing pressure on business management andFor inquiries regarding this release, please contact：dg4819.pr@garage.co.jp

September 5, 2024
Digital Garage, Inc.

NEWS RELEASE
operations due to each service’s different terminals and operations. In particular, retailers need help withvarious SKUs (Stock Keeping Units), continuous product replacements, and ample store space, delaying
the full-scale introduction of Quick Commerce.

In response to these business issues, DG has been developing functions and expanding systemconnections with external businesses to build “Pangaea Delivery,” a SaaS that enables centralized
management of multiple online ordering services for retail companies and food and beverage businesses*3.

■ Japan’s first Quick Commerce-enabled retail tech service
In addition to the existing centralized online order management, “Pangaea Delivery” has implemented
functions such as support for various SKUs specific to retail businesses and improved data processing
capabilities. Further, besides POS systems, DG is accelerating open innovation with external companies,
including startups, such as system collaboration with retail tech companies that solve various issues forretail businesses.

To introduce this system at SATUDORA (SAPPORO DRUG STORE), DG has linked it with the “pickingsystem” provided by ROMS, Inc. For the introduction of this system at SATUDORA, DG has connected withthe “picking system” provided by ROMS Co. This will enable centralized management and operation of not
only the ordering and status management of multiple delivery services but also in-store picking operations,providing a comprehensive solution to the Quick Commerce service implementation issues faced byretailers.

■ Business challenges in Quick Commerce operations and the solutions provided by “PangaeaDelivery”
The business issues detected through the PoC with SATUDORA and the solutions provided by “PangaeaDelivery” are as follows.

1

Centralized management and operation of multiple online services◎Issues・Order management is complicated because each online service has its management device, withdifferent operating procedures and operation rules.
・Prioritization of orders across online services is difficult to determine, leading to errors and missed

For inquiries regarding this release, please contact：dg4819.pr@garage.co.jp

September 5, 2024
Digital Garage, Inc.

NEWS RELEASEorders.
⇨Solutions with “Pangaea Delivery”
・By enabling centralized management and operation of all online services within a single tablet, in-store
operations are more efficient, reducing human error significantly.

2

Improved picking operation ( finding and collecting products for orders) efficiency◎Issues・In many cases, the packages of products handled in the store are very similar, and mistakes arefrequently made when picking products.
・If picking operations are carried out without considering the shelf allocation of products, the flow line ofstore staff is inefficient, and picking operations are time-consuming.
⇨Solutions with “Pangaea Delivery”
・Picking operations are optimized by presenting optimal picking routes that consider the shelf allocation ofproducts.
・By reading product IDs with a smartphone, human error is eliminated, and accurate product picking canbe performed.

3

Automatic reflection of information on product shortages in the store◎Issues
・Products displayed in the store may become out of stock due to purchases by consumers visiting theactual store. Still, the information linkage to the online service requires individual inventories, which
creates a huge workload.
⇨Solutions with “Pangaea Delivery”
・Immediate identification of missing item status at the time of picking, notification to Quick Commercecustomers, and automatic removal of the item from the product list for all online services.

■ Future roadmap
DG will continue to expand its services for “Pangaea Delivery” to help improve operational efficiency andincrease sales of Quick Commerce for food, beverage, and retail businesses by providing picking routenavigation, POS and inventory linkage, AI-based demand forecasting, and other services. By developing a
new service that enables food, beverage, and retail businesses to conduct out-of-store online sales
business under their brands, as well as providing a payment service, DG will further accelerate its group
strategy, “DG Fintech Shift,” and contribute to the development of Quick Commerce in Japan.

For inquiries regarding this release, please contact：dg4819.pr@garage.co.jp

September 5, 2024
Digital Garage, Inc.

NEWS RELEASE■ Comments
Daisuke Tominaga, Corporate Officer and Head of Corporate Development Division of DigitalGarage, Inc.
DG is pursuing the development of DX services that are highly compatible with DG's core business,payment services, and that solve financial services and industry-specific issues under "DG FinTech Shift," agroup strategy that integrates payments, data, and technology. The progress of “Pangaea Delivery” isintended to support growth and productivity improvement in the food, beverage, and retail industries,
which are facing challenges such as labor shortages and cost increases due to inflation, and we are happy
that SAPPORO DRUG STORE has chosen to introduce this new service. We will further strengthen ourcooperative relationship with related businesses in the industry and offer “Pangaea Delivery” to a diverse
range of retailers, including drugstores, convenience stores, and supermarkets, thereby contributing to theexpansion of the Quick Commerce market in Japan.

Takuto Oi, Corporate Officer and General Manager at Business Strategy Div. of SAPPORO DRUG
STORE CO., LTD.
We are developing our business based on the group concept of “Connecting the community, and Taking
Japan to the future.” One of our important missions is to make our stores O2O. The most important aspectof making your store more convenient and enjoyable for customers is employees' work efficiency andexperience. As a result of this joint development with Digital Garage, we are confident that we havesignificantly improved operational efficiency and work experience in the increasingly complicated 3P quick
delivery order process for employees. We hope that "Pangaea Delivery" will further evolve as manyretailers share it and that this system will contribute to labor savings at business sites due to the declining
population.

*1: As of August 2024, according to Digital Garage research.
*2: Source: The Business Research Company「Quick Commerce Global Market Report 2024」*3: News Release by Digital Garage March 1, 2022 https://www.garage.co.jp/en/pr/release/20220301_02/

For inquiries regarding this release, please contact：dg4819.pr@garage.co.jp