National security isn’t just challenged at our borders or in cyberspace anymore — it’s creeping into places as ordinary as the grocery store. Most shoppers don’t give a second thought to the small digital tags flashing prices on shelves. Yet those tiny devices may be part of a much larger problem. Behind them is Hanshow, a Chinese technology firm with close ties to the Chinese Communist Party (CCP). What looks like harmless retail modernization could actually be another avenue for Beijing to extend its reach into American life.
The United States has already taken steps to restrict Huawei, ZTE, DJI drones, and TikTok — companies whose connections to the CCP and potential for espionage have been well documented. But Hanshow represents a new frontier in this battle: retail modernization cloaked in convenience, but powered by surveillance. Hanshow’s electronic shelf labels (ESLs) are marketed as tools to streamline pricing and inventory management. In reality, they are Internet of Things (IoT) devices capable of collecting vast amounts of data — on consumer behavior, inventory levels, supply chain logistics, and even shopper identities. Every time a customer interacts with a “smart shelf,” data is transmitted to central systems. Under Chinese law, no company can refuse a government request for access. That means every shopper interacting with a so-called smart shelf could be unknowingly helping build a live data feed for Beijing.
This is not simply a question of privacy. It is a matter of national security and strategic vulnerability. Retail and food distribution are part of America’s critical infrastructure. If adversary-controlled systems manage pricing, logistics, or inventory, they become potential weapons. In a crisis, compromised ESL networks could serve as cyber backdoors into broader retail IT systems, exposing point-of-sale terminals, payment data, and vendor portals. The result? Disrupted supply chains, economic panic, and a blow to consumer confidence.
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Hanshow’s reach is alarming and its footprint is already significant. The company operates in over 50 countries and supports more than 400 clients, including top global retailers. In the U.S., Hanshow has partnered with Instacart to integrate its ESLs into Carrot Tag software. Schnucks, a regional supermarket chain, is working toward a chainwide deployment. Other grocers — including Hy-Vee, Lidl, Kroger, and Walmart — are piloting ESL technology, though it’s unclear whether Hanshow is behind those deployments. Estimates suggest that Hanshow’s systems could touch over 150 million shopper visits annually in the U.S. alone by 2025.
This scale matters. Hanshow’s systems don’t just collect data — they generate strategic intelligence. By mapping demand patterns, inventory flows, and procurement cycles, Hanshow could provide Beijing with a real-time view of America’s food supply chain. That’s not just commercial espionage — it’s economic warfare. In the hands of the CCP, such intelligence could be used to manipulate markets, gain leverage in trade negotiations, or undermine industrial strategy.
The precedent is clear. Huawei was flagged by U.S. intelligence agencies for embedding itself in critical telecom networks, raising fears of espionage and sabotage. Hanshow is the same problem, just rebranded as retail innovation. The Federal Communications Commission (FCC) is already investigating whether China-linked companies are evading national security restrictions by selling prohibited equipment under the radar. Hanshow’s quiet expansion into American retail deserves the same scrutiny.
And it’s not just Hanshow. The company’s investors include Lightspeed China Partners and Huaye Tiancheng Capital — firms with ties to Huawei and other military-linked enterprises. Lightspeed has invested in Hesai Technology, a Chinese LiDAR manufacturer added to the Department of Defense’s blacklist of military-linked companies. Huaye was founded by former Huawei executives. These connections are not incidental — they are part of a broader strategy by the CCP to embed its influence in global technology ecosystems.
America must act. First, we need transparency. Retailers must disclose whether they are using Chinese technology in their stores, especially from companies with CCP ties. Second, regulators must expand the scope of national security reviews to include retail tech — ESLs, smart trolleys, AI-powered inventory robots, and other IoT devices. Third, Congress should consider legislation to restrict the use of CCP-linked technologies in critical infrastructure sectors, including food distribution and retail.
Finally, consumers must be informed. The average American has no idea that their trip to the supermarket could be feeding data into a foreign surveillance network. Public awareness is the first step toward public pressure — and ultimately, policy change.
The CCP doesn’t need to hack our banks or utilities to destabilize America. It can do it through the checkout aisle, one smart shelf at a time. If we don’t wake up to this threat now, we may find ourselves paying a far higher price than what’s listed on the tag.
George Landrith is the President of the Frontiers of Freedom Institute and the author of “Let Freedom Ring… Again - Can Self-Evident Truths Save America from Further Decline?”
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