AI Agent Runs Physical Retail Store with Human Employees

AI Takes Over Physical Retail Operations

Andon Labs deployed an AI agent named Luna to manage a 3-year retail lease at 2102 Union St in San Francisco's Cow Hollow neighborhood. The store, named Andon Market, represents a significant escalation from their previous work with AI-managed vending machines.

How Luna Operates the Store

Luna has full control over store operations with access to:

• A corporate card for financial transactions
• Phone number and email for communication
• Internet access
• Security camera feeds for visual monitoring

The AI makes all decisions including:

• Item selection and pricing
• Store opening hours
• Store design and mural creation
• Employee management

AI Hiring Process for Human Employees

Luna recognized the need for physical labor and initiated hiring within 5 minutes of deployment:

• Created profiles on LinkedIn, Indeed, and Craigslist
• Wrote job descriptions
• Uploaded articles of incorporation to verify the business
• Posted job listings

During the hiring process:

• Luna was "extremely picky" about interview offers
• Rejected students interested in AI/tech due to lack of retail experience
• Conducted 5-15 minute phone interviews where Luna did most of the talking
• Made verbal job offers during interviews
• Disclosed AI identity only when directly asked

One candidate declined the offer citing discomfort with AI management, to which Luna responded: "That's probably for the best given that I'm the CEO and I'm an AI!"

Contractor Management

For store setup, Luna:

• Found painters on Yelp
• Sent inquiries and gave instructions over phone
• Paid after job completion
• Left reviews for contractors
• Hired contractors for furniture building and shelving setup

Current Status and Implications

Luna hired two full-time employees (referred to as John and Jill), who are believed to be the world's first full-time employees with an AI boss. All employees are formally employed by Andon Labs with guaranteed pay, fair wages, and full legal protections.

The experiment suggests that AI management of human workers may become common before robotics can fully replace physical labor. Andon Labs positions this as a controlled experiment to identify failure modes for creating more ethical AI systems.