Keeping up with the latest store closures, emerging tech, and what Amazon is doing could easily be a full-time job. Luckily for you, it’s ours.
This week, we’re looking at the up-and-coming trends in retail and logistics that we think will shape the future of the industry, including:
- The rise of retail-as-a-service
- Intelligent automation
- Virtual reality in the supply chain
Retail-as-a-service is on the rise
Making the leap from online-only to a physical retail space is a big deal. There are fixed costs, capital expenditures, and with the constant news cycle of retail stores going under, it can feel like a really risky move. Enter: Retail-as-a-service.
A number of new companies are now offering a way into physical retail for a flat monthly fee. They take care of the leases, staffing, and other processes, and brands can avoid ongoing fixed costs and the other risks of opening a physical store themselves.
b8ta, Leap, Re:Store, Fourpost, Neighborhood Goods, and Bulletin are all businesses operating on this retail-as-a-service model, and as more direct-to-consumer brands seek ways to break into the physical space, it’s poised to grow more in the years to come.
Why should legacy retailers care? Because they can take advantage of this business model to test out new retail formats and build out pop-up events, while avoiding the fixed costs that, in the past, became debts they couldn't pay back.
What do you get when you combine AI and automation?
The answer is the latest trend in the logistics industry: Intelligent Automation. Artificial intelligence—the machine simulation of human intelligence—combined with automation—the use of automatic equipment in manufacturing and production processes—enables machines to learn, make autonomous decisions, and provide recommendations. Which, in turn, enables businesses to increase efficiency and reduce costs.
Retail execs have high hopes for it. In a survey of 1,900 consumer products and retail executives, the National Retail Federations (NRF) discovered that respondents expect intelligent automation to reduce operating costs by 7% and increase annual revenue growth by up to 10%.
Practical applications for intelligent automation include everything from “automatically rerouting shipments to bypass bad weather, to personalizing in-store services based on analysis of a customer’s facial expressions.”
If you’re not already incorporating it into your supply chain strategy, you will be soon. According to the NRF, “two in five retailers and brands are already using intelligent automation, and that number is on track to double within the next three years.” The future is automated.
Virtual reality in the supply chain
Virtual reality (VR) has moved from a gaming trend to something that basically every industry is beginning to adopt, and the supply chain is no exception. Deloitte identified uses cases for VR at every stage of the supply chain, from development all the way to sales.
- Develop: VR can reduce costs in product development process through virtual prototypes.
- Plan: VR allows users to interpret data sets across more dimensions for more accurate planning and forecasting.
- Connect: VR gives teams enhanced virtual communication abilities that allows for greater collaboration across teams.
- Build: Instead of training on advanced supply chain machinery, VR provides a safe simulated learning environment.
- Deliver: VR applications can be used to help with remote assistance during equipment repairs and can enhance virtual communication during delivery.
- Sell: VR can enhance sales experiences by providing new insights into customer preferences, which can then be used to inform product development.
The time is now to invest in VR. The VR market is expected to reach nearly $50 billion by 2025. Businesses who wait until then to implement will be at a huge competitive disadvantage.
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For more on the future of retail and logistics, check out our Future of Commerce and Future of Supply Chain collections! Hear from retail and supply chain leaders on what they think is next for the industry.
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