How artificial intelligence is reshaping commerce
Traditional and new-school retailers alike are using AI and robotics to automate various parts of the retail chain, from manufacturing to last-mile delivery.
After all, corporations in every industry are scrambling to adapt and integrate artificial intelligence into their products — and retail is no exception.
The need for a change in strategy is being underscored by the record rates at which many US retailers are shutting down.
In 2017 alone, 21 retail chains applied for bankruptcy, including high-profile names like RadioShack, Toys R’ Us, and Aerosoles. Meanwhile other retailers like Macy’s and Sears announced they would shut down hundreds of stores across the country.
While most traditional retailers have yet to develop an AI strategy, some stores and e-commerce players have started using AI and robotics to transform the retail space. With recent advances like computer vision-based cashier less stores, an increasing number of retailers may be forced to improve their AI game in the coming years.
Using CB Insights data, we dug into the changing retail landscape. Below, we analyze how AI, machine learning, and computer vision-based technologies — including robots used for heavy lifting, navigation, and assembly tasks — are impacting all parts of the retail chain, from the manufacturing of goods all the way to their distribution.
AI attacks different parts of the retail chain
We looked at the different stages in bringing a product to market, from manufacturing to delivery, and how companies are using AI-enabled automation — including facial recognition, demand forecasting, and computer vision-based robots — to enhance each of these stages.
Using artificial intelligence, OSA Hybrid Platform gives retailers the tools to neutralize understocking and overstocking at their stores. In addition, its business planning and enterprise solutions will allow manufacturers to work more closely with retailers to minimize supply chain disruptions, cut back on waste, and better understand purchasing trends.
Manufacturing: bringing a product to market
Meeting ever-shifting consumer demands requires reducing manufacturing lead times. To do so, some retailers are turning to robots using computer vision for assembling products like apparel and footwear.
OSA Hybrid Platform keeps its finger on the pulse of the entire supply chain ecosystem. It’s an all-in-one product tracker, shelf monitor, and data aggregator solution, one that will give retailers the necessary tools to better serve consumer needs.
The platform’s artificial intelligence will provide retailers and manufacturers with the data they need to mitigate product waste. OSA Hybrid Platform pools data from stores and warehouses to let retailers know what products they should stock-up on and which products they have in excess. Using sensors for shelf monitoring, the AI may also keep track of in-store product movements in real-time, giving employees the ability to act on stock outs the moment they occur.
Warehouse automation: sorting, storing, & managing inventory
The road to automation passes through warehouses and factories where robots collaborate with humans. As more people shop for products online, there is greater pressure on order fulfillment centers to ship items on time.
Robots are still less-than-perfect at gripping, picking, and handling items in unstructured environments. But startups are beginning to address some of the challenges in robotic gripping and handling of delicate goods.
RightHand Robotics, for example, raised an $8M Series A in Q1’17 to develop piece-picking robots. Rethink Robotics, which focuses on the manufacturing sector, is also developing robots for logistics and material handling. It is backed by investors like Goldman Sachs, CRV, Draper Fisher Jurvetson, Bezos Expeditions, and GE Ventures, and has raised nearly $150M in total disclosed funding.
Supply chain & logistics: delivering orders to consumers
Shipping companies are using AI and IoT to better track global shipments.
The global retail supply chain is getting increasingly complicated.
Sellers and consumers alike want to know where their products are, what condition their shipments are in, and what their delivery estimates are, every step of the way.
But the sheer scale and complex networks of people involved in transporting goods — from freight forwarders and freight operators to retailers and warehouse owners — makes supply chain visibility a challenge.
Despite the rise of AI-based solutions, only a handful of traditional brands have been effectively implementing AI strategies to drive business efficiency.
But AI is reshaping the retail workforce — from manufacturing to last-mile logistics — and players across the retail ecosystem will have to adapt to stay relevant.
Retailers may increasingly compete with each other — and with tech companies working in other industries — for AI startups and talent, as artificial intelligence continues to spread across the retail ecosystem.
