Retail Automation Market Size, Share & Industry Analysis, By Application (PoS Systems, Inventory Management, Customer Service Automation, and Analytics and Data Management), By End User (Hypermarket, Supermarket, Specialty Stores, Non-Food Retail Stores, and Others), and Regional Forecast, 2024 – 2032

The global retail automation market size was valued at USD 21.19 billion in 2023. The market is projected to grow from USD 24.36 billion in 2024 to USD 64.09 billion by 2032, exhibiting a CAGR of 12.9% during the forecast period.

Retail automation refers to the use of technology and software to automate various processes within retail operations. This can include everything from inventory management and customer service to checkout processes and marketing efforts. The goal of retail automation is to improve efficiency, reduce costs, enhance customer experience, and increase sales by leveraging advanced technologies, such as Artificial Intelligence (AI), machine learning, robotics, and the Internet of Things (IoT). The adoption of an automation system in retail allows customers to scan and pay for their items without the need for a cashier, reducing wait times and improving service efficiency. Further, mobile point-of-sale systems enable staff to complete transactions anywhere in the store, enhancing customer service and speeding up the checkout process. These factors play a vital role in driving the global retail automation market growth during the forecast period.

The COVID-19 pandemic had a significant impact on retail automation, accelerating the adoption of technology and changing the way businesses operate. To minimize physical contact, many retailers expanded self-checkout options and contactless payment systems. This reduced the need for cashiers and physical money handling, catering to customer preferences for safer shopping experiences. This trend is likely to continue as retailers look to future-proof their businesses against similar disruptions.

In the scope of work, we have included solutions offered by companies such as NCR Voyix Corporation, Honeywell International Inc., Diebold Nixdorf, Incorporated., Amazon Web Services, Inc., Datalogic S.p.A., Pricer AB, and others.

Impact of Generative AI

Growing Demand for Personalized Marketing and Customer Engagement is Expected to Boost Market Growth

Generative AI can create personalized marketing content, such as emails, advertisements, and social media posts, tailored to individual customer preferences and behaviors. This automation enhances customer engagement and drives higher conversion rates. By analyzing customer data and behaviors, generative AI can generate dynamic and personalized product recommendations. This can be applied across various channels, including e-commerce sites, mobile apps, and in-store displays, improving the shopping experience and increasing sales. For instance,

• In December 2023, According to International Data Corporation (IDC), businesses are seeing a 250% average Return On Investment (ROI) on their AI investments.

Moreover, retailers can use generative AI to create custom product designs or variations, such as clothing patterns or furniture styles, based on customer input or trends. This diversifies product offerings and caters to niche markets and individual preferences. Thus, as generative AI technology continues to evolve, its impact on retail is likely to grow, offering even more innovative solutions and opportunities.

Retail Automation Market Trends

Increasing Demand for In-Store Automation Technologies among Consumers Aids Market Growth

Technologies such as Electronic Shelf Labels (ESLs), automated shelf scanners, and robots that monitor inventory levels and product placement are becoming more common, helping retailers ensure shelves are stocked correctly and efficiently. Robots are being used for tasks such as cleaning, stocking, and customer assistance, reducing the need for human labor and enhancing operational efficiency. For instance,

• As per an industry survey, 50% of inventory and pricing checks will be handled by robots or automation by 2025.

Further, Internet of Things (IoT) devices are being used to gather real-time data on inventory levels, customer movements, and equipment performance, allowing retailers to optimize operations and improve customer experiences. Smart shelves can automatically track inventory levels and alert staff when restocking is needed. Smart carts are equipped with sensors and cameras that automatically scan items, calculate totals, and facilitate easy checkouts. These factors are expected to fuel the market growth during the forecast period.

Retail Automation Market Growth Factors

Rising Labor Costs and Labor Shortages in Retail Sector Fuels Adoption of Retail Automation Solution

Retailers are increasingly turning to automation to reduce reliance on human labor, especially in regions with high labor costs. Automation helps lower operational costs by minimizing the need for manual labor in various tasks, such as checkout, inventory management, and customer service. The ongoing labor shortages in many areas have made it difficult for retailers to find and retain staff, particularly for low-wage or repetitive roles. Automation helps address these shortages by filling gaps in the workforce. Moreover, customers today expect personalized shopping experiences. Automation technologies enable retailers to analyze customer data and behavior, tailored recommendations, personalized marketing, and customized promotions. Further, consumers are increasingly seeking quick and convenient shopping options. Automation helps reduce wait times at checkout, streamline product searches, and speed up the delivery process, enhancing overall customer satisfaction. These factors are set to bolster the retail automation market growth in the coming years. For instance,

• According to industry experts, retailers plan to automate 70% of their daily retail store tasks by 2025. Enabling automation technology in retail stores will reduce costs, enhance operational efficiency and achieve more profits.

RESTRAINING FACTORS

High Initial Costs and Technical Complexity May Hinder Market Growth

Implementing automation technologies requires significant upfront investment in hardware, software, and infrastructure. This can be a major barrier for small and medium-sized retailers, who may not have the financial resources to invest in these technologies. Integrating new automation systems can be complex and costly. Retailers may need to invest in additional infrastructure, training, and support to ensure smooth integration and operation.

Moreover, automation systems can be technically complex, requiring specialized knowledge and skills to implement and maintain. Retailers may face challenges in managing these systems effectively, especially if they lack in-house expertise. Thus, these factors are expected to hinder the market growth.

Retail Automation Market Segmentation Analysis

By Application Analysis

Growing Demand for Increased Efficiency and Streamlined Operations to Handle Transactions Efficiently Boost Demand for PoS Systems 

Based on application, the market is divided into PoS systems, inventory management, customer service automation, and analytics and data management.

PoS systems captured the maximum share of the market in 2023. Modern PoS systems are designed to handle transactions quickly and efficiently, reducing checkout times and improving the customer experience. Features such as barcode scanning, integrated payment processing, and digital receipts help streamline the checkout process. Point of Sale (PoS) systems are often integrated with inventory management software, allowing retailers to track inventory levels in real-time, automate restocking processes, and reduce the risk of stockouts and overstock situations.

Customer service automation is expected to grow at the highest CAGR in the coming years. Chatbots and virtual assistants powered by Artificial Intelligence (AI) provide round-the-clock support to customers, handling a wide range of inquiries from product information to order status. This ensures that customers receive prompt assistance, regardless of time zones or store hours. Also, automated email campaigns can be tailored to customer behavior and preferences, enabling more targeted marketing efforts and enhancing customer loyalty.

By End User Analysis

Increasing Adoption of Self-Checkout Systems in Supermarket to Enhance Customer Experience Boosts Market Growth

Based on end user, the market is classified into hypermarket, supermarket, specialty stores, non-food retail stores, and others (fuel stations, retail pharmacies, etc.).

The supermarket segment captured the highest market share in 2023, as self-checkout systems allow customers to scan and bag their items, reducing wait times and speeding up the checkout process. This is particularly beneficial during peak shopping hours, helping to minimize queues and enhance customer satisfaction. By reducing the need for cashier staff, self-checkout systems help supermarkets cut labor costs. They allow stores to reallocate employees to other customer service roles or tasks that require human intervention.

Hypermarkets are expected to grow at the highest CAGR in the coming years. Electronic shelf labels (ESLs) allow hypermarkets to update prices automatically and in real-time, based on inventory levels, demand, or promotional campaigns. This reduces the need for manual price changes and ensures pricing accuracy. Smart shelves equipped with sensors can detect when items are running low or if products are misplaced, helping staff quickly address inventory gaps and improving shelf management. These factors are anticipated to propel the market growth in the coming years.

REGIONAL INSIGHTS

By region, the market has been analyzed across five major regions, namely North America, Europe, Asia Pacific, the Middle East & Africa, and South America.

North America held the largest retail automation market share in 2023. Retailers in the region are increasingly adopting automation to offset high labor costs. Automation technologies, such as self-checkout systems, automated inventory management, and robotics, help reduce reliance on human labor, lower operational expenses, and improve efficiency. The U.S. and Canada are at the forefront of technological innovation, with strong ecosystems of technology companies, startups, and research institutions. This has fostered the development and early adoption of cutting-edge retail automation technologies, such as AI-driven analytics, IoT devices, and robotics. These factors play a vital role in fueling the market growth in the region. For instance,

• In July 2024, JRTech Solutions, a partner of Pricer company, will provide Pricer Plaza, a cloud-based platform to an unnamed North American grocery retailer. Through this contract, the company aims to enhance the operation of grocery retailers in North America.

Asia Pacific is expected to grow at the highest CAGR during the forecast period. The retail sector in the region is highly competitive, with both local and international players vying for market share. Retailers are adopting automation to enhance operational efficiency, reduce costs, and differentiate themselves by offering superior customer experiences. In countries such as Japan and South Korea, aging populations and low birth rates have led to labor shortages, making it difficult to staff retail operations adequately. Automation provides a solution by reducing reliance on human labor. Moreover, the Asia Pacific region is experiencing significant growth in e-commerce, driven by increasing internet penetration, smartphone adoption, and digital payment solutions. Retailers are adopting automation technologies to support omnichannel strategies, ensuring a seamless integration of online and offline experiences.

Europe is anticipated to grow at a prominent CAGR in the coming years. European consumers are increasingly comfortable with digital technologies and self-service options. This has driven the adoption of automation solutions, such as self-checkout, mobile payments, and digital kiosks, which cater to tech-savvy shoppers in countries such as the U.K., Germany, and France. Retailers such as Tesco, Carrefour, and Lidl have implemented these systems to improve efficiency and reduce checkout times. Further, the adoption of mobile wallets and contactless payment solutions is widespread across Europe. Retailers are integrating these technologies to faster and more secure payment options, enhancing the customer experience. Also, the market players in the region are significantly focusing on engaging in partnerships to strengthen their business in the region. For instance,

• In April 2023, Cardlink, a POS terminal network service provider, engaged in a partnership with Novidea and Transaction Systems. Through this partnership, the company developed a cashless store’s vending machines equipped with PAX Technology’s PoS terminal.

The Middle East & Africa (MEA) is expected to showcase noteworthy growth during the forecast period. The region is experiencing rapid growth in e-commerce, accelerated by increased internet penetration and smartphone usage. This growth is pushing traditional retailers to integrate online and offline channels, leveraging automation to enhance operational efficiency and customer experience.

Moreover, the retail market in South America is highly competitive, with local and international players. Retailers are turning to automation to reduce costs, improve operational efficiency, and enhance customer service to differentiate themselves. Owing to these factors, the market is expected to increase steadily in the region.

KEY INDUSTRY PLAYERS

Key Market Players Are Focusing on Partnership and Acquisition Strategies to Expand Their Analytics Services Worldwide

Key players in retail automation are focusing on expanding their geographical presence across the globe by presenting industry-specific services. Major players are focusing on mergers and acquisitions, with regional players strategically to maintain dominance across regions. Top market participants are launching new solutions to increase their consumer base. An increase in constant R&D investments for product innovations is enhancing market expansion. Hence, top companies are rapidly implementing these strategic initiatives to sustain their competitiveness in the market.

List of Top Retail Automation Companies:

• NCR Voyix Corporation (U.S.)


• Honeywell International Inc. (U.S.)


• Zebra Technologies Corporation (U.S.)


• Diebold Nixdorf, Incorporated. (U.S.)


• Amazon Web Services, Inc. (U.S.)


• Datalogic S.p.A. (Italy)


• ECR Software Corporation (U.S.)


• Toshiba Global Commerce Solutions Inc. (U.S.)


• Kuka AG (Germany)


• Pricer AB (Sweden)

KEY INDUSTRY DEVELOPMENTS:

• August 2024: Sainsbury engaged in a partnership with NCR Voyix Corporation. Through this collaboration, the company aims to upgrade its checkout technology by incorporating NCR Voyix Commerce Platform and PoS system to 22,500 checkouts across its convenience stores, supermarkets, and fuel stations.


• May 2024: Datalogic launched a novel Magellan 900i scanner. This scanner is an imaging-based entry-level handheld model that provides high performance to the user’s hand.


• October 2022:  Bumpa, a Nigeria-based startup company, raised USD 4 million in funds to improve the retail automation platform experience in the country. Through this investment, the company aims to expand its business in the African region.


• March 2022: Diebold Nixdorf launched the Vynamic Retail Platform, a cloud-based software solution to enhance the shopping experience in retail stores. This platform helps retailers to meet customers' needs.


• July 2021: Toshiba Global Commerce Solutions engaged in a partnership with Stor.ai. Through this partnership, Stor.ai aims to equip its platform with e-commerce infrastructure for grocers.

REPORT COVERAGE

The report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product/service types, and leading applications of the product. Besides, it offers insights into the market trends and highlights key industry developments. In addition to the factors above, it encompasses several factors that contributed to the growth of the market in recent years.

Report Scope & Segmentation