Against the backdrop of rising labor costs, the UK retail sector is rapidly moving towards an era of automation. From electronic shelf labels to self-checkout machines, many new technologies are gradually changing the familiar supermarket shopping experience. With the increase in the national minimum wage and the rise in employer National Insurance contributions, retailers are ramping up their investments in automation technologies, hoping to cope with the escalating labor costs by enhancing productivity.
In recent holiday trading updates, investment in automation has become a focal point for major retailers. A survey showed that nearly one-third of retail finance executives indicated they would adopt more automation technologies, although this is not the only strategy they are considering. Additionally, raising prices, cutting headquarters positions, and reducing working hours are also among their options.
Image Source Note: Image generated by AI, licensed from Midjourney
Electronic shelf price tags are already quite common in other countries and are expected to enter the UK market by 2025. These tags allow retailers to quickly change prices at the push of a button, saving a significant amount of time compared to replacing paper tags. The electronics retailer Currys plans to introduce electronic pricing in 100 of its 300 UK stores by the end of this year, while Sainsbury’s and Co-op are also conducting trials.
The proliferation of self-checkout machines is no longer limited to supermarkets; clothing and home goods stores are also following suit. Primark currently has self-checkout in 41 of its UK stores and plans to add at least five more in the spring. Notably, brands like Uniqlo and Inditex are exploring new technologies for scan-free self-checkout, and Marks & Spencer is also trying this approach.
In terms of warehousing, retailers are also accelerating the automation process. According to data from Automate UK, sales of production line robots in food and beverage, logistics, and consumer goods companies grew by 31% in the first nine months of last year. Companies like Amazon and John Lewis have already begun using autonomous robots to move goods within warehouses.
Artificial intelligence is also playing an increasingly important role in the retail sector. Market research firm IGD points out that AI technology can monitor shelf conditions in real-time and automatically replenish stock. For example, Morrisons uses AI cameras to monitor the inventory status of shelf products. Additionally, retailers like Sainsbury’s and Waitrose are utilizing AI technology to optimize product placement and workforce scheduling.
Overall, while the widespread adoption of automation and AI technologies may replace some entry-level positions, the introduction of these technologies is expected to enhance overall efficiency, thereby providing consumers with a faster shopping experience. The future of retail will increasingly rely on a technology-driven development model.
