The ScaleFactor State of SMB Finance reported that only 10% of retailers have actually unlocked the benefits of using Artificial Intelligence (AI). Most small or medium-sized firms are still reluctant to implement AI or Machine Learning (ML) in their existing workflows.
The report further states that 40% of the retailers are not interested or aware enough about Artificial Intelligence as a technology. Despite the disinterest, 44% of retail businesses confirm that they do not find the process of implementing AI or ML challenging or complicated. These numbers are the highest across all other industries. Over a third, i.e., 39% of the retailers admit to ignorance of how AI/machine learning could actually be adopted in their systems to simplify operations. So, the data seems conflicting during this early stage of AI and ML technology adoption, especially for small businesses with limited funds.
While most of the medium-sized businesses (72%) use ML and AI, very small businesses (13%) are lagging far behind across all sectors. Those leveraging AI often are limited to bookkeeping (76%), invoicing (61%), payroll processing at 60%, and bill paying at 55%. Small businesses are finding value addition in adopting technology solutions like AI and ML to assist in the back office to match the speed at which the e-commerce industry is evolving. Retailers are now experiencing a new phase that focuses on harnessing the efficiencies of an intelligent workforce through the use of prescriptive and insightful technologies. Even if the rate of adoption is slow, the change needs to come in as retailers rely on advanced AI technologies.
A majority of SMBs are adopting technology-based accounting or back-office solutions – ditching the Chief Financial Officers (CFOs). 58% of SMBs use back-office accounting tech solutions while a whopping 76% do not even employ a full time or fractional CFO, with no plans to hire one in the future. Just about 23% of retail firms have a full time dedicated CFO. Such significant changes are being driven by technology such as ML and AI. When it comes to hiring, the retail industry has the highest rate of new hires as compared to the other vertical surveyed sectors. This clearly indicates the retail industry’s reliance on the human workforce versus the AI technologies saving labor expenditure.
It’s the right time for retailers to adopt AI for automation, natural language processing, and data analytics. Retailers need to understand that AI will help them to increase sales, improve customer experience, automate work processes, detect fraud, and provide predictive analysis. AI is particularly helpful for retailers to map consumer behavior and improve customer experiences. With AI, retailers can better collect and organize massive customer data, providing a more personalized shopping experience for customers. AI hugely helps customers find the items through visual search through chatbots. AI/ML tools are revolutionizing the retail industry in multiple ways. Whether retailers are looking to address marketing, customer service, or sales, AI provides a customized solution as per their needs.