Retail robots market is estimated to witness high growth, owing to increase in labor costs and operational efficiency
Retail robots market is estimated to be valued at US$ 12.82 Bn in 2024, exhibiting a CAGR of 29.8% over the forecast period 2024-2031. Retail robots help automate tasks like inventory checks, shelf stocking, package sorting and improve efficiency. Furthermore, these reduce dependence on human labor by performing repetitive and dangerous tasks that saves labor costs for retailers.
Market Dynamics:
Global retail robots market is expected to witness significant growth over the forecast period, owing to factors like rising labor costs and focus on operational efficiency. Labor costs account for a major portion of operating expenses for retailers. Retail robots help reduce this cost by automating routine tasks currently performed by human employees. These also increase productivity and minimize errors as compared to human workers. Moreover, using robots for inventory management and order fulfillment allows retailers to track stock levels in real-time and improve fill rates. This boosts supply chain efficiency and enhances the customer experience.
Market Drivers
Increasing Labor Costs Drives Retailers to Adopt Robotic Solutions
Labor costs are one of the biggest expenses for retailers. With minimum wage increasing every year, labor costs are rising significantly. Robots can perform repetitive and manual tasks more efficiently at a lower cost as compared to human employees. These do not require breaks, leave or additional benefits. This is a major incentive for retailers to invest in retail robots to optimize their costs. Robots can work 24/7 and perform tasks like stocking shelves, fulfilling online orders and assisting customers with little to no supervision. Adopting robotic solutions allows retailers to maximize productivity while minimizing labor expenses.
Robots Enhance Customer Experience Through Personalized Services
Customers nowadays expect exceptional and personalized experiences during shopping. Retail robots are being deployed to engage with customers and provide personalized assistance. Robots equipped with sensors and artificial intelligence can recognize customers, remember their preferences and shopping history. These can recommend products tailored to each customer's needs and interests. Robots greeting customers at store entrances, answering queries and guiding them to product locations enhances the shopping experience. Their consistent and polite behavior builds positive impressions among customers. This personalized customer engagement can prompt retailers to adopt service robots.
Market Restraints
High Upfront Investment Required for Robotic Implementation
Setting up a robotic retail system requires significant capital investment. Robots need to be purchased, installed, integrated with existing IT systems and trained. Maintenance and repair costs also need to be accounted. The total cost of ownership is quite high for retailers, especially small and medium businesses. High initial costs pose a major challenge for widespread adoption of retail robots. Retailers need to ensure robots deliver adequate return on investment to justify the expenditure.
Resistance from Labor Unions Due to Job Displacement Concerns
Retail unions are raising objections over deployment of robots for replacing human jobs. These argue robots will lead to large-scale job losses in the retail industry. While robots are likely to take over repetitive tasks, these may not completely replace humans. However, introducing robots will definitely reduce the number of employees needed. Unions are lobbying against robotic automation by pressing legal and political pressures. This resistance from labor can hamper the pace of adoption of retail robots.
Market Opportunities
Growing E-commerce Sector Requires Automation of Fulfillment Centers
Growing e-commerce industry has led to increase in online order volumes, especially during sales seasons and pandemics. Manual order fulfillment by employees is not scalable to cope with huge demand. Automating warehouse operations with robots improves productivity and capacity for 24/7 order processing. Robots efficiently pick, pack and sort items. Drone delivery is also being tested. This growing need for warehouse automation offers opportunity for deployment of material handling robots in full-fledged automated fulfillment centers.
Popularity of Contactless Shopping Augurs Well for Self-Checkout Robots
The COVID-19 pandemic has boosted demand for contactless shopping solutions. Self-checkout robots deployed at stores allow customers to purchase items without human interaction. Customers simply pick items, scan and pay using the robot’s touchscreen. The robot then packages the products. This preserves social distancing and hygiene. As consumers prefer minimizing contact during transactions, there is huge demand for self-checkout robots ensuring a safe shopping experience.
Link: https://www.coherentmarketinsights.com/market-insight/retail-robots-market-4535
Key Developments:
- On May 22, 2024, United Robotics Group introduced uLink service robots for retail, warehouse, and manufacturing settings, aiming to attract and retain talent. These robots are designed for collaboration with humans and feature an application programming interface (API) to facilitate communication with existing operations.
- On May 12, 2024, Canadian Tire Corporation (CTC) launched two innovative technology initiatives to streamline business processes for both the company and consumers. The new shopping assistant, CeeTee, available on the Canadian Tire app under the “Tires” category, assists customers in selecting the right tires for their vehicles. CTC partnered with Sanctuary AI to introduce General Purpose Robots that is designed to alleviate tedious tasks in retail stores and distribution centers, allowing employees to focus on more valuable work.
- On April 17, 2024, Pudu Robotics, a service robotics provider, launched BellaBot Pro, the next generation of its flagship smart service robot. Utilizing AI, BellaBot Pro delivers personalized interactions to customers during their dining and retail experience. Features include improved voice and greeting interaction, enhanced dish identification, an updated advertising screen, and enhanced safety and efficiency features.
Key Market Players:
Key companies covered as a part of this study include ABB Ltd., Addverb Technologies, Alphabet Inc., Amazon Robotics LLC., Bastian Solutions, Inc., Bossa Nova, Daifuku Co., Ltd., Dematic, DJI, Fetch Robotics, Inc., Grey Orange, KUKA AG, Locus Robotics, Onewell Intelligrated, Rethink Robotics, Robotiq Inc., Savioke, Siemens, Simbe Robotics, Soft Robotics Inc.
