Study: Many retailers don’t see AI as crucial to logistics success

A new study from JDA indicates that retailer investments in leading-edge logistics technology are not universal.

According to the 2019 Global Logistics report from enterprise software provider JDA and supply chain intelligence platform EFT, only 25% of retailer/manufacturer/distributor respondents plan on investing in warehouse execution or control systems in the near term to enable higher efficiency in their operations.

When asked to identify the biggest challenge in speed to the adoption of new logistics technology, 32% of these respondents cited a lack of resources to drive adoption. Other leading responses included resistance to change (28%), and lack of perceived ROI (22%).

Roughly four in 10 retailer/manufacturer/distributor respondents also demonstrated resistance to implementing leading-edge technologies, including artificial intelligence (AI), in their logistics enterprise. Only 60% say AI or Internet of Things (IoT) technology is important to staying relevant. 

However, many of these respondents do see benefits to AI and machine learning in their logistics operations. Leading areas include transportation management (62%), supply chain control tower & orchestration (58%), warehouse management (41%), and pricing (31%).

In another sign many retailers, manufacturers and distributors are not using leading-edge technology in their logistics operations, 66% of these respondents said labor availability has affected their logistics operations in the past 24 months. Yet only 31% are using automation to help solve labor shortage issues.

When asked to cite benefits of collaboration among supply chain partners, about nine in 10 (88%) retailer, manufacturer and distributor respondents mentioned improved visibility/planning. Other popular responses included increased customer satisfaction (60%), improved pickup/dock scheduling (48%), and more access to capacity (30%).

EFT surveyed 533 supply chain executives from logistics providers, manufacturers, retailers and technology solution providers, primarily in North America and Europe.