The top retail/CPG planned technology spending area is…

A new survey reveals that the number one technology retailers and CPG companies will dedicate funding to may not be dominating the news.

According to a new global study of retailers and CPG companies from unified supply chain/retail planning technology provider Relex Solutions, while 57% of retailers and CPG companies plan to invest in predictive and generative AI in the next three to five years, AI and machine learning (ML) ranked fifth in importance for overall technology spend.

Enhancing e-commerce capabilities led all technology spending priorities, followed by improving inventory management, demand forecasting, and leveraging data analytics.

Overall, respondents rated rapidly shifting consumer demand volatility (55%), global events and disruptions (50%), and inaccurate sense of customer-specific demand (43%) as the biggest threats to improving supply chain efficiency and accuracy over the next three years.

In addition, almost all (94%) respondents also said they have been impacted by social media influencing or "de-influencing" over the last 12-24 months.

Retailer findings

Other key data points specific to retail respondents include:

• The top-three most essential capabilities for retailers to manage consumer demand and inventory levels are real-time inventory visibility (45%), customer demand sensing (45%), and inventory optimization tools (43%)
• Six-in-10 (59%) retail respondents are expanding omnichannel options from some locations to accommodate shifting consumer delivery preferences.
• More than half (53%) of retail respondents are expanding supplier base / sourcing options to add sourcing redundancy to diversify and mitigate risks associated with disruptions.

"The retail and CPG industries continue to face complex, global challenges that require actionable insights to accurately predict, anticipate, and manage consumer demand," said Laurence Brenig-Jones, VP of strategy & marketing, Relex Solutions. "To thrive in this new reality, companies must fundamentally transform their approach to supply chain management by breaking down silos, embracing new technologies like AI and ML, and fostering a culture of collaboration and agility. The winners will be those that can achieve resilience and flexibility, to sense and respond to disruptions and opportunities in real-time, and continuously adapt their strategies in the face of change. With the right mindset, tools, and partners, retailers and CPGs can build the supply chains of the future and unlock new levels of growth and profitability."

[Read more: Survey: Supply chain leaders continue improvements]

The Relex State of Supply Chain 2024: Retail and CPG Dynamics report was conducted by Researchscape and surveyed 285 retail, CPG, and wholesale executives globally in February 2024.