As automation increases, retailers are rethinking the fundamentals

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Robotics will likely drive tectonic shifts in manufacturing. As low-skilled labor costs become less important, some manufacturing may shift away from low-cost countries, especially when laws favoring local manufacturing, such as the inflation, increase incentives. This could have major implications for sourcing, partnerships, design cycles and fulfillment operations, and retailers need to be prepared.

Cybersecurity is even more important. More machines mean more areas that need to be protected against malware, phishing, and other strategies devised by hackers. As the danger increases, most businesses are increasing their budgets and strengthen their counter-threat capabilities.

Despite economic uncertainty, keep an eye on long-term automation. While short-term investments may need to be reduced, any retailer that ignores the possibilities of automation will put the medium to long-term health of their business at risk. In-store automation will be an $8.4 billion business by 2030 based on a compound annual growth rate (CAGR) of 25%, according to ABI Research. The next year promises to be eventful, but automation technologies continue to improve.

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