Merchandising has traditionally relied on experience and intuition. But as the retail landscape evolves, gut feel isn’t enough anymore. AI is turning merchandising into a science, enabling retailers to make smarter, faster decisions based on real-time data.
Take assortment planning for example. AI-powered tools can analyse customer behaviour, business rules, and predictive analytics to recommend optimal product mixes across thousands of locations and channels. This means retailers can tailor assortments to local preferences without increasing labour costs, driving relevance, satisfaction, and sales.
Dynamic pricing is another game-changer with AI algorithms monitoring competitor pricing, market conditions, and customer behaviour to adjust prices and promotions in real time. This ensures products are priced to maximise revenue while still delivering value to customers.
And then there’s personalisation. AI enables retailers to move beyond broad segments to a “segment of one” approach. By analysing purchase history and preferences, retailers can deliver targeted promotions and optimise product placement both online and in-store. The result? A more engaging, relevant experience that keeps customers coming back.
For more on how AI is transforming customer experience, read our blog: AI in ANZ.
Explore SAP SuccessFactors to align customer-facing workforce strategies with merchandising goals.
Retailers are facing never before seen supply chain challenges, from geopolitical instability to climate change. The result? Traditional planning methods that simply can’t keep up.
AI offers a way forward, helping retailers build supply chains that are resilient, responsive, and responsible.
Demand forecasting is a prime example. AI models can analyse vast datasets, including seasonality, market trends, and external factors, to generate accurate forecasts. This helps retailers minimise overproduction and waste, a key goal for 90% of grocery retailers, while also reducing the $818 billion lost annually to inventory distortion.
Inventory management is also evolving. AI-powered systems can optimise stock levels to prevent out-of-stocks and overstocks. Intelligent agents, like SAP’s Joule copilot for supply chain, create a self-sustaining ecosystem that automates restocking and adjusts inventory in real time.
Even logistics is getting smarter. AI-driven route planning uses live data to streamline transportation, reduce costs, and ensure timely deliveries. This shift from reactive to predictive supply chain management is helping retailers stay agile in an increasingly volatile world.
Case in point:
For broader industry insights, see our blog: Industry-specific solutions.
Discover how SAP Business Technology Platform supports intelligent supply chain automation.
Modern consumers care about more than just price and convenience. They want to know where products come from, how they’re made, and whether they align with their values. Sustainability and ethical sourcing are now core business requirements.
Retailers are responding by investing in technologies like SAP Business Data Cloud, which creates a single, trusted data foundation for end-to-end transparency. This unified platform supports ESG reporting, ensures data integrity, and helps retailers meet growing regulatory demands.
Returns are another area ripe for transformation. A logistical headache in the past, returns are now being reimagined as a strategic opportunity. AI-led analytics and omnichannel integration are helping retailers streamline the process, reduce costs, and enhance customer loyalty. Incentives like in-store return bonuses or green returns initiatives can turn a costly process into a competitive advantage.
Learn how professional services firms are navigating ESG and compliance in our blog: Agile and intelligent professional services.
Explore business process optimisation services to improve returns and sustainability workflows.
AI adoption in retail is certainly not a one-size-fits-all journey. It unfolds in three distinct stages:
Retailers must first build a strong foundation in predictive capabilities before moving to optimisation and, eventually, autonomous operations, with each stage delivering measurable benefits and setting the stage for the next.
Retailers who embrace AI today are positioning themselves for long-term success by transforming the customer experience, building trust, and driving sustainable growth.
At EPI-USE, we help retailers unlock the full potential of AI across merchandising, supply chain, and customer engagement. Our SAP-integrated solutions are designed to deliver real-time insights, automate decision-making, and support ethical data practices.
Whether you're looking to optimise your inventory, personalise your customer experience, or build a more resilient supply chain, we can help you get there faster.
Ready to lead the retail revolution? Explore how EPI-USE can help you build an AI-powered retail strategy that delivers results.