Business & Technology
Retailers make AI top priority amid cost pressures
SOFIAH NICHOLE SALIVIO
News Editor
Research published by Fluent Commerce shows retailers are making artificial intelligence their top long-term investment priority. The survey also found that most expect business growth despite cost and supply chain pressures.
Fluent Commerce’s third annual Retail Resilience Survey found that 57% of retailers plan to make AI a key strategic priority over the next five years, ahead of all other long-term investment areas. Half of respondents said investment in new technologies more broadly is a major focus, pointing to a sector seeking greater efficiency while managing persistent operational strain.
The findings are based on a survey of 100 retail professionals. They suggest confidence has held up even as businesses face higher labour costs, disruption to product flows and pressure to keep up with new systems.
Seven in 10 retailers said they feel positive about the year ahead, while 80% expect business growth. Only 17% expect losses.
That optimism comes against a difficult cost backdrop. Increased staffing costs were named as the biggest pressure facing retailers in 2026, with 44% citing them as their top challenge following recent minimum wage increases.
Keeping up with new technologies such as AI was a close second, cited by 43% of respondents. Rising operating costs were named by 34%, while 30% pointed to ongoing supply chain issues.
For many retailers, technology is both the proposed solution and a growing source of pressure. While 57% said AI would be a key strategic priority over the next five years, 43% also said keeping pace with emerging technologies and AI is one of the biggest challenges facing their business today. A further 14% identified implementing AI specifically as their leading technology concern.
Other long-term priorities were less prominent. Expansion into new markets was cited by 29% of respondents, sustainability initiatives by 28%, and strengthening partnerships by 26%.
Supply chain strain
Supply chain disruption remains widespread across the sector. Seven in 10 retailers said they had experienced disruption over the past year, and 19% described it as severe.
The operational effects were clear in the responses. The most common consequences were higher costs linked to rerouting orders, cited by 35% of retailers, stock unavailable online for 31%, and the need to increase prices for 30%. One quarter said disruption had also contributed to customer order cancellations.
Retailers said they are trying to reduce that exposure through a range of operational measures. The most common were diversifying suppliers, improving forecasting and planning, and putting stronger risk management plans in place.
Rob Shaw, General Manager EMEA at Fluent Commerce, commented on the broader mood in the sector.
“It’s heartening to see positivity in the retail sector after a tough few years.
“While the industry continues to face significant operational and economic pressures, businesses are increasingly investing in technology and operational agility to help them navigate uncertainty and continue to grow despite outside challenges. These results suggest retailers are adapting to disruption.”
Inventory picture
The survey also pointed to progress in inventory visibility, an issue that has become more important as retailers try to balance fulfilment speed, stock accuracy and customer expectations across stores and online channels.
More than two fifths of respondents, or 41%, said they now have real-time inventory visibility across their supply chain, up from 28% in the previous year’s survey.
Even so, the data suggests the problem is far from solved. Half of respondents said poor inventory visibility still creates operational difficulties, and 14% described those difficulties as significant.
Customer experience is adding another layer of pressure. Nearly one third of retailers, or 32%, said delivering a customer experience across channels is one of the biggest challenges facing their business.
Fluent Commerce linked that challenge to the need for more accurate stock information and smoother fulfilment processes, particularly as shoppers expect faster and more predictable delivery.
Shaw said the survey shows how closely customer experience now depends on inventory data.
“Customer expectations around fulfilment speed, availability and convenience continue to rise.
“Retailers that can access accurate, real-time inventory data across their operations will be in a much stronger position to respond quickly, improve fulfilment performance and deliver more consistent customer experiences.”
Freddie Van Mierlo, who represents Henley and Thame, has urged the company to prioritise fixing leaking infrastructure, which reportedly loses 2.87 billion litres of water daily.
This comes after the Environment Agency declared the Thames Valley area in drought.
The responsibility of maintaining water resources during a drought lies with water companies.
Thames Water has already implemented a hosepipe ban in the area since July 22, 2026.
Chris Weston, speaking on the BBC’s Big Boss Interview podcast, stated that some of the firm’s targets were beyond what they could achieve.
He said: “We have to hit a certain level of leakage, but it is so far in excess of what we are capable of doing, I think anyone would be capable of doing, however much money you invested, that it is not going to be achievable.”
Thames Water, the largest water company in the UK, has been under fire recently for its handling of sewage discharges and leaks.
Last year, it was fined a record £122.7 million by regulator Ofwat, largely for breaching sewage spill rules.
However, Mr Van Mierlo argues that a network-wide hosepipe ban would save around 577 million litres a day.
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He said: “So, although measures such as hosepipe bans are required during drought, it seems fixing leaking infrastructure would be a significantly more effective use of time.
“In your most recent interview with the BBC, you commented that targets to fix leakages are ‘unrealistic’, this is incredible insensitive considering we are experiencing a 1-in-500-year drought event.
“After reviewing the company’s existing drought plans, I am further concerned that the actions outlined in the early stages of drought are limited to awareness campaigns to reduce water use and hosepipe bans.
“Nowhere, even when drought progresses to severe, is there mention of emergency repairs to leaks in the system.”
He added that constituents have been contacting him daily about leaks due to Thames Water infrastructure and the lack of action following their reports.
He said: “Not only do these leaks damage property, but now in a time of drought, Thames Water are washing away an essential resource.”
The company, serving 16 million customers in London and parts of southern England, treats 4.3 billion litres of waste daily.
Mr Weston mentioned that “99.5 per cent of the time” the waste is treated successfully, although “sometimes something goes wrong”.
He added that while the company wants to improve on pollution, the chance of getting to zero pollution was “very, very slim”.
Fraser Jones, the director of Barefoot Oxford, has made clear that all its shops are staying open and there will be no job losses, as the company ‘streamlines’.
This process has seen Barefoot Oxford Limited go into liquidation with liquidators from JT Maxwell Ltd appointed on July 29. A resolution to wind up the company was passed on the same day.
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Fraser Jones, director of Barefoot Oxford, said: “Simply a reorganisation and no changes to the business at all.
“All shops staying open and no job losses.
“We are streamlining to the one company name of Barefoot Bakery, how we are best known.”
The business has three branches across Oxford in North Parade Avenue, Walton Street and Cowley Road and one in Kidlington.
It describes itself as a “small artisan bakery”.
It added: “We started out making cakes from our kitchen at home and selling them on a market stall in Oxford.
“Since then, the business has grown from strength to strength.”
Indeed, in June this year, cast of the smash hit romantic musical Waitress visited the business’ Jericho branch to publicise their performances at the New Theatre in Oxford.
It coincided with the 12th anniversary of the shop, run by Mr Jones and wife Emily.
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Barefoot Oxford – the company going under which Mr Jones is director of – reported creditors falling within a year of £375,000 in its latest accounts to March 31, 2025.
Its average number of employees was 33.
Meanwhile Barefoot Bakery Ltd – which Mr Jones is also a director of – reported creditors of £79,000 falling within a year and five employees.
The Office for Product Safety and Standards (OPSS) is also telling Home Bargains customers to keep the recalled product “out of reach of young children”.
The Toy Story themed water bottle, sold at Home Bargains stores in the UK, is being recalled because of a potential choking risk.
The TJ Morris Toy Story Water Bottle has been sold by Home Bargains since May 2026.
The OPSS warns: “The product presents a choking hazard because the spout can detach from the lid, creating a small part.
“If this occurs during use, the spout may block a child’s airway and cause them to choke.
“The product does not meet the requirements of the General Product Safety Regulations 2005.
“We recommend that you stop using the product immediately and keep it out of reach of young children. Return it to your nearest Home Bargains for a refund.”
These are the batch codes affected by the water bottle recall: 11449732, 11449736, 11449737, 11449738, 11449742, 11449743, 11449744
A Home Bargains spokesman added: “Check if you have bought the affected batch codes. Only these codes are affected. The information can be found on the swing tag on the product packaging and the care label inside the bottle.
“If you are unsure if your bottle is impacted or no longer have the packaging, return to store for a full refund.
“To obtain a full refund or if you require further information, return it to your local Home Bargains store. For more information contact support@home.bargains.
“We apologise for any inconvenience caused.”
Home Bargains Crisp recall
Crisps sold at Home Bargains have been recalled, with the Food Standards Agency (FSA) warning shoppers of a potential health risk.
ASR Solutions Ltd has recalled the Lays Sour Cream & Dill Crisps sold in Home Bargains stores in the UK, because of a labelling error.
The crisps contain milk and wheat (gluten) which are not mentioned on the label, meaning they are a “possible health risk” to anyone with an allergy or intolerance to the ingredients.
The affected products come in 125g packets and have best before dates up to and including October 31.
Friday 31 July 2026 – ASR Solutions Ltd recalls Lay’s Sour Cream & Dill Crisps #FoodAllergy https://t.co/sx7VuhfXwi pic.twitter.com/Su9jxthEaG
— Food Standards Agency (@foodgov) July 31, 2026
An FSA spokesman warned: “ASR Solutions Ltd is recalling the above product from customers and has been advised to contact the relevant allergy support organisations, which will tell their members about the recall.
“The company has also issued a recall notice to its customers. These notices explain to customers why the product is being recalled and tell them what to do if they have bought the product.
“If you have bought this product, do not eat it. Instead, return it to the store from which you bought the product for a full refund or contact support@home.bargains if you require further information.”
A Home Bargains statement added: “If you have bought Lays Sour Cream & Dill Crisps as detailed above and you have an allergy, intolerance or sensitivity to milk or wheat, do not consume it.
“Check if you have bought the affected best before dates. Only these codes are affected.
“Return any affected product to your local Home Bargains store for a full refund or contact support@home.bargains if you require information.
“We apologise for any inconvenience caused.”
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