Western Grocer Serving the industry since 1916
The adoption of AI in grocery retail is hitting critical mass….indeed, 2026 may be the year when AI is scaled up to bring about one of the most significant transformations of the industry in years.
There is good reason why grocery retailers are embracing AI technology. At its core is the capability of computer systems or algorithms to imitate intelligent human behavior – and in some cases improve how to interpret large amounts of data to make decisions and solve problems
The pace of change in retail has never been faster, and when it comes to AI, the timeline is a lot shorter. Within a few years, most retailers are going to see their competitors adopt Al and gen Al on a large scale. Those that take bold action today will be the ones shaping the industry tomorrow
AI can transform your business from creating efficiencies at scale, reducing running costs, and streamlining processes. With generative AI and agentic AI, moreover, Al agents assist with complex, goal-oriented tasks with minimal human intervention—from optimizing back-office operations to resolving customer service queries or discrepancies in the supply chain—they can interact with websites, complete forms, gather and submit information and process payments.
The US based National Retail Federation, identified the roll-out of AI agentics as its top prediction for the sector in 2025, followed by gen AI in second, and AI’s role in integrating retailer systems, third—a clean sweep for the emerging technology.
AI has already been put to use in areas such as inventory management and optimization, which allows grocery retailers to more efficiently predict and forecast their demand and then make sure that the inventory they keep in stock is optimized to that demand.
Beyond forecasting and inventory management, we’re also seeing grocers using Al for quality control, which can scan meat and vegetable products to gauge their freshness and then trigger alerts and promotional actions to sell products that are near their expiry date.
Retailers are also pairing AI with advanced analytics to anticipate trends in close to real time, dynamically adjusting curated product assortments, layouts, and pricing that enhance local relevance and customer satisfaction.
To stay ahead of the curve, here are some recommendations to consider in the year ahead.
Start with value: Grocers need to move beyond isolated AI pilots and experiments, and instead, focus on enhancing business capabilities across the entire value chain. It means prioritizing AI investments based on business impact to ensure that initiatives drive real value. Only by taking a strategic, outcome-driven approach will grocers maximize return on investment and create lasting competitive advantages.
Build a secure and adaptable digital core: For AI to be effective, grocers need to establish a strong digital foundation and that means investing in the right infrastructure, including scalable cloud solutions, integrated data platforms and secure, AI-ready ecosystems. Without this foundation, AI initiatives may become fragmented, slow, or vulnerable to security threats. Retailers that manage their digital backbone strategically will enable AI to scale and evolve with the business.
Rethink talent and ways of working: AI is set to handle repetitive and transactional tasks, freeing people to focus their time and expertise toward strategy, creativity and decision making. It requires grocers to take proactive steps to upskill their workforce, redesign workflows and ultimately, create a culture where people and AI collaborate seamlessly to unlock entirely new levels of efficiency and innovation.
Implement responsible AI: As AI systems take on decision-making roles, retailers must ensure they are transparent, fair and accountable. This involves addressing algorithmic bias, complying with regulations, and creating explainable, ethical AI solutions. Responsible AI enhances customer trust, strengthens brand reputation, and delivers sustainable business value.
