Global Retail Outlook 2024

Navigating challenges and embracing opportunities - Insights from retail leaders around the world

Despite economic clouds, retailers see sunshine. Technology like artificial intelligence (AI) is fueling optimism for growth in 2024, even amidst inflation, labor shortages, and global tensions.

A year of opportunity amidst challenges

While the shadow of past disruptions may linger, a surprising wave of optimism is sweeping the retail industry as we enter 2024. This sentiment, despite ongoing economic uncertainties, stems from a newfound belief in the transformative power of technology, particularly the emergence of generative AI. Retailers envision AI streamlining operations, boosting productivity, and creating more captivating customer experiences – all contributing to both financial growth and lasting success.

However, it's not all sunshine and roses. Inflation remains a pressing concern, squeezing profit margins and demanding strategic pricing adjustments. Labor shortages and supply chain disruptions continue to test adaptability, requiring innovative solutions to maintain smooth operations. These challenges are compounded by geopolitical tensions, adding further complexities to the global retail landscape.

Oleksandr Yampolskyi, Leader of Retail and Wholesale Distribution Group at Deloitte Ukraine says:

2024 will be a year of opportunity amidst challenges for the retail sector. Climate change, a shortage of workers and pressure on supply chains—these challenges will force retailers to adapt and invest in new technologies for them to remain competitive. This year, investing in innovation and adapting to new conditions are the key for retailers to survive and thrive.

Despite these hurdles, there's a sense of opportunity brewing. In our Global Retail Outlook 2024 report, we asked 200 retail leaders around the globe to provide their expectations for revenue and operating margin for the industry as a whole. In this report, we assess the overall health of the retail sector and retailers who can effectively navigate the changing market terrain are poised for significant growth.

What are the challenges and opportunities that lie ahead of the retailers?

We present a deep dive into three systemic challenges and three opportunities that will define the retail industry not only in the year ahead, but into the next decade and beyond.

Challenges:

• Climate change and the credibility of retailers’ commitment towards the green transition
• A shortage of workers
• Supply chains under pressure

Opportunities:

• Health and wellness on the rise
• Technology supports a shift from mass to micro
• Unlocking the power of Artificial Intelligence

Evan Sheehan, Retail, Wholesale & Distribution Sector Leader, Deloitte Global says:

Buoyed by opportunities founded in technology – not least the spectacular emergence of generative AI – which will reduce costs, improve productivity and enhance the customer experience, the retailers we interviewed as part of our Global Retail Outlook provided an optimistic outlook for both top and bottom line performance across the sector.