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The supply chain industry trends related to artificial intelligence (AI) point to a revolutionary change in how companies handle and maximize their supply chain operations, including procurement and logistics. The increasing use of demand forecasting and predictive analytics technologies driven by AI is one such development. With the ability to evaluate past data, forecast demand trends, optimize inventory levels, and improve overall supply chain efficiency, these AI-driven technologies are transforming supply chain management. The growing use of AI-powered drones and driverless cars in logistics and transportation is another noteworthy development. AI is transforming transportation route planning, warehouse automation, and last-mile delivery, resulting in more efficiency, lower costs, and faster delivery times. The logistics scene is changing as a result of AI being integrated into drones and autonomous cars, which provide previously unheard-of levels of operational intelligence and control.
Moreover, the development of intelligent, networked supply chain systems that can independently gather, evaluate, and act upon real-time data is being influenced by the convergence of artificial intelligence (AI) and the Internet of Things (IoT). Increased operational visibility and decision-making capabilities are being made possible by this trend, which is propelling the growth of AI-enabled IoT applications in supply chain monitoring, asset tracking, predictive maintenance, and inventory management. In addition, the need for ethical and sustainable sourcing methods is pushing the use of AI technology to streamline supply chains, cut down on waste, and limit carbon emissions. The increasing focus on sustainability and ethical sourcing methods is reflected in the capacity of organizations to make ecologically responsible decisions in their supply chain operations thanks to AI-powered optimization algorithms.
An further noteworthy trend is the democratization of AI, which emphasizes the need to make AI easier to use and more approachable for supply chain experts. Supply chain professionals can now leverage AI capabilities without requiring extensive technical expertise thanks to the development of user-friendly AI platforms, AI-as-a-service offerings, and industry-specific AI applications. This trend is expected to drive broader adoption and empower users to make data-informed decisions. Concerns about algorithmic bias, data privacy, and ethical use of AI technology are driving a trend in supply chain operations toward more regulatory oversight and control. Governments and regulatory bodies are focusing on establishing guidelines and standards for responsible AI deployment in the supply chain, aiming to ensure fairness, transparency, and accountability in AI systems.
Artificial Intelligence in Supply Chain Market Highlights:
AI in Supply Chain Market Overview
The AI in Supply Chain Market size is projected to grow from USD 51.35 billion in 2024 to USD 85.3 billion by 2032, exhibiting a compound annual growth rate (CAGR) of 7.80% during the forecast period (2024 - 2032). Additionally, the market size for AI in Supply Chain was valued at USD 47.8 billion in 2023.
Improving overall supply chain performance and rising economic digitization, particularly in emerging economies, are the key market drivers enhancing market growth.
Figure1: AI in Supply Chain Market, 2018 - 2032 (USD Billion)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
AI in Supply Chain Market Trends
Rising economic digitization in emerging economies is driving the market growth
By using cognitive predictions and recommendations on optimal actions, artificial intelligence in the supply chain helps to improve overall supply chain performance. Artificial intelligence is used in supply chain applications to automate resource allocation, task assignment, etc.
Rising economic digitization, particularly in emerging economies, will be a major market growth driving factor. Surging demand for greater visibility and transparency in supply chain and logistics data, increasing generation of large amounts of data and information, increasing adoption by small and medium-sized businesses, and strengthening IT industries in developing economies such as India and China will all exacerbate market growth. The proliferation of cloud-based services and an ever-expanding set of benefits. Artificial intelligence (AI) is a technology that enables machines, software, and systems to compete in some areas with human intelligence and behavior. A system controls the AI, which interprets data and performs various tasks using complex algorithms. Artificial intelligence can be used throughout the supply chain, including data extraction, data analysis, supply and demand planning, and autonomous vehicle management. It can also gain access to warehouse procedures to improve product shipping, receiving, storing, picking, and management. Improving logistics can be accomplished by optimizing warehouse operations and distribution. AI-based solutions can help businesses improve supply-chain management performance and quality. Some examples include end-to-end visibility, demand forecasting methods, dynamic planning optimization, integrated business planning, and dimensional flow automation. However, a lack of technological expertise in underdeveloped and developing economies will hamper the market's growth. In addition, a lack of labor and rising labor costs will slow the market's growth rate. The lack of strong infrastructure facilities in developing economies and the complexities associated with artificial intelligence coding will also challenge market growth rates.
Artificial intelligence has emerged as one of the most effective technologies in recent years, transforming the landscape of nearly every industrial vertical. Although AI and machine learning (ML)-based enterprise applications are still in their infancy, they are increasingly driving business innovation initiatives. The Artificial Intelligence In Supply Chain Market report offers a comprehensive market analysis. The report thoroughly examines key segments, trends, drivers, restraints, the competitive landscape, and factors that are significant in the market. Thus, driving AI in Supply Chain market revenue. The field of supply chain management is being quickly transformed by artificial intelligence (AI). Businesses may increase productivity, cut expenses, and make better decisions with the aid of AI-powered technologies.
AI in Supply Chain Market Segment Insights
AI in Supply Chain Component Insights
Based on components, the AI in supply chain market segmentation includes software, network, hardware, FPGA, GPU, and ASIC. The software segment dominated the market, and Al is increasingly used in various applications. Al and related software development kits have seen continuous advancements. Furthermore, Al software is capable of intelligent behavior. Intelligent software is created by simulating a variety of capabilities, such as reasoning, learning, problem-solving, perception, and knowledge representation has enhanced the AI in Supply Chain market CAGR across the globe in recent years.
Figure 2: AI in Supply Chain Market by Components, 2022 & 2032 (USD billion)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
AI in Supply Chain End-users Insights
Based on end-users, the AI in supply chain market segmentation includes automotive, retail, and manufacturing. The retail segment held the majority share in 2022 concerning the AI in Supply Chain market revenue. Machine learning algorithms and constraint-based modeling, a mathematical approach in which the outcome of each decision is constrained by a minimum and maximum range of limits, are being used to identify patterns and influential factors in supply chain data. This data-rich modeling enables warehouse managers to make more informed inventory stocking decisions.
AI in Supply Chain Technology Insights
Based on the technology, the AI in supply chain market data includes machine learning and natural language processing. Machine learning generated the most income. This expansion could be attributed to rising demand for AI-based intelligent solutions, increased government activities, and AI solutions' ability to handle and analyze large amounts of data efficiently and scan, process, and respond to anomalies quickly. In 2022, Computer Vision had the second-largest market share. The use of computer vision technologies in supply chain activities is rapidly expanding across various industrial verticals. The segment's growth is fueled by increased awareness of the benefits of AI and the availability of automation implants for AI in Supply Chains, positively impacting the market growth.
AI in Supply Chain Regional Insights
By Region, the study provides market insights into North America, Europe, Asia-Pacific and the Rest of the World. The North America AI in Supply Chain market will dominate due to the presence of developed economies focusing on improving existing supply chain solutions, important participants in this industry, and a strong propensity to adopt sophisticated technology.
Further, the major countries studied in the market report are The U.S., Canada, German, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.
Figure 3: AI IN SUPPLY CHAIN SHARE BY REGION 2022 (%)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
Europe’s AI in Supply Chain market accounts for the second-largest market share. This is due to the presence of a young and tech-savvy population in this region and the growing proliferation of the internet of things (IoT). Further, the German AI in Supply Chain market held the largest market share, and the UK AI in Supply Chain market was the fastest-growing market in the European region.
The Asia Pacific AI in Supply Chain Market is expected to grow at the fastest CAGR from 2023 to 2030. The rapid development of the region's economy, the presence of a young and tech-savvy population in the region; the increasing popularity of the Internet of Things (IoT); the increase in disposable income; computer vision acceptance continues to grow; and the application of computer vision technology in many applications has grown. Furthermore, artificial intelligence-based solutions and services are becoming more prevalent in supply chain operations. The region's increased digitalization and improved connectivity infrastructure are also important factors. Moreover, India AI in Supply Chain market held the largest market share, and China AI in Supply Chain market was the fastest-growing market in the Asia Pacific region.
AI in Supply Chain Key Market Players & Competitive Insights
Leading market players are investing heavily in research and development to expand their product lines, which will help the AI in Supply Chain market grow even more. Market participants are also undertaking various strategic activities to expand their footprint, with important market developments including new product launches, contractual agreements, mergers and acquisitions, higher investments, and collaboration with other organizations. To expand and survive in a more competitive and rising market climate, the AI in Supply Chain industry must offer cost-effective items.
Manufacturing locally to minimize operational costs is one of the key business tactics manufacturers use in the AI in Supply Chain industry to benefit clients and increase the market sector. The AI in Supply Chain industry has recently offered some of the most significant medical advantages. Major players in the AI in Supply Chain market, including Nvidia Corporation, IBM Corporation, Intel Corporation, Xilinx Inc., Samsung Electronics, Microsoft Corporation, Micron Technology, SAP SE, Oracle Corporation, Logility Inc., Amazon, LLamasoft and others are attempting to increase market demand by investing in research and development operations.
Nvidia Corporation NVIDIA pioneered accelerated computing to solve problems no one else could. Our work in artificial intelligence and the metaverse transforms the world's largest industries and profoundly impacts society. The metaverse, or 3D internet, promises a world where virtual collaboration is simple and industrial behemoths can reap the benefits of digital twins. NVIDIA OmniverseTM is a tool for creating and managing metaverse applications.
IBM Corporation, bring together all of the necessary technology and services, regardless of source, to assist clients in solving the most pressing business problems. Transformation is evolving from one-time project to an urgent, purpose-driven imperative. Modern businesses must move faster while also exhibiting greater empathy and openness. IBM Consulting is a new partner for modern business's new rules. We embrace an open way of working by bringing together a diverse set of voices and technologies. We work closely together, freely ideate, and quickly apply breakthrough innovations that exponentially impact how business is done. We believe that open ecosystems, technologies, innovation, and cultures are critical to creating opportunities and charting the course for modern business and society.
Key Companies in the AI in Supply Chain market include
- Nvidia Corporation
- Intel Corporation
- IBM corporation
- Xilinx Inc.
- Samsung Electronics
- Microsoft Corporation
- Micron Technology
- SAP SE
- Oracle Corporation
- Logility Inc.
- Amazon
- LLamasoft.
AI in Supply Chain Industry Developments
The recent rise of artificial intelligence (AI) has given the sector fresh optimism, and one particular technology, ChatGPT, is showing a lot of potential. The ChatGPT language model was developed by OpenAI to generate human-like responses to questions posed in natural language. It has been trained on a large amount of data, identifying patterns and producing solutions that are extremely accurate and pertinent to the situation. Just a few months after going live, the site had more than 100 million signups. ChatGPT has already shown enormous promise in the fields of healthcare and finance, and it is ready to change supply chain management for startups.
Actyv.ai, a category pioneer in the enterprise SaaS with embedded B2B BNPL and insurance arena with headquarters in Singapore, announced a strategic agreement with PwC India in March 2023 to promote embedded finance adoption in supply chain ecosystems for their clients. In addition to facilitating access to pertinent embedded financial and insurance products, the partnership seeks to concentrate on using the potential of artificial intelligence to spur growth prospects in the global supply chain ecosystem.
AI in Supply Chain Market Segmentation
AI in Supply Chain Component Outlook
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Software
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Network
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Hardware
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FPGA
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GPU
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ASIC
AI in Supply Chain End-users Outlook
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Automotive
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Retail
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Manufacturing
AI in Supply Chain Technology Outlook
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Machine Learning
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Natural Language Processing
AI in Supply Chain Regional Outlook
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North America
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US
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Canada
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Europe
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Germany
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France
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UK
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Italy
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Spain
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Rest of Europe
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Asia-Pacific
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China
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Japan
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India
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Australia
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South Korea
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Australia
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Rest of Asia-Pacific
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Rest of the World
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Middle East
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Africa
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Latin America
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