AI in Warehousing Market size was USD 10.6 billion in 2024 and is estimated to reach USD 242.2 billion by the end of 2037, expanding at a CAGR of 27.2% during the forecast period, i.e., 2025-2037. In 2025, the industry size of AI in warehousing is estimated at USD 13.5 billion.
The gradual digital shift is primarily fuelling the adoption of artificial intelligence (AI) and other digital technologies such as machine learning, big data analytics, cloud computing, edge computing, and the Internet of Things in warehousing applications. Warehouse operators across the globe are widely adopting AI to streamline workflow, reduce operational costs, and increase automation. AI also reduces the need for labor as it increases the working speed level, mitigates errors, maximizes resource utilization, boosts order processing, and improves inventory management by effectively coordinating with logistics.
Recent studies by Research Nester estimate that around 37% of logistics and transportation companies are employing AI to drive more value from rules-based automation. Over 51% of warehouse robotics and 47% of warehouse drones are being actively used to increase operational efficiency. Thus, to move from process automation to smarter automation many companies are investing in AI technologies.
Growth Drivers:
Challenges:
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Base Year |
2024 |
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Forecast Year |
2025-2037 |
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CAGR |
27.2% |
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Base Year Market Size (2024) |
USD 10.6 billion |
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Forecast Year Market Size (2037) |
USD 242.2 billion |
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Regional Scope |
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Component (Hardware, Software, Services)
Hardware segment is expected to hold over 43.3% AI in warehousing market share by the end of 2037, owing to its efficiency and versatility in operational handling in warehouses. Hardware solutions such as cameras, sensors, and robots enabled with AI technology have the capabilities to significantly transform warehouse operations. Many market players are highly concentrated on introducing advanced hardware solutions and for the same, they are employing various tactics. For instance, in July 2024, Mytra came up with USD 78 million in Series B funding and other commercial investors including Albertsons Companies, Inc. for its first-of-kind three-dimensional robotics and AI for warehouses to enhance productivity.
Deployment Mode (Cloud-based, On-premise)
By 2037, cloud-based segment is projected to hold more than 65.2% AI in warehousing market share, mainly due to its flexibility and cost-effectiveness. Without investing in on-site IT infrastructure, these cloud-based platforms offer scalability to end users further helping in resource management depending on demand. In warehouses where product volume keeps fluctuating, cloud-based platforms are the most advantageous and cost-effective. The cloud-based solutions are also easier to integrate with several technologies leading to highly productive outcomes. For instance, in September 2022, Element Logic announced the launch of its cloud-based platform that enables warehouse operations based on real-time data.
Our in-depth analysis of the global AI in warehousing market includes the following segments:
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Application |
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Deployment Mode |
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Organization Size |
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End use |
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North America Market
North America in AI in warehousing market is expected to hold over 41.5% revenue share by the end of 2037. The early introduction of online shopping and e-commerce platforms substantially drives the adoption of AI technologies in warehouses. Furthermore, the digitalization trend coupled with continuous investments in innovations is leading to the development of advanced technologies for inventory management, warehouse optimization, supply chain visibility, and order picking and sorting.
In the U.S., the majority of people prefer buying goods through online platforms and the e-commerce boom in the country is fuelling high demand for AI in warehousing. According to a report, around 284.6 million online shoppers will be recorded in the U.S. in 2025.
In Canada, the rapidly expanding e-commerce platforms and high usage of advanced AI solutions in warehouses, logistics, and transportation applications. The country has some of the best minds in the field of artificial intelligence. One such is the Scale AI based in Montréal which offers excellent digital technologies for several industries including warehouses, logistics, and transportation. The National Research Council of Canada is also supporting Scale AI in developing AI-powered tools to expand the logistic sector in the country.
Asia Pacific Market Statistics
In Asia Pacific, the adoption of AI in warehousing is expected to increase at a fast pace during the forecast period. Several start-ups are entering the e-commerce sector and developing online platforms that offer multiple benefits and discounts, which leads to high online product sales. This further increases the load on warehouses fuelling the adoption of AI technologies to streamline the workflows and enhance productivity.
In India, companies are continuously developing innovative solutions to improve operational efficiency in warehouses. For instance, in June 2024, Affordable Robotic & Automation Ltd. (ARAPL) revealed that in the next 6 months, it is set to develop autonomous forklifts and Latent Lift robots to boost efficiency and safety in warehouse operations. The country also has a massive presence of online shoppers, which is contributing to the AI in warehousing market growth. According to the India Brand Equity Foundation, the country has around 936.16 million active internet users and over 350 million mature online users who continuously engage in transactions.
China with its largest e-commerce sector is significantly driving the adoption of AI in warehousing. AI is drastically helping warehouse operators to forecast demand due to their advanced algorithms. The e-commerce and logistics companies such as Alibaba and Cainiao in the country majorly employ AI technologies to enhance their supply chain operations.
The key players in the AI in warehousing market are adopting several organic and inorganic tactics to maximize their profit shares. They are collaborating with other players to develop next-gen solutions and attract a wider consumer base. Industry giants are also engaging in regional expansion strategies to grab opportunities in high-potential economies. For instance, Microsoft’s Azure and other cloud services revenue growth accounted for 35% in FY24 Q3.
Some of the key players include:
Author Credits: Abhishek Verma
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