Barriers to AI Adoption in Retail SMEs: Technological, Organizational, and Environmental Challenges

Abstract

SMEs in retail can gain a lot from AI which boosts customer service, improves how businesses work and helps with planning and strategy. Still, retail SMEs are not using AI as much as big corporations even though the technology is more accessible. This paper studies the factors that prevent companies from adopting AI by using the TOE framework which has been extended to cover data-related problems (TOE-D). A thorough look at the literature finds that the main factors behind resisting adoption are technological (for example, missing explanation and risks in security), organizational (lack of resources and the right people), environmental (uncertainty in rules and ethics) and data-related (low-quality data and weak governance). This demonstrates that adopting AI in retail SMEs involves many factors, including things within the company and factors from outside. It wraps up by providing a summary of how adoption happens and it recommends ways for practitioners, policymakers and researchers to come up with solutions. It helps advance the discussion about digital transformation in SMEs by supplying a useful framework for future research and use of AI.