How Integrated Technology Is Reshaping Retail Operations

The technology underpinning retail operations is under scrutiny in 2026 as fashion executives look to streamline systems with the aim to unlock efficiency, cut costs and meet consumer expectations for speed and personalisation in the shopping journey.

At the retail event Lightspeed Edge on 12 January, Lightspeed — the unified point-of-sale (POS) and payments platform for SMEs such as Apricot Lane Boutique and Neal’s Yard Remedies — convened industry leaders to explore the strategic imperative for integrated technology ecosystems over siloed systems.

For fashion retailers, this shift feels especially urgent. Seasonal buying cycles, tariff uncertainty and margin pressure are placing challenging demands on operational infrastructure. According to BoF & McKinsey & Co.’s The State of Fashion 2026 report, 45 percent of executives report sourcing costs are under strain, with changing margin, cost and cash strategies emerging as the second most significant theme this year.

To address these challenges, retailers are leveraging integrated technology to reshape their economic models, automating cost-intensive processes to free up resources for customer-facing differentiators like personalisation and enhanced store experiences.

Beyond internal operations, the friction between brands and retailers represents another layer of inefficiency that technology aims to resolve.

Lightspeed Wholesale, Lightspeed’s B2B commerce platform, seeks to streamline wholesale ordering by connecting brands directly to retail POS systems. The goal is to create supply chain transparency, connecting brand inventory with retailer demand signals and eliminating the traditional guesswork in wholesale partnerships.

“There was a time when a good location and a smile were enough. That time is gone,” said Dax Dasilva, Lightspeed’s founder and chief executive. “Today, you are a merchandiser, a marketer, a data analyst and the decision maker. The admin, the spreadsheets, the disconnected systems — they can drown out the one thing that actually matters: the customer.”

Consumer research presented at the event from the company’s “Inside the Minds of Customers” survey of nearly 400 US consumers revealed a striking contradiction: despite e-commerce convenience, 76 percent of shoppers still want to see and touch products in person. Yet the bar for in-store experiences has risen considerably, with 38 percent of US consumers wanting inventory visibility before they visit a store.

As digital fatigue sets in and a return to offline social connection grows, leading retailers are repositioning stores as experiential destinations and community hubs, banking on physical retail to boost brand loyalty and sentiment. Customer retention rates hinge on nailing customer expectations, including queue management, staff training and seamless checkout.

For this reason, retailers need systems that track the full customer journey — such as connecting social media advertising spend to in-store sales and feeding in-store behaviour back into digital marketing campaigns. To address these painpoints, Lightspeed supports integrations with third-party platforms such as Klaviyo, a CRM built for consumer brands, and Meta.

The Klaviyo integration triggers targeted email and SMS campaigns based on in-store purchases to create a closed loop between physical and digital touchpoints. The integration also synchronises sales and customer data — what was bought, categories, discounts, location — from the POS into Klaviyo, creating a unified view of online and offline behaviour.

The Meta integration tackles a longstanding blind spot in retail attribution by tracking offline conversions, allowing retailers to connect social advertising directly to in-store sales. To do so, Lightspeed’s suite of services uploads in‑store purchase data so Meta can attribute such events to ad-exposure.

With greater visibility into the full impact of their social commerce investments, retailers can allocate spend more effectively and double down on channels that drive offline sales. This reflects the reality that today’s shoppers move fluidly across channels.

Artificial intelligence (AI) can play a crucial role in making this experience seamless. Some of the most successful implementations of AI focus on augmentation rather than substitution, with Lightspeed using AI to automate back-office tasks and surface business insights, allowing staff to focus on customer engagement rather than administrative work.

The challenge is execution, with replacing entrenched systems sometimes requiring significant capital investment and organisational change-management.

But for many retailers, the cost of inaction is proving higher: according to The State of Fashion 2026, companies that use tools such as AI agents, can link systems like product lifecycle management (PLM) and enterprise resource planning (ERP) to create a unified view of sourcing, which enables real-time analytics and could unlock double-digit cost savings.

Dasilva argued that the shift is ultimately about enabling physical retail to leverage its competitive advantages. “The market is telling us: in a world of algorithms, the physical store can be a place not only for commerce, but also connection,” he said. “You can better capitalise on that if you have the right tools to clear the path.”

Want to dive deeper into an insight from this article? Check out The Brain of Fashion, BoF’s new generative AI tool where you can unlock BoF’s technology archive with a single question.

This is a sponsored feature paid for by Lightspeed as part of a BoF partnership.