Harnessing Tech: Square Explores Economic and AI Trends
As we navigate economic disruptions from inflation and the increasing influence of AI, industry leaders across various sectors find themselves in a pivotal position. Adjusting strategies to maintain a competitive edge has never been more crucial.
Square’s 'Future of Commerce' report for 2025 sheds light on how businesses in retail, restaurants and beauty sectors are adapting to these challenges.
It surveyed thousands of UK business owners and consumers and retrieved insights from the United States, Australia and Canada.
Many businesses were shown to be using tailored technology to tackle the difficulties of needing to raise prices, shrinking consumer wallets and sustained high inflation.
Samina Hussain-Letch, Executive Director of Square UK says: “As businesses continue to face economic pressures, we’re seeing them invest in growth and experimentation as they find new, streamlined ways to work and deliver exceptional customer service – particularly through using time-saving and experience-enhancing technology.
"At Square, we strive to be the best digital partner we can be to our portfolio of sellers, giving them the time back to focus on growth, and our ecosystem is here to support UK businesses as they innovate, adapt and expand in 2025.”
The role of AI and automation across industries
With specific examples from the restaurant industry, the report illustrates the beneficial impact of AI and automation.
Restaurants, grappling with labour shortages and escalating operational costs, are increasingly embracing automation and advanced loyalty programmes.
These initiatives help them retain customers, manage costs and boost overall efficiency.
But it's not just about automation - 85% of restaurant leaders plan to introduce various technological enhancements in their operations within the year.
- 73% of restaurant leaders are spending more time on hiring than they did a year ago
- 75% of restaurant leaders are spending more time on business operations over the past 12 months
- 63% of consumers saying they have cut spending on restaurant purchases in the past 12 months
- 71% of restaurant leaders will increase their prices over the next 12 months
In the beauty industry, 84% of UK businesses are also planning to leverage AI and automation to upgrade inventory and marketing management.
The push towards providing personalised experiences is strongly supported by technology, with the report finding over half (55%) of global consumers likely to embrace recommendations from their beauty specialists.
The retail sector follows this trend, where providing in-store experiences such as classes or demos is viewed by 78% of UK retail leaders as crucial for business growth. 33% also believe they can keep up with the competition by offering more in-store events.
Square’s findings underscore a collective readiness in these sectors to harness technology’s potential to stay competitive and keep pace with changing consumer preferences.
One of Square’s sellers - Gordon’s Wine Bar in London - utilised Square’s technology improve service and reduce expenditure.
Amanda Whiteside, Administration Manager at Gordon’s Wine Bar, explains: “Square has been an innovative product for us.
"The ability to have a system that is truly integrated – it allows us in the office to look at sales trends, it allows our people who are working on front-of-house to have the information at their fingertips literally, and to provide great customer service.”
The future of technological integration
As businesses continue to evolve, the strategic deployment of technology plays a central role in maintaining a competitive edge and meeting consumer expectations in these rapidly changing times. The journey through economic and technological landscapes calls for innovation, where technology stands as a facilitator of business growth and customer satisfaction.
Rich Bayer, UK Country Manager of Clearpay, explains: “Whether it’s an in-store or an online business, or both, consumers want a seamless journey from start to finish. A critical part of that journey is the checkout, where cart abandonment continues to be a retailer challenge.
"By offering a suite of payment options, customers can choose the payment method that best suits their needs, thus reducing the risk of them walking away without completing their purchase. With the UK BNPL market forecast to grow from £30bn (US$37bn) in 2024 to £47n (US$58bn) by 2029 retailers should be looking to maximise choice and flexibility at checkout."
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