The Rise of AI in Wholesale Distribution: Transforming Traditional Sales Strategies

4 min read - January 31, 2024


Artificial Intelligence is changing the wholesale distribution industry in many ways. In this blog post, we will discuss some of the key impacts of AI on this sector and how AI-driven tools are reshaping the way businesses approach customer engagement.

Data is key
One of the main impacts of AI on wholesale distribution is the increased need to make data available centrally to inform and tune AI models. Data is the fuel for AI; without it, AI cannot deliver its full potential. This creates challenges for companies still operating on paper or even using spreadsheets or other methods that, though digital, are siloed. Your customer information is ever-changing and their details and interactions with them must be centralized and easily accessible for AI to work its magic.

This leads us to data quality and quantity. Both are essential for AI to provide robust and reliable recommendations. Lacking both, you’ll find AI is seriously hampered in its ability to help in areas like improving sales forecasting, enabling dynamic pricing, and providing real-time insights.

Increased, personalized selling
Speaking of real-time insights, one of the areas where AI can have a significant impact on your organization is in your overall customer engagement – sales and otherwise. Admittedly, customer engagement can be challenging in the wholesale distribution industry. Factors such as large and diverse customer bases, selling and servicing complex product portfolios, customer touchpoints occurring with both sales and service teams, and varied customer needs complicate things, but that’s where centralizing your data and AI can help.

AI can help make sense of all the data points to drive more targeted sales efforts. It provides a window into customer behaviors by analyzing data from various sources and identifying patterns, trends, preferences, and needs. AI can also recommend optimal times to reach out to your customers based on factors such as no recent contact, decreased order size, irregular purchase frequency, etc. At such times, it would also recommend the next best action, such as:

– Sending an email introducing a new product

– Scheduling an account review call

– Offering a discount

These actions would also consider the customer’s status and profile similarity to other customers to increase the likelihood the customer will take the preferred next step. AI can also recommend products and services (cross-sells and up-sells) that are relevant and valuable for your customers based on their purchase history, prior conversations, and similarity to other customers.

What once would have taken your sales reps hours to accomplish is now organized and addressed behind-the-scenes. Efficiency and effectiveness increase when salespeople are guided by customer-personalized sales strategies and similar tasks are aggregated and completed (in some cases using automation). This helps uplevel your organization, allowing you to better compete in the market.

Planning and forecasting
n In addition to improving day-to-day operations, the process of connecting and making sense of scattered data points improves planning and forecasting. First, consider your sales forecast. While it can help salespeople at the individual account level move deals along, it can also look at your bigger pipeline and make recommendations to help you achieve your business goals – perhaps you need to acquire more leads, accelerate certain larger deals, or promote a new product to customers most likely to buy.

More broadly, AI can also help quickly analyze data from multiple business systems you’re using today, such as ERP systems, CRM, and e-commerce platforms. This big-picture view augmented by AI’s analysis helps wholesalers identify changes in customer segments, predict demand patterns, adjust inventory levels, and optimize pricing strategies.

Time to choose
AI is not a fad or a hype; it is a reality that is reshaping every industry, not just wholesale distribution. It is a powerful force that is changing the wholesale distribution industry for the better. Ultimately, it will impact your organization whether you choose to use it or not.

If you ignore it or resist its adoption, you risk falling behind and losing market share. By embracing it and leveraging its benefits, you can gain a competitive edge, increase your customer satisfaction and loyalty, and take your organization to the next level of performance and growth. Want to learn more?