By Sivakumar Lakshmanan, co-CEO, antuit.ai
Stakeholders across the food and beverage industry have been strained by the supply chain crisis, and this affects everything from daily operations to financial management to sales, planning, and fulfillment. With constantly changing demand, inflation, and unreliable deliveries, food and beverage companies are struggling to accurately forecast the needs of their customers and of consumers nationwide. Some retailers have even applied costly penalties for late order fulfillments. What was previously a dependable and predictable industry has become complex and unreliable due to rapidly changing supply chain issues.
Food and beverage industry leaders need a solution to the increasing complexity the field is facing. Leading retailers and suppliers are already embracing the digital transformation happening in food and beverage. PepsiCo has launched two digital hubs and Amazon has acquired Whole Foods, demonstrating the convergence of tech and food. But still, only 23% of consumer products organizations believe their supply chain is equipped to handle evolving business needs.
In order for food and beverage companies to stay competitive, they must invest in technology tools that improve everyday processes and support positive business outcomes. In short, tech investments should bring profit and productivity. Artificial intelligence technology has proven to create both of these outcomes in the food and beverage industry.
AI makes companies responsive, not reactive
The chief concern for many in the consumer products industry—specifically, food and beverage consumer products—is ensuring that customers receive the correct shipments at the right time with the exact amount of product needed to supply demand. Supply chain shortages and manic purchasing patterns (like stocking up on toilet paper at the beginning of the pandemic) made demand calculations a more complex process.
One specific manifestation of artificial intelligence can help food and beverage organizations solve the challenge of fluctuating supply and demand. Intelligent order promising (IOP), as it is called, helps companies prioritize customers, reduce penalties, anticipate market fluctuations, shortages, and surges, and create a proactive plan for dealing with disruption ahead of a crisis.
One multinational consumer goods manufacturer witnessed 10x ROI in increased profits and reduced financial penalties when intelligent order promising was applied to their fulfillment strategy. The most transformational aspect of the solution is that it significantly shortened the timeline of recalibration so that companies could adjust based on market fluctuations. Previously, traditional ERP-based order processing systems relied on three-to-four-month timelines and didn’t give organizations any room to adjust for a volatile market. Now, with intelligent order promising, this CPG company was able to respond to customers’ needs more quickly—which ultimately increased revenue, reduced financial losses, and improved their customers’ experiences.
Intelligent order promising positively impacts every aspect of business—from sales and finances to planning and fulfillment. Food and beverage companies must manage complex orders, respond to supply chain issues, and optimize business processes, so they can remain profitable and meet consumer demand. With artificial intelligence technology in hand, food and beverage companies are empowered to respond to their customers’ needs in a faster timeline. Intelligent order promising is the future of the food and beverage industry.
Sivakumar Lakshmanan is the Co-Chief Executive Officer and Head of AI Forecasting & Supply Chain product development at antuit.ai, a Zebra Technologies company. He has extensive experience in driving supply chain transformation leveraging advanced analytics, advising many Fortune 500 companies on demand forecasting, supply chain planning, network design, and inventory optimization across CPG, Retail and Manufacturing.