Role of AI in Food and Beverages Supply Chain Management

The AI platform will use supply chain management professionals' feedback to create algorithms that help with procurement decisions.

FREMONT, CA: The number of food and beverage companies using Artificial Intelligence (AI) for everything from supply chain forecasting to consumer visibility is increasing, as is the scope of applications for the supply chain management. AI software is used in various sectors, including healthcare, travel, retail, financial services, and more.

It is no surprise that food and beverage companies have so many possible use cases for AI, given that food tech and logistics and transportation are two of the top industries for AI implementation. While logistics, predictive analytics, and visibility are among the most popular AI applications in supply chain management, others exist. Take a look at each of the major points below.

Supply Chain Planning and Demand Forecasting

Supply chain planning is one of the most common applications. By assisting food and beverage companies in forecasting demand against commodity supply and ingredient orders, AI strengthens supply chain planning. The AI platform will use supply chain management professionals' feedback to create algorithms that help with procurement decisions. AI allows for highly accurate forecasts on when and where resources are required, so delivery of ingredients to the necessary manufacturing facilities can also be optimized.

Automated Procurement

As the use of automation increases, procurement teams will shrink in size in the distant (or not so distant) future. Procurement teams may be more concerned with choosing the right vendors and forming vendor relationships than determining how to get what is required from short supply chains.  Robots could take over that job. Procurement bots are now able to position orders with suppliers using technical rules and automations. However, because most businesses are only trying to use AI for better demand forecasting and supply chain management, not even talking to suppliers is an AI application that has not received much traction.

Remove Language Barriers That Jeopardize Compliance and Auditing

While many seasoned professionals in the food and beverage industry might guess that AI will help with demand forecasting, few could predict the next AI application: removing language barriers. Language barriers may be a major issue when talking with suppliers about product specifications, agreements, certifications, and other nitty-gritty information. This poses a chance of auditing and compliance problems in the future. Perhaps, the supplier agreed to something they did not necessarily conform to, or maybe one misinterpreted their explanation. By reading foreign language data and converting it into data that can be understood and used, AI technology for supply chain management and procurement can reduce the risk of foreign communication.