AI Dispatch ·
AI in Distribution: 2025 Wrap
2025 tested every assumption we had about AI. The year delivered real wins, but not where most expected.
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Hi, I’m Lily. I live in the world of distribution, where 2025 tested every assumption we had about AI. The year delivered real wins, but not where most expected. Autonomous everything? Not quite. Narrow, targeted deployments that solved specific bottlenecks? That’s where the gains showed up. This week, I’m taking stock of what worked, what didn’t, and what’s coming in 2026. Let’s wrap it up.
If you only read one thing this week, it is this:
Logistics Viewpoints identifies the real 2025 AI wins in logistics. Winners focused on narrow deployments: forecast refinement, routing during disruptions, document compliance, exception prioritization. Fully autonomous operations underdelivered. In 2026, AI shifts from bolt-on tools to native TMS/WMS features, making targeted integration the differentiator.
What’s Working in the Field
Agentic AI Pushes Manufacturing Beyond Fixed Automation
PYMNTS frames agentic AI as manufacturing's shift from fixed automation to adaptive, self-directed systems. Toyota's case study stands out: replacing 70+ spreadsheets with AI-driven planning improved forecast accuracy 20% and planner productivity 18%.
Industrial Equipment News reports AI vision systems now exceed 99% defect detection. The key differentiator is AI that learns and acts autonomously while keeping humans in the loop. Manufacturers still relying on calendar-driven planning cycles may find themselves outpaced.
AI in Logistics: What Worked in 2025, What Didn't
Logistics Viewpoints' year-end analysis identifies the real 2025 AI wins in logistics. Top performers: forecast refinement using external signals, AI-assisted routing during disruptions, document intelligence for compliance, and exception prioritization that cut noise while boosting actionability. Where AI fell short: fully autonomous forecasting and carrier selection. In 2026, expect AI-native TMS/WMS and Graph RAG for supplier reasoning. Operators who deployed narrow, well-integrated AI pulled ahead, while broad automation chasers risk widening the gap.
Whole Foods Deploys AI to Cut Food Waste 80%
Whole Foods will deploy Mill Commercial starting in 2027: an AI-powered system that dehydrates produce scraps on-site and converts them into chicken feed for the grocer's egg suppliers. The closed-loop model reduces waste volume by 80%, cuts hauling costs, and feeds real-time data back into inventory and ordering decisions. Mill claims it's the grocery industry's first on-site food waste conversion at commercial scale. Distributors watching margin pressure should note how waste streams are becoming operational assets.
WEF: Agentic AI Turns Supply Planners into Orchestrators
The World Economic Forum argues agentic AI will transform supply planners from firefighters into orchestrators. As volatility becomes permanent, organizations are shifting from site-centric to network-centric planning, pooling resources across plants. Current AI tools simulate disruptions; agentic systems go further, autonomously monitoring signals and proposing adjustments before planners act. Human judgment stays central, but the role changes fundamentally. Planning teams still wedded to spreadsheets risk falling behind as orchestration becomes the new baseline.
What’s In My Ears
A 2025 Wrap-up with Richard Howells and Öykü Ilgar
In this year-end episode of The Future of Supply Chain, hosts Richard Howells and Öykü Ilgar recap 2025's defining supply chain themes. The conversation spans AI-enabled operations, digital twins, business network orchestration, cybersecurity risks in ERP systems, and geopolitical disruption from tariffs and trade shifts. A key thread: human-centric workforce strategies alongside automation, and how ESG regulation is reshaping sustainability efforts. The hosts point to resilience as the throughline for 2026 success. Worth a listen for operators looking to benchmark where the industry landed, and where it's headed.
Lily’s Quick Take
Looking back at 2025, the pattern is clear: AI rewarded precision over ambition. Toyota replaced 70 spreadsheets; Logistics Viewpoints found the biggest wins in forecasting, routing, and exception management. The World Economic Forum sees planners evolving from firefighters to orchestrators. And companies like Whole Foods are turning waste streams into closed-loop assets. The throughline? AI works when it’s embedded in workflows, not bolted on top of them.
As we head into 2026, the question shifts from “where can we use AI?” to “where is AI already expected?” Resilience, adaptability, and targeted integration will separate leaders from laggards.
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