Ensuring the Price is Right
When foodservice distributors were recently asked about their wish lists for AI use cases, pricing strategies rose to the top, cited by just over half of respondents. That percentage was well ahead of other top use cases, including marketing/creative, product data management, and sales forecasting. The results were outlined in the IFDA report called “Delivering Efficiency: A Realistic Guide to Artificial Intelligence Use in Foodservice Distribution.”
The feedback helps explain the interest in innovative price optimization solutions that enable distributors to deal with market fluctuations and identify revenue and margin opportunities. This topic will be spotlighted at the IFDA Solutions Conference in a session called “Data-Driven Pricing: Your Key to Unlocking Hidden Profits.”
Session speaker Dallas Crawford is co-founder of technology provider SKYSHEEP, whose pricing platform uses AI and advanced data science to deliver precise data-driven price recommendations. Crawford explained to us why data-driven solutions are important for this use case.
“Foodservice distributors have five to ten thousand active SKUs that have to be priced,” he said. “They have thousands of customers. It’s important to have a data-driven way to make tens of millions of pricing decisions.”
SKYSHEEP analyzes millions of combinations of items and customers weekly, factoring in costs and other key variables. In addition to helping support margins, the approach enhances the roles of sales teams and helps improve customer retention through fair, consistent and on-target pricing, he said.
Distributors who use the tool need to provide historical sales data to help drive the analysis.
“We tell distributors that you have a ton of market insights buried in your existing transactional history,” he said. “Distributors are often shocked by how much insight exists in their own walls without having to get data from external sources.”
SKYSHEEP was one of the AI solution providers profiled in the IFDA AI report cited earlier. The company will be an exhibitor at the Solutions Conference Expo, booth #213.
Article authored by freelance writer David Orgel.
