In this episode of Thought starters, Nicole Büttner, AI entrepreneur, CEO and Founder of Merantix Momentum; Matthias Winkenbach, Principal Research Scientist at the MIT Centre for Transportation and Logistics; and Miya Knights, Retail Technology Magazine publisher, author and retail expert, discuss how AI can make supply chains more sustainable.

Miya Knights shared: “I think AI has the possibility of having an amazing impact from a sustainability standpoint in the supply chain.”

Matthias Winkenbach added: “Right now, there's a lot of waste and a lot of unnecessary emissions, unnecessary costs, created in the logistics industry.”

Nicole Buttner also said: “So when we're thinking about sustainability in the supply chain,
AI has some really exciting opportunities. From designing more sustainable materials that might be used in the supply chain, so biofuels and other more sustainable packaging, for example. And then we are also seeing AI being used to reduce redundancies, so things are being shipped to the wrong place or being returned. And just understanding better if this
item or this product will really stay in this location where it's really needed.”

Matthias Winkenbach: “Probably the biggest lever for advanced analytics, AI, to improve the sustainability of the logistics industry, is by making that industry more equipped to really anticipate what kind of demand is going to emerge when, where and how.

While the logistics industry is under pressure to move things more quickly, more flexibly and to cater to more and more individualised requests, it is also under pressure to become increasingly sustainable, to reduce its carbon footprint. And that's where advanced machine learning methods and AI really come in handy because it helps us to anticipate
what's going to happen better.

If we are able to anticipate customer orders better, we can pre-position inventory closer to the consumer.

So that when the order actually hits, the right thing is already close enough to the customers that we can fulfil that order at a very high speed without having to touch it too many times and without having to travel too many unnecessary miles.”

Nicole Buttner also adds: “The more efficient and effective use of all the resources you're using, including energy and optimising your energy demand and usage.

To be able to understand the emissions, with shipping a particular product to stores and to warehouses and then onward, fulfilment to customers.

A great area is really about reducing waste materials, so making sure that we're only producing the things we need, and not, for example, if you're thinking about fresh goods or things, not making them go bad during the supply chain process, but also making sure we're only shipping and moving the items we actually really need, and that really meet demand.

Another topic is around ESG compliance, so getting reporting and transparency about what you're doing. We know many firms struggle to have the right professionals on board,
and AI can automate a lot of this to make an auditable trail of your ESG compliance.

Miya Knights concluded: “AI is going to be absolutely vital for driving sustainability through supply chains.

Sustainability right now is very much associated with the impact that retailers and their manufacturing and sales processes have on our climate.

But I really think retailers should think about sustainability in terms of doing more with less.

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