NEWS EXTRA: NMBS CONFERENCE 2026
AI WILL BE GAME-CHANGING FOR THE MERCHANT SECTOR
AI is rapidly evolving into a technology capable of carrying out tasks with minimal intervention according to Jonathan Bein, of Distribution Strategy Group.
ARTIFICIAL INTELLIGENCE will transform merchanting over the next five years, delivering significant productivity gains, higher revenues and improved customer experiences.
Bein said the pace of change is unlike anything the industry has experienced before. “We used to have the concept of an internet year,” he said. “AI is changing faster. If we have the concept of an AI year, it might be six or eight weeks.” He explained that while much of the current focus is on generative AI tools such as ChatGPT, Claude and Gemini, the real opportunity lies in applying AI across business operations, customer service, sales, warehousing and supply chain management. He described the next stage of development as Agentic AI, where systems move beyond analysis and recommendations to carrying out actions independently. “Imagine having an agent that books your entire itinerary, figures out the transport, the hotel and the flights and just does it for you,” he said. “That’s where this technology is heading.”
According to Bein, AI is set to have a profound impact on distribution and merchanting businesses, creating what he described as a competitive advantage for early adopters. Companies, he said, could achieve labour savings equivalent to three to five percentage points of operating margin while also generating turnover growth of between 6% and 10%.
Bein argued that the biggest
risk may not be adopting AI too quickly, but moving too slowly. “The first company that gets there in your sector is going to have a really distinct competitive advantage,” he said. “If your competitor achieves three to five hundred basis points of labour savings through AI, they can choose to give some of that back to the market through pricing and take market share.”
While concerns remain about the impact of AI on jobs, Bein suggested the technology is more likely to reshape roles than eliminate them outright. “A lot of what’s happening now is AI replacing repetitive tasks,” he said. “Companies are not directly tying AI to layoffs. It’s about redeployment, reskilling and moving employees to higher- value work.”
He said that AI-powered cross-selling and reorder prediction tools can identify opportunities based on customer behaviour, geography, seasonality and purchasing history. He also pointed to quote and order automation as one of the most immediate opportunities for merchants. “A company had a 47-line quotation completed in 15 minutes and it was perfect,” he said. “That kind of speed and accuracy is very powerful.”
Warehouse operations are also set for significant change, according to Bein, with AI- driven task management, autonomous mobile robots and robotic picking systems becoming increasingly viable. “The merchant sector is
July 2026
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probably three or four years behind in understanding what robotics can do,” he said, stressing that businesses do not need to begin with large-scale automation projects. Instead, they should focus on proven, lower-cost opportunities capable of delivering rapid returns. Key Takeaways from Jonathan Bein’s Presentation • AI is evolving rapidly, with innovation cycles measured in weeks rather than years. • Agentic AI is the next major step, moving beyond generating information to completing tasks autonomously. • Early adopters stand to gain the most, with potential labour savings of three to five percentage points and turnover growth of 6% to 10%. • Quote and order automation is one of the quickest wins, reducing processing times dramatically while improving accuracy. • AI-powered cross-selling, substitute recommendations and reorder prediction can increase sales and customer retention. • Customer service functions could be heavily automated by 2028, allowing staff to focus on higher-value interactions. • Warehouse productivity can be improved through AI-driven
orchestration, robotics and autonomous mobile robots. • AI-enhanced accounts receivable systems can improve cash flow and reduce administration costs. • Demand forecasting and inventory management tools can improve product availability while reducing stockholding costs. • Success depends on starting small, proving value and scaling gradually across the business.
Bein urged delegates not to view AI simply as a more sophisticated search engine but as a strategic business tool capable of transforming productivity and competitiveness.
“The challenge is to go beyond using ChatGPT as a glorified search engine,” he said.
Bein argued that agility would become more important than size in determining future success in distribution businesses.
“We believe it is more that the swift will beat the slow, more than the large will beat the small,” he said. “AI will make you more efficient, more effective and, in many cases, deliver a better experience for your customers. The companies that move first will have a significant advantage.” BMJ
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