How AI Tech Helps Supply Chain Managers Stay Ahead of Challenges

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By Anar Mammadov, CEO — Senpex Technology

Since 2021, toy makers have struggled to resolve various logistics issues caused by the supply chain crisis. Toy brands, manufacturers, and other parties are taking a closer look at what logistics solutions they can implement to continue to fulfill orders. AI technology is one solution adopted to offer consumers better transparency, automate communication, and capture and organize data efficiently because of its dynamic capabilities.

Toy makers have increased revenue by 8% in the last three years, but the NPD Group revealed it’s because the average selling price (ASP) has risen — not the number of toys sold. While companies in the toy industry have managed to do more with less, it’s not a sustainable solution. Conversely, AI technology provides sustainable and scalable solutions.

The core of AI technology is to be dynamic and versatile, which not all logistics services currently provide. Let’s take a look at what components of the supply chain AI technology can improve for toy makers.


Inventory management is about predicting how much product inventory a business needs in a set time frame to exchange or ship immediately when a customer orders it. By predicting and managing how many orders of a product are typically placed, a business understands how much it needs to stock a particular product and how often they need to order a new batch of a product, which requires extremely precise forecasting in every aspect. Overstocking can result in lost revenue, whereas understocking can result in product shortages, creating longer delivery times and resulting in unhappy customers.

AI software helps businesses by automatically learning to analyze consumer demand for specific products with extreme accuracy. AI technology is dynamic because of its ability to monitor and react to evolving trends, account for seasonal shifts, and differentiate calculations for regional-based demands as it stocks inventory. By studying millions of purchases, AI algorithms accurately monitor and foresee when products are being rapidly purchased or sitting idly too long in back rooms.

AI software enables companies to more easily account for order surges, resolve delivery issues, and keep a supply chain moving by ordering based on real-time demand, rather than stocking inventory according to a prediction. Effective inventory management impacts customer satisfaction and whether or not expenses decrease or increase.

AI technology can be configured to trigger automatic responses when inventories run low, enabling businesses to react more quickly in tandem with ready suppliers. It also maintains a database of a business’s suppliers and updates it with current stock. In seconds, AI technology can analyze and make orders based on multiple parameters such as cost, delivery speed, and reliability to suggest the best possible supplier.

How Cloud-Based Software Increases Data Visibility

An intuitive dashboard that allows users to view and manage invoices, track shipments via real-time GPS systems, and organize logistical information is imperative to effectively managing a supply chain. Logistics providers need to be able to integrate seamlessly into advanced company pipelines without altering or disrupting other providers’ operations. This requires a company’s supply chain dashboard to be multi-faceted and equipped with dynamic capabilities applicable to multiple industries.

The way we live continues to evolve, and on-demand delivery services must keep pace. As delivery logistics and solutions improve to become faster and more accurate, business development must also improve with how quickly it can adapt without losing quality.

Streamlining Warehouse Operations

Dark warehouses — fully automated storage facilities that operate entirely free of human labor — are the most recent innovation to be implemented into the supply chain. When the lights go out, the self-driving forklifts, conveyor belts, and automated palletizers continue normal operations and organize the warehouse until workers return. These automated machines powered by AI technology track every item that enters the warehouse, where it’s stocked, and when it leaves the warehouse, all by scanning barcodes and updating inventory information in real-time. By substituting people with automated machines, human error is eliminated and increases productivity.

Additionally, dark warehouses operate 24/7 without expensive heating or air conditioning. Even warehouses that aren’t going completely dark are seeing increased integrations with AI technology. To meet demand, a rising number of storage facilities are integrating their computers and processes with automated conveyor systems and order retrieval technologies.

AI technology streamlines every aspect of warehouse management. Algorithms predict how long each item will be stored, which plays into small efficiency variables like how quickly a product can be transported from the shelves to a truck. Products staying the longest are stocked towards the back, and those leaving quickly are kept close to the front for easy access. Even the size of pallets chosen for storage can vary by inches, determining what type of transportation is needed or what shelf an item is stored on. These types of decisions are made within seconds, automatically and accurately. If left up to human management, errors are more likely to occur, which would cost time and money. While these nuances may seem small, at the end of the day, they make a massive difference in efficiency over thousands of orders.

Optimizing the Shipping Process

AI technology allows each party to monitor their shipments constantly and track them via GPS throughout the shipping process. Managers receive real-time updates as the shipment moves; customers and retailers are immediately alerted if items arrive or are delayed. It starts at the warehouse, and as goods leave, AI technology follows them to the last link of the supply chain.

Sophisticated AI software uses graph theory to simplify a city map and its moving parts into nodes, edges, and vertices. The technology accounts for peak traffic situations and integrates information systems to track emerging traffic conditions. Algorithms combine available traffic information with the list of delivery destinations, batching orders together to create the most efficient pickup and drop-off schedule for each driver. It creates shipping routes optimally balanced between speed and cost savings in seconds. In the event that a customer cancels an order or makes a last-minute change, the software is able to adjust while on the road.

Today, AI remains a capable backseat driver. In the not-so-distant future, however, autonomous vehicles will likely take over the steering, as well. Innovations in AI technology are revolutionizing every aspect of inventory management. Companies are increasing revenue and customer satisfaction thanks to emerging solutions in how businesses stock, store, and ship products.

One thought

  1. I am glad that the managers are doing well with this given that AI is such a strong innovation that we are looking forward to. I feel like it will only improve with the changes that we can keep looking into and I am glad that you are here which is nice to think about. I feel like there are some good challenges that we are seeing here and I am glad that you are checking this out for people to dive into. Have you tried it out for yourself? There are some interesting ways that we can keep looking into and I feel like it will be good to see all of the tech that you can keep looking into. I feel like it will only improve from here given that there are tons of challenges that you can keep looking into with all the effective uses you can see here. I hope that the tech will continue to improve with all of these.

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