How Walmart, Amazon and other retail giants are using AI to reinvent their supply chains – from warehouse to checkout

In an age of tariffs, labor shortages and global uncertainty, its mission has become more important than ever. According to the recent nvidia The survey found that companies are feeling pressured, with 59% of respondents saying the supply chain challenge has increased over the past year. Companies are turning to AI to address these challenges, with 82% planning to increase spending on AI-powered supply chain tools next fiscal year.

Last week, Walmart, the world’s largest retailer, announced it has improved its global supply chain using real-time AI systems. The technology, first deployed in the US, currently lives in markets in Costa Rica, Mexico and Canada. These tools help track consumer trends, design product assortment, forecast demand, move inventory to higher areas, and reduce excess inventory. According to Walmart, projects that once took months can be completed in weeks.

For example, Walmart has developed a system called Trend-to-Product that tracks trends, tracks AI-driven multi-agent engines (using social media, search data, etc.), generates mood boards and product concepts, and supplies them directly to the prototyping and sourcing process.

“On this scale, the only way to move faster is to move smarter,” said Vinod Bidarkoppa, chief technology officer at Walmart International, in a blog post. “We’ve created a system that turns real-time signals into real-time actions, freeing up associates and providing them to our customers.”

Walmart’s top rival Amazon also highlights advances in its AI-powered supply chain. At the company’s Re: Invention Event, at the 2024 invention event, CEO Andy Jassy spoke widely about how continuous improvements in the supply chain can save several pennies per billion-dollar package on a massive scale of billions of dollars.

Last month, Amazon Share A blog post introducing large-scale new investments in AI applications that solve the logistics challenges of global supply chain: Wellspring, Generated AI Mapping Technology. A demand forecasting model equipped with AI that powers Amazon’s supply chain. New robotic features using agent AI systems.

“These systems work behind the scenes, but customers certainly experience benefits. They have more accurate delivery locations, faster delivery options, and improved availability of the products they want when they need them,” the blog post states.

From predictions to full-on AI automation

Retailers have modernised their supply chains for over a decade using tools such as cloud-based software, AI analytics, and connected sensors. These technologies have helped us plan more accurately, track inventory and improve order accuracy.

It accelerated during the Covid-19 pandemic as shortages, surges in demand and disruptions in the supply chain forced businesses to adapt. Services such as same-day delivery and Buy Online have arrived from convenience to necessities. It has been part of the baseline ever since.

However, the current wave of AI deployments is different, says Manish Kapoor, founder and CEO of Growth Catalyst Group. The previous system was helpful, but most were reactive. This relied on historical data for forecasting or route planning.

“Now, AI operates in real time with predictive and normative capabilities,” Kapoor says. “These systems can automate operations, reroute in-place shipments, rebalance inventory across locations, risk of flag allocation before causing destruction, and even automatic checkout in stores.”

According to Venky Veeraraghavan, Chief Product Officer of AI Platform Datarobot, it’s the rise in agent AI that will drive the next leap. This is a system that allows for complex tasks to be performed with minimal human involvement.

“The rise of agent AI offers a huge opportunity to increase productivity,” he said. “Planners can use natural language to trigger tasks and receive guided analytics, aggressive insights, and automated problem identification. This new generation of AI can coordinate automation across the supply chain in ways that are impossible to ever do.”

result? More efficient planning, fewer inter-sector silos, better use of working capital, and significantly less waste.

“AI is reshaping the supply chain, and some of the most transformative use cases come from systems of AI agents,” said Garth Hoff, Industry Strategy Director at PriceFX. “AI has become an essential tool for forecasting and inventory planning. With tariffs, timing is everything. If inventory is overloaded or demand is not too high, it hits the margins directly. AI can sense the shift in demand for a brand earlier and help simulate how sourcing and tariff scenarios affect costs.”

Albertsons Currently, move products and store shelves 15% faster

For Albertsons, one of the largest food and drug retailers in the United States with over 2,200 stores in 35 states, AI is used not only to forecast and optimize, but also to rethink how stores interact with the supply chain in real time.

Chandrakanth Puligundla, Tech Lead and Data Analyst at Albertsons, gave examples of how retailers can use AI to help allocate store labor for receiving and restocking.

“The model for predicting daily inbound shipments was built to match available store labor,” he explained. “That matching allows teams to staff in the right way to handle all delivery without overstaffing or delays.” Albertsons currently moves products from loading docks and keeps shelves about 15% faster during peak shopping season.

A new trend he added is using AI to analyze unstructured supplier information, such as emails and PDFs. This technology extracts key details about delivery changes, risks and commitments, and helps procurement teams avoid issues that are often overlooked in traditional systems.

“In the retail supply chain, AI is great at clarifying complexity, ensuring that frontline teams respond quickly and effectively,” he said.