In today's market, growing profitably takes more than scale. It takes the ability to act on what is changing in real time. Yet too many distributors still make inventory decisions using outdated forecasting models, manual spreadsheets, and the legacy knowledge held by a few long-tenured people. These decisions directly affect cash flow.
Think about your own business. Is your inventory positioned where and when demand actually needs it? Do your procurement teams have the information they need at the point of the order decision to avoid stockouts without overstocking? Is working capital tied up in the wrong products, or quietly locking up cash you could be putting to work somewhere else?
The inventory challenges distributors face today
If you run a distribution business, the pattern is familiar. Replenishment logic was set years ago and is rarely reviewed. Buyers fill the gaps with judgment, and the experienced ones are genuinely good at it, which is precisely the problem: none of that reasoning is written down. New buyers need months before they can commit to a stocking level with confidence, and when a veteran buyer leaves, the intelligence leaves with them.
The inputs that should drive those decisions are scattered. Historical orders sit in one system, supplier lead-time performance in another, product attributes and customer buying patterns somewhere else, and market pricing signals outside the business entirely. By the time any of it reaches the person placing the order, it is out of date. Working from stale inputs, buyers do the rational thing and buffer, which is how carrying costs climb while stockouts keep happening anyway.
Where does your organization stand?
Inventory intelligence maturity tends to fall into three levels. Knowing which one describes your business clarifies how much working capital is likely still sitting on the shelf.
Most distributors operate somewhere between the first two levels. The move to the third─where replenishment guidance is continuous, contextual, and delivered inside the systems buyers already use─is where the working capital release happens.
How Infor AI inventory optimization works
Infor's embedded artificial intelligence (AI) inventory optimization is built on the Infor™ Industry Cloud Platform and powered by Amazon Web Services® (AWS®). It draws on historical orders, product attributes, customer characteristics, pricing and promotions, and external market influences to recommend what to stock, where to hold it, and when to reorder.
With predictive insights working behind the scenes, your team receives replenishment guidance inside their everyday workflows, based on demand, lead times, seasonality, and supplier reliability. The result is consistent stocking decisions that reduce holding costs and lost sales, freeing up working capital in the process. There is no separate application to open and no workflow to interrupt.
Real results: How Team Air Distributing cut sourcing time to 60 seconds
Team Air Distributing is a leading wholesale distributor of residential and commercial heating, ventilation, and air conditioning (HVAC) equipment, parts, and supplies, managing inventory across 18 branches in the Southeast.
Sourcing product to fulfill a customer order used to mean manual investigation: switching between screens, depending on colleagues, and following a different path every time. Each search took 5 to 15 minutes, and the outcome was often an unnecessary new purchase or an expedited shipment that quietly eroded margin.
Team Air deployed Infor CloudSuite™ Distribution with the Infor AI Inventory Optimization Agent embedded directly into its order workflows. The agent returns the right branch location for sourcing─no screen switching, no reliance on other team members, and no investigative path required.
Sourcing decisions that once took 5 to 15 minutes now take approximately 60 seconds. Unnecessary new purchases have been eliminated, and expedited shipping costs have come down across the entire branch network.
Alisha Thompson, Chief Technology Officer, Team Air Distributing
The working capital opportunity is bigger than you think
Inventory improvements compound in a way that single-metric business cases tend to understate. Release stock you never needed and you free cash immediately. Hold fill rates while you do it and you protect the revenue that excess was supposedly insuring. Give purchasing teams back the time they lose spending on every search and that capacity returns to supplier negotiation and exception handling, which is where they create the most value anyway.
The effects reach past the balance sheet. Faster sourcing means fewer lost orders. Consistent stocking decisions build customer trust. Less dependence on legacy knowledge makes the business more resilient when experienced people move on.
Moving from reactive to optimized
The distributors winning on working capital are not simply buying better forecasting tools. They are changing what drives the stocking decision, moving from inherited rules and individual judgment to a system that reads current conditions and recommends accordingly. Infor's AI inventory optimization makes that shift practical. It meets buyers where they already work, and it turns every replenishment decision into a chance to protect both service levels and cash.
The question is not whether AI will change how distributors manage inventory. It is whether you will be setting that pace or catching up to competitors who already are.
Ready to see what your inventory could be doing instead? See what's possible with Infor CloudSuites for Distribution