Distribution is a margin business. Every order line, every service you wrap around a product, and every hour of coordination either builds profitability or quietly erodes it. Yet the core of how most distributors compete hasn't fundamentally changed: sell the product, ship it fast, and hold the price as best as possible.
The problem is that price is a shrinking advantage. Catalogs are increasingly commoditised, customers can compare in seconds, and there is always a competitor willing to go a point lower. The distributors that will lead their markets in the years ahead are the ones rethinking this model now—moving from selling products to delivering outcomes.
Two forces make that shift practical today: a renewed focus on value-added services and the arrival of industry-specific artificial intelligence (AI) agents that make those services profitable to operate at scale.
Service orders pull components from multiple suppliers with different timelines, so items sit in the cross-dock while a kit waits to be completed. Exceptions pile up because custom work rarely fits a standard process. Availability checks, substitutions, sourcing decisions, and customer documentation require hours of manual, screen-hopping effort. The knowledge that keeps it all moving lives in the heads of a few experienced people—and that knowledge walks out the door when they leave.
These aren't abstract issues. They translate directly to compressed margins, slower fulfilllment, and an over-reliance on employees. The service is valuable, but the cost and complexity of delivering it can erode the margin it was supposed to protect.
Most distributors operate between the first two levels. The leap to the third is where the step change in profitability happens.
Infor CloudSuite™ Distribution and Infor CloudSuite Distribution Enterprise are distribution-specific enterprise resource planning (ERP) solutions where the work comes together. Infor Industry AI Agents add a digital workforce of role-based, micro-vertical agents infused with distribution context and connected to your real data and processes—designed to deliver value from day one rather than after months of tuning.
The Infor Agentic Orchestrator coordinates those agents on multi-step processes, with supervisor-led routing, native Model Context Protocol (MCP) connectivity to Infor and non-Infor systems, and the observability to see what agents are doing and why.
Infor Velocity Suite packages the agents, embedded generative AI (GenAI), process mining, and automations with the expertise to move from a single use case to production—directly answering the pilot-that-never-scales problem.
Rather than replacing your team's judgment, the agents augment it. They absorb the repetitive coordination that makes value-added services expensive, so your experienced people can focus on the relationships and decisions that differentiate you.
In field service, GenAI image recognition lets a technician photograph an unknown part and instantly receive an identification, troubleshooting steps, an inventory check and an order prompt. Each of these is a value-added service enabler dressed as an efficiency feature—faster service, fewer errors and margin protected along the way.
Partnering with Infor, OTC Industrial Technologies uses Infor CloudSuite Distribution and the integrated Infor Service Management solution to effectively manage its customer service agreements, rental contracts, and other projects associated with its value-added services. For its “Air-as-a-Service” offering, OTC leverages embedded Infor Industry AI for proactive maintenance to predict when components will need to be replaced, keeping the revenue stream flowing and customers happy.
The impact goes beyond the margin line. Faster, more reliable value-added services deepen customer relationships and make you harder to displace. Consistent execution builds trust, while reducing reliance on tribal knowledge makes the business more resilient. When your team is supported by agents that handle the coordination, they can focus on what they do best: serving customers and winning deals.
The question isn't whether AI will change how distributors deliver value-added services. It's whether you'll be leading that change or reacting to competitors who already are.
Ready to see what value-added services and Infor Industry AI Agents can do for your margins? Visit Enterprise AI Software Solutions | Infor Industry AI to learn more about AI agents built for distribution and the impact they can have on your business.
The problem is that price is a shrinking advantage. Catalogs are increasingly commoditised, customers can compare in seconds, and there is always a competitor willing to go a point lower. The distributors that will lead their markets in the years ahead are the ones rethinking this model now—moving from selling products to delivering outcomes.
Two forces make that shift practical today: a renewed focus on value-added services and the arrival of industry-specific artificial intelligence (AI) agents that make those services profitable to operate at scale.
The margin challenges distributors face today
If you run a distribution business, these problems likely sound familiar. Value-added services—including kitting, light assembly, custom packaging and labelling, vendor-managed inventory, configuration, technical support—are where differentiation and margin actually live. But they are hard to run profitably.Service orders pull components from multiple suppliers with different timelines, so items sit in the cross-dock while a kit waits to be completed. Exceptions pile up because custom work rarely fits a standard process. Availability checks, substitutions, sourcing decisions, and customer documentation require hours of manual, screen-hopping effort. The knowledge that keeps it all moving lives in the heads of a few experienced people—and that knowledge walks out the door when they leave.
These aren't abstract issues. They translate directly to compressed margins, slower fulfilllment, and an over-reliance on employees. The service is valuable, but the cost and complexity of delivering it can erode the margin it was supposed to protect.
Where does your organisation stand?
Value-added service maturity in distribution tends to fall into three levels. Understanding where you sit helps clarify the opportunity ahead.Most distributors operate between the first two levels. The leap to the third is where the step change in profitability happens.
How Infor supports value-added services with Infor Industry AI Agents
Infor™ approaches this as an industry-cloud company: The software is built for the specifics of distribution rather than offered as generic technology that teams must adapt to. That industry focus is the foundation for everything below.Infor CloudSuite™ Distribution and Infor CloudSuite Distribution Enterprise are distribution-specific enterprise resource planning (ERP) solutions where the work comes together. Infor Industry AI Agents add a digital workforce of role-based, micro-vertical agents infused with distribution context and connected to your real data and processes—designed to deliver value from day one rather than after months of tuning.
The Infor Agentic Orchestrator coordinates those agents on multi-step processes, with supervisor-led routing, native Model Context Protocol (MCP) connectivity to Infor and non-Infor systems, and the observability to see what agents are doing and why.
Infor Velocity Suite packages the agents, embedded generative AI (GenAI), process mining, and automations with the expertise to move from a single use case to production—directly answering the pilot-that-never-scales problem.
Rather than replacing your team's judgment, the agents augment it. They absorb the repetitive coordination that makes value-added services expensive, so your experienced people can focus on the relationships and decisions that differentiate you.
Value-added services in action
The impact shows up in everyday workflows. A new 360-degree product line view in order entry consolidates availability, substitutes, pricing, sourcing, and upsell opportunities onto a single screen—so a clerk stops toggling between windows and captures cross-sell and margin at the point of quote. New cross-docking controls let you choose exactly which order types, including kits and value-add orders, are eligible for cross-docking, so complex service orders stop clogging the dock.In field service, GenAI image recognition lets a technician photograph an unknown part and instantly receive an identification, troubleshooting steps, an inventory check and an order prompt. Each of these is a value-added service enabler dressed as an efficiency feature—faster service, fewer errors and margin protected along the way.
How OTC Industrial Technologies transformed value-added services
OTC Industrial Technologies, a leading industrial distributor, generates additional revenue streams through a variety of value-added service offerings such as air preparation and filtration service, in-house repairs, field service and maintenance, assembly, and more. These value-add solutions are customisable to meet the needs of individual businesses, helping to enhance efficiencies and increase throughput.Partnering with Infor, OTC Industrial Technologies uses Infor CloudSuite Distribution and the integrated Infor Service Management solution to effectively manage its customer service agreements, rental contracts, and other projects associated with its value-added services. For its “Air-as-a-Service” offering, OTC leverages embedded Infor Industry AI for proactive maintenance to predict when components will need to be replaced, keeping the revenue stream flowing and customers happy.
The margin opportunity is bigger than you think
For a distributor doing hundreds of millions in revenue, even a few points of margin improvement is not an incremental gain—it's transformational.The impact goes beyond the margin line. Faster, more reliable value-added services deepen customer relationships and make you harder to displace. Consistent execution builds trust, while reducing reliance on tribal knowledge makes the business more resilient. When your team is supported by agents that handle the coordination, they can focus on what they do best: serving customers and winning deals.
Moving from transactional to indispensable
The distributors winning today aren't just adding services—they're rethinking how those services get delivered, moving from a model built on manual effort and individual judgment to one built on data, coordination and speed. Value-added services move the conversation from price to value; Infor Industry AI Agents make delivering that value more efficient, helping you scale profitably. Together they raise margin and lower the cost of earning it—while turning you from a supplier a customer can swap into a partner they can't easily replace.The question isn't whether AI will change how distributors deliver value-added services. It's whether you'll be leading that change or reacting to competitors who already are.
Ready to see what value-added services and Infor Industry AI Agents can do for your margins? Visit Enterprise AI Software Solutions | Infor Industry AI to learn more about AI agents built for distribution and the impact they can have on your business.
Hakan Strombeck
Industry & Solution Strategy Director, Infor
Håkan Strömbeck, Director of Industry & Solution Strategy, specializes in the Distribution industry at Infor. With a diverse background spanning various software companies, from startups to global solution providers, Håkan brings a wealth of experience to his role.
Beyond the realm of software, Håkan has immersed himself in operational roles across different companies and served as a management consultant for global firms. Throughout his career, he has consistently emphasized the dynamic interplay between people, processes, and systems.
In his current role, Håkan is shaping and guiding the strategic direction for Infor’s capabilities in the distribution industry. To be curious and humbly challenge current structures and way of working Håkan want to help Infor’s customer be prepared for the future and embrace innovations.
Håkan is an appreciated speaker and enjoys be involved with Infor’s customers.
Originally Håkan studied finance where he hold an MBA but has spent most of hi career in the are of systems and solutions.