Dollar General Taps AI Produce Ordering as Grocers Automate Procurement

Dollar General is using artificial intelligence to optimize its fresh produce buying, as across the grocery industry, retailers are tapping automated solutions to improve their purchasing decisions and boost efficiency.

The discount chain is expanding its use of AI from solution provider Shelf Engine, which offers demand forecasting capabilities and other inventory insights, to 3,000 stores by the end of the retailer’s 2023 fiscal year in early February, Progressive Grocer reported.

“Adopting Shelf Engine’s AI solutions aligns seamlessly with our mission of serving others, helping our teams enhance value and convenience for our customers,” said Allen Warch, vice president of food and fresh merchandising at Dollar General, per the report. “This collaboration is a strategic step toward improving our operational efficiency while serving our customers with improved in-stock levels of fresh produce.”

The news comes as discount retailers are increasingly looking to serve consumers’ day-to-day grocery needs. In December, Dollar General CEO Todd Vasos highlighted market share growth, both in terms of dollars spent and the number of products sold, in “highly consumable” categories. Similarly, Dollar Tree shared on its earnings call in November that its sales mix has been shifting toward consumables, and sales in the category have grown low-double-digits.

Plus, businesses across the grocery supply chain are increasingly looking to AI to boost their margins. Grocery wholesaler giant United Natural Foods Inc. (UNFI) announced Monday (Jan. 29) that it intends to use AI capabilities from warehouse automation company Symbotic at its latest distribution center.

“We always want to make doing business with UNFI easier for our customers and suppliers, and that means investing in ways to make our supply chain more effective and efficient,” UNFI Chief Operating Officer Erin Horvath said in a statement.

Back in November, grocery giant Albertsons announced the rollout of AI-powered solutions from food supply chain technology company Afresh to improve decision-making around its meat and seafood inventory.

Many grocers are looking for smarter insights. The PYMNTS Intelligence study “Big Retail’s Innovation Mandate: Convenience and Personalization,” which drew from a survey of 300 large retailers in the United States and the United Kingdom, found that 37% of grocers were innovating on their data analytics capabilities.

Overall, businesses are increasingly turning to AI to boost efficiency. For instance, research highlighted in the “Understanding the Future of Generative AI” edition of the “Generative AI Tracker®” revealed that around 40% of executives said there is an urgent necessity to adopt generative AI, and 84% of business leaders said generative AI’s impact on the workforce will be positive.

Last month, a report showed that 37% of the 750 AI-using business leaders interviewed in a survey by ResumeBuilder said that AI replaced workers last year, while 44% said there will be job cuts this year due to AI efficiency.

“AI can help organizations respond to disruptions by helping in several ways, whether it is reducing your waste, whether it is your demand forecasting, or even optimizing your resource usage,” SymphonyAI Industrial President and CEO Prateek Kathpal told PYMNTS in an interview posted in December for the “Matchmakers” series.

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