Why This Matters to Distributors: UNFI is moving AI into core distribution functions, including procurement, transportation, and warehouse operations. Its reported gains in delivery performance, inventory management and productivity illustrate how distributors are increasingly using AI alongside lean management practices to drive measurable operational improvements across large distribution networks.
United Natural Foods Inc. (UNFI) has completed a network-wide rollout of an artificial intelligence-powered supply chain planning platform and is expanding AI-driven transportation and warehouse technologies as the food distributor seeks to improve productivity, inventory management, and service levels across its operations.
The Providence, Rhode Island-based distributor said the AI-powered supply chain and procurement planning system is now deployed across all its distribution centers, with work continuing supplier-facing capabilities.
CEO Sandy Douglas said the platform is already generating operational improvements.
“This platform is already helping to steadily improve fill rates and inventory management while also enhancing free cash flow conversion,” Douglas said during UNFI’s fiscal third-quarter earnings call.
The company is also expanding its use of Samsara’s AI-powered fleet management platform for driver coaching, route optimization, and delivery execution. Through the first nine months of fiscal 2026, on-time deliveries improved more than 4% from the prior-year period while average miles per delivery declined 5%, according to the company.
UNFI also extended its cloud-based warehouse management system to five additional distribution centers during the quarter.
The technology investments are being paired with a lean management initiative that now covers 40 distribution centers, up from 36 in the previous quarter. President and chief financial officer Matteo Tarditi said the combined approach is designed to drive sustainable productivity improvements.
Distribution center productivity increased more than 7% during the quarter, the company reported.
The AI planning platform grew out of a procurement transformation launched in fiscal 2025. Tarditi said UNFI first decentralized its procurement organization before deploying AI- and cloud-based planning tools intended to improve coordination with customers and suppliers.
Executives said the effort has helped reduce day-on-hand inventory and improve working capital performance. Tarditi added that UNFI continues to see significant opportunities to improve efficiency across its approximately $4 billion cost base, including about $2 billion in indirect spending.
On the commercial side, UNFI launched Endless Aisle, a digital marketplace designed to help retail customers discover and test products from emerging brands. The company also hired a new leader for its digital services business, which focuses on technology offerings for customers and suppliers.
UNFI added more than 30 products to its private brands portfolio during the quarter as it seeks to meet growing consumer demand for healthier food options.
Douglas said the company plans to continue investing in commercial and supply chain technology as it prepares for a projected return to wholesale sales growth in fiscal 2027 following a series of network optimization initiatives completed over the past year.
“We see continued opportunities to invest in commercial and supply chain technologies that benefit our customers, our suppliers and UNFI,” Douglas said.
Technology investments coincide with UNFI’s 50th anniversary year and reflect a broader effort to modernize operations across its distribution network as food distributors face ongoing pressure to improve productivity, service levels, and inventory efficiency.
Do not miss any content from Distribution Strategy Group. Join our list.
Share this article:
