Managing pricing with AI
The pricing process, which is central to your business, has been significantly influenced by AI. As a consultant in the welding and gases industry, I’m frequently asked by distributors which AI software can provide the best chance for short-term return on investment (ROI). Therefore, AI applications for pricing rank at the top of their priority list. I recommend appointing a Pricing Czar to oversee the complexities involved in integrating AI into your pricing strategy.
What the Data Says
The National Association of Wholesale Distributors’ (NAW) 2026 survey data (naw.org) ranks these as the top three business areas for distributors to apply AI technology:
- Pricing is the top priority overall. 27% of distributors ranked pricing as their number one AI priority, making it the leading category. Even small gains in price realization can meaningfully boost operating profit, and AI can identify these.
- Inventory and demand planning is a close second priority. 21% of respondents ranked this as their top target for AI applications. Also, AI is a valuable tool for demand forecasting. It enables you to better balance carrying costs against stockout risk.
- Sales/CRM productivity: AI embedded in CRM tools is the third highest priority. Embedding AI in your sales and CRM processes improves productivity as it allows you to draft outreach and follow-ups based on a buyer’s recent activity, previous meeting notes, and current industry trends. This lets reps scale outreach without losing personalization (human review still expected before sending).
Time to Act
It’s time to take advantage of AI. According to Ian Heller of DSG (Distribution Strategy Group), “Companies that hesitate [to adopt AI] will lose ground to competitors using AI to reduce costs, improve service and make faster, smarter decisions.”
Large distributors have already made huge investments in this technology. Moreover, that investment has lowered the cost of entry for distributors with annual revenues under $20M.
The Pricing Czar
Customer satisfaction improves with better pricing, because your clients ultimately get better service. Select a person to spearhead the work as your Pricing Czar and keep your customer in mind. Also, making price a focus of your current SOP. Your Pricing Czar should look at pricing every day. Lastly, naming a Pricing Czar isn’t a luxury move anymore — it’s the next logical step for any distributor serious about staying competitive.
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