A place for AI in HVAC wholesaling

Artificial intelligence (AI) isn’t always top of mind for HVACR wholesalers and distributors. Nonetheless, it is a fast-evolving technology that poses game-changing benefits to any industry player who puts it on their radar.

And then, it's hard to ignore the buzz around AI. Self-learning and autonomous technologies are finding their way into every sector, offering ways to perform repetitive or mundane tasks faster, safer, and more efficiently. For HVACR wholesalers and distributors, AI has the potential not only to spark more effective operations but also charge forward with more informed, data-driven strategies.

“Today, the use of AI in HVACR distribution is really about improving or defending even the distribution business model,” says Mark Dancer, CEO of Network for Business Innovation and host of HRAI's Re-Thinking Distribution webinar series. "Distributors are very sales-driven, as opposed to marketing-driven, so the question they can be asking is 'how can AI improve my sales?'"

There are several answers to that question, many of which are on the radar of industry veterans like Eric Groulx, Digital Services Leader at Trane. Through the use of AI technologies and systems, he says wholesalers and distributors can wield data across their operations to upgrade operations across the board, noting, "AI can help streamline and optimize the distribution process for HVAC products, leading to improved efficiency, reduced costs, and enhanced customer satisfaction.”

Potential uses of AI in HVAC product distribution include:

  • Enhancing demand forecasting: Leveraging data from across an organization to anticipate customers' purchasing activities. As Groulx explains: “AI algorithms can analyze historical data, market trends, and other relevant factors to accurately predict the demand for HVAC products in different regions. This helps manufacturers and distributors optimize their inventory levels and ensure that the right products are available at the right time.
  • Customer segmentation: Using AI to analyze customer data and segment them based on their preferences, buying behaviour, and other relevant factors. “This allows distributors to tailor their marketing and distribution strategies to different customer segments, improving customer satisfaction and increasing sales,” explains Groulx.
  • Find the"sweet spot" for pricing: Using advanced data analytics to identify, understand, and adapt to customer spending habits and pricing opportunities.
  • Inventory optimization: Using AI’s predictive capabilities to plan and manage their inventory levels more effectively.
  • Support supply chain management: Actively tracking activities throughout one’s supply chain to detect and respond to opportunities for cost savings, efficiencies, and other improvements.
  • Create “smart” warehouses: Integrating autonomous equipment and AI-enabled back office platforms.
  • Improve preventative maintenance: Using equipment maintenance and performance data to plan repairs, replacements, or general upkeep in advance, thereby avoiding surprise breakdowns. Says Groulx: “This helps distributors and manufacturers to proactively schedule maintenance visits, reducing downtime for customers and improving overall customer satisfaction.”
  • Fraud and cyberattack protection: Leveraging AI’s vast data-crunching might to keep a vigilant watch on one’s digital network and detect and respond to potential threats.
  • Chatbots and virtual assistants: Introducing customer-facing, AI-powered tools to provide instant support for product inquiries, troubleshooting, and order tracking.

The potential for AI to transform HVACR wholesaling and distribution is immense. That potential applies from the front lines to the back office. Yet, as with all AI technologies and platforms, that potential is only possible through a foundation of solid data.

“You see the big and forward-looking distributors doing this already,” says Dancer. “They’ve invested in cleaning up their data and pulling it all together and making it actionable, which is essential because the more robust the data, the more value it creates.”

Taking it one step further, he adds, Incorporating more AI-enabled data analytics in the HVACR wholesaling and distribution world can also benefit the community at large: “Once you can use data to improve sales, the next question may be, ‘How can I use that data to help the community I serve, whether that means using the data to support economic development or find solutions for worker shortages.”

“There’s a huge amount of knowledge to be gained when we put our data to good use through AI,” he adds.

Granted, joining the AI revolution can seem daunting. Herein, there is a benefit to taking smaller steps towards its adoption. That begins by looking across one’s operations to identify ways in which AI can be implemented to solve existing pain points or bring immediate benefits, and then going to market for AI solutions that fit.

From there, organizations can launch pilot projects and further tests to determine where AI fits throughout their operations.

The AI revolution isn’t coming; it’s here. And while any transformation can be tricky, benefits await HVACR players who take the time now to explore how AI can set them up for the future.

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