I was looking up a product on our website, and my own browser flashed a tantalizing message: “This item is available elsewhere for $XX,” with a link to a competitor’s website.
That’s when I knew that big changes were afoot in our world. If my browser was offering me unsolicited advice on where to find better prices on the items we sell, our customers’ browsers are going to be showing them the same thing.
From the perspective of the buyer, unleashing AI to scour the internet for better deals is one of the many benefits of this brave new world of machine learning. It’s nice to know if the prices you’re paying are competitive with the market. If nothing else, you can use this intelligence to challenge your current supplier to make a price concession.
The advent of AI has no doubt also disrupted the way you market your pallet business. The landscape is changing, and we all have to adjust our message and methods to make sure we’re not only appealing to our human customers, but also to get the attention of the robots who the humans are relying on for recommendations.
Yes, the landscape is changing, but there are some things that will never change. It’s imperative we reinforce those considerations with the humans who make the buying decisions before they get carried away by an attractive price and forget what led them to your door in the first place.
The wise buyer understands that the cheapest option isn’t always the most cost-effective. In fact, the more expensive supplier often delivers hidden advantages that AI may undervalue or overlook entirely.
It’s Hard to Beat AI’s Speed, Consistency and Reach
AI excels at tasks that require pattern recognition and rapid analysis. In purchasing, that translates into automated price comparisons across dozens of vendors, among other things.
AI also brings consistency—every supplier is evaluated using the same criteria, without human bias or fatigue.
For commodity items, this is ideal (although sometimes even commodity items aren’t created equal, as you will read below). When the product is standardized and the only meaningful differentiator is price, AI’s precision is a major asset. But purchasing isn’t always that simple.
What’s Missing from the Equation
Procurement decisions often involve factors that are difficult to quantify. AI can analyze historical data, but it struggles with the intangible elements that seasoned purchasing professionals weigh instinctively.
1. Service Quality and Responsiveness
A supplier that charges more may also ship faster, resolve issues immediately, provide dedicated account support and offer flexible terms during emergencies. These qualities rarely show up in a spreadsheet, yet they can save a company far more than the price difference.
2. Reliability Under Pressure
Selling at below-market prices is a lot easier to do when you don’t worry about the long game. A quality supplier will align itself with reputable vendors and time-tested supply chains that aren’t likely to collapse at the first sign of stress. AI evaluates past performance, but it cannot fully predict how a supplier will behave during a crisis—supply chain disruptions, natural disasters, labor shortages or sudden demand spikes. Experienced buyers know which vendors will “go to bat” for them when it matters most. That loyalty has real economic value.
3. Innovation and Expertise
Higher-priced suppliers often invest more in R&D, testing and product improvements, safety and compliance, and technical support and understanding of your industry. They may help a customer redesign a process, reduce waste or improve efficiency. Those gains rarely appear in a simple price comparison.
4. Depth of Commitment to the Customer’s Industry
Is it worth paying more to get supplies from a vendor who is invested in your industry? Your browser doesn’t factor this in at all. In the case of vendors who market to the pallet industry, some suppliers support your industry by joining your industry’s trade associations, visiting pallet shops to gain insight into how you use the supplies you consume, advertising in your trade magazines to continue to provide you with informative content and participating at pallet trade shows.
Why do they invest in these things? Because they see value in investing in the future of the industry. They also believe understanding the pallet industry makes them competitive in other respects, especially when it comes to offering products proven to work in a pallet shop instead of products that look like they might work.
A recent example illustrates this perfectly. We had a customer ask us why our railroad chalk cost so much more than the chalk recommended by their browser. Chalk. What could be more of a commodity than chalk, right? And this customer’s browser was showing them chalk priced significantly less than ours.
Out of curiosity, we placed an order ourselves to better understand the reason for the price discrepancy. When it arrived, we understood the reason immediately. This chalk was the cigarette-sized schoolroom blackboard chalk that differs drastically in composition from our railroad chalk. It’s perfect for writing math equations on a chalkboard, but it’s absolutely frustrating to use for marking on pallets. The browser couldn’t tell the difference, but we could see it in an instant.
5. Soft Costs
Avoidable soft costs can be likened to taking a shortcut through a field only to find your socks and pants coated with Velcro-like weed seeds that now must be painstakingly picked off. Recovering from the “shortcut” took more time than what was saved by the shortcut. Or a more business-themed example: You find yourself on hold with a vendor because they are “experiencing an ‘unusual’ amount of call volume” and you realize the vendor considers it a cost savings to take up more of your time in exchange for understaffing their customer service department. This expense doesn’t appear on a spreadsheet, and AI doesn’t generally consider the soft cost consequences on a given buying scenario.
Soft costs are the busy work you and your staff expend that could be allocated more profitably elsewhere. Here are some more examples: extra time spent when your shipment is received with an anomaly, backorders, damaged goods, picking/count errors, extra time spent receiving in multiple shipments that could have been consolidated into a single shipment from one vendor on one P.O. and returns and warranty claims.
Your customers experience avoidable soft costs when they deal with a less reliable pallet company that doesn’t deliver on time or sends pallets that don’t match the grade specified.
A low-cost supplier with inconsistent quality can quietly erode margins because you and your team are getting less profitable work done. A more expensive supplier with higher reliability can reduce total cost—even if the unit price is higher.
The Human Advantage: Judgment and Strategic Insight
AI is a powerful tool, but it is not a replacement for human judgment. The best purchasing teams use AI to handle the heavy lifting while they focus on strategic evaluation.
Human buyers understand:
- The political dynamics inside their own organization
- The operational realities on the warehouse floor
- The long-term implications of supplier relationships
- The difference between “price” and “value”
AI can recommend the lowest bid. Humans determine whether that bid makes sense.
Why the More Expensive Supplier is Sometimes the Better Investment
Organizations that rely solely on AI-driven price optimization risk creating fragile supply chains. The lowest-cost supplier may not be the one that keeps your production line running, supports your team or protects your brand.
Paying more can be justified when a supplier delivers:
- Higher quality that reduces rework
- Fewer stockouts, especially on those critical items essential to production
- Faster lead times that prevent downtime
- Better communication that avoids surprises
- Stronger compliance that reduces legal exposure
- Partnership-level support that improves operations
These benefits compound over time, often dwarfing the initial price difference.
The Future: AI + Human Expertise Working Together
The most effective purchasing pros will not choose between AI and human judgment; they will combine them. AI will continue to streamline data-heavy tasks, while humans will provide the strategic insight that algorithms cannot replicate.
The result is a smarter, more resilient procurement function that recognizes value in all its forms—not just the lowest number on a quote.
Editors’ Note: Dustin Howard is an industry specialist for HUB Industrial Supply. To see HUB’s catalog of quality products designed specifically for the pallet industry, visit www.hubindustrial.com.
