Walmart is now utilizing AI to streamline the negotiation process with their suppliers, and apparently suppliers are loving it according to a recent report from Bloomberg. The chatbot developed by Pactum AI, an artificial intelligence technology company based in Mountain View, California, can help the retail giant close deals in days rather than weeks or months.
The chatbot operates by Walmart setting the budget and priorities, and then the software negotiates with vendors. It can negotiate discounts, payment terms, prices for individual products, and compares current vendor deal offers with past ones and what other companies are paying. Out of the 75 percent of vendors surveyed by Walmart, three fourths of them liked the process of dealing with the robot more than dealing with a human negotiator.
Walmart has been utilizing artificial intelligence for a few years now with initiatives such as a text-to-shop tool allowing customers to communicate with a robot and to text what products they want to purchase and a chatbot providing information to shoppers on their app and website. However, in February Walmart Global Tech, the retailer’s technology and software engineering arm, sent out an internal memo warning against sharing confidential information with the AI ChatGPT.
Pactum AI, the company that develops the chatbot, is a cutting edge artificial intelligence technology company. Founded in 2019, it reduces operational costs for large and complex businesses by automating bargaining and procurement processes. Pactum AI has a wide range of algorithmic tools and uses a deep understanding of artificial intelligence, including natural language processing and machine learning, to create smarter and faster negotiations.
Darren Carithers, Walmart’s Senior Vice President for International Operations, identifies the success of using the chatbot. He believes that just like with self-checkout in retail stores, some customers like it while others prefer to see a human face. Carithers concludes that AI technology is taking an important place in the market and ever sector must take advantage of the benefits it brings in order to stay ahead of competition.
