Proximity in action: Elevating the industries and communities we serve
With the advent of Agentic AI and other high-tech tools, distributors have a golden opportunity to transform every industry–if they choose to take the leap.
Stop reading. Before you go any further, read this excellent article by Substack author Alex Moazed on B2B Distribution Technology. It’s about the transition from SaaS to Agentic AI, the impact on workflow tools like Salesforce and Workday, and the future of ERP in distribution. Ponder every paragraph. Click on all the links. Read it repeatedly, from the back to the front and the front to the back. Understand its ideas and explanations, and consider what they mean for your business, distribution, and the supply chain. Then, read what follows here.
Tools for tomorrow
The rise of Agentic AI in distribution may spark a massive technology gold rush, drawing in established software providers and investor-funded startups. But as Moazed points out in his closing remarks, investors and innovators need a wake-up call before they can realize profits:
We’re still early in this journey. We’ve talked to a lot of Agentic AI startups focused on B2B solutions—none of them know what B2B distribution is. And, even after we explain it to them—they usually have other verticals or higher priority ICP’s [Ideal Customer Profile] that they are focused on. Their loss, in my opinion. At $8 trillion in size, B2B distribution is plenty big to create a billion-dollar AI/SaaS business.
But I see something far more profound than potential profits for tech companies: newfound freedom for distributors. My hypothesis? Traditional software tools don’t empower distributors—they hold them back. Why? Because most providers maximize revenue by building minimal and safe solutions, selling the least functionality to the largest number of customers. While advanced features or customizations are available, upgrades come at a steep cost to distributors. And there’s always the looming risk that additions won’t be supported in future updates, leaving distributors stuck with outdated systems.
But wait, there’s more! Adopting Agentic AI could empower distributors to build their own software, creating unique solutions tailored to their specific needs and, more powerfully, their aspirations. A hamster wheel mindset hampers distributors, making them run hard but get nowhere. Not really. They buy technology to access data, direct work, and stay competitive but can only imagine returns on their investments as small, incremental improvements to historical margins. It’s a trap of low expectations. Caution stifles breakthrough ideas, keeping distributors focused on maintaining the status quo rather than exploring the transformative potential that technology, like Agentic AI, can offer.
Propelled by Agentic AI, distributors might build tomorrow tools—software to level up distributor business models, one step at a time, on a self-directed journey leading toward a brighter vision for the future of the supply chain. In this way, the $8 trillion distribution industry is not a tech industry profit bonanza but a self-innovating force for positive change, powering our economy and helping to create the society we all want to live in.
Distributors will find their own way—that’s the point of Agentic AI—but I suggest three levels of progress, each building on the previous one:
Become a more capable intermediary. In an episode of Stanford’s Future of Everything podcast, I learned that automation often diminishes worker skills. A better path is to actively develop new skills, particularly those that allow the organization to expand its capabilities. For distributors, this means stocking new products and, most crucially, offering new services.
Reinvent localness. Distributors can set the standard for human-centered automation by redefining what it means to be a local business in the digital age. One way to do this is by focusing on customers as communities, not just market segments. The new local isn’t just about serving a community’s collective product needs but rather about creating value that supports the community’s unique goals—whether that’s fostering economic growth, sustainability, or improved services.
Build proximate solutions. As Rob Wolcott, co-author of Proximity, often explains, the real breakthrough of AI and digital technologies is their ability to create new business models that bring value—whether through products, services, or experiences—closer to the moment of actual demand in both time and place. Proximity isn’t just a supply chain upgrade; it points to the future of distribution: new capabilities to provide customers and communities with precisely what they need, when and where they need it. For the supply chain, proximity means creating radical new value and embracing a hyper-local future that strengthens both businesses and communities. (Read here for more.)
The promise of Agentic AI isn’t just about better software. It’s about freedom to break out of the hamster wheel, push past the status quo, and build something truly transformative. Distributors now have the chance to lead a new era, not just for their benefit, but to elevate the industries and communities they serve.
About the artwork
This edition’s image is my photograph, captured on my iPhone, processed with Adobe’s Lightroom, and stylized for a romantic flourish by ChatGPT. Is it art? Probably not—although I’m open to compliments. The scene moved me to write this piece, and I hope my image moves you at least a little bit.
A way forward
I’m on vacation, visiting family on Maryland’s Eastern Shore along the beautiful Chesapeake Bay. The area is full of life. I’ve encountered bald eagles, herons, osprey, a fox, several deer, marmots, crabs, oysters—and a garden.
Our hosts maintain the garden with the help of another resident. It exists to provide fresh vegetables on demand throughout the growing season. Because our hosts travel frequently, this partnership is essential, with shared responsibilities for watering, weeding, and protecting the garden from bugs, birds, and varmints. The resident’s help isn’t free—it’s a paid service. And it got me thinking: What if this idea could grow with the help of a distributor, applying the principles explained in this article?
Imagine a community-scale business enabling local agriculture through compensated workers, data-driven insights, artificial intelligence, and digital connection. Nearly every home could have a garden, tended in collaboration with skilled workers who understand the local climate and community preferences, and designed with an artist’s aesthetic. Collectively, these gardens would form an interconnected ecosystem, feeding the community with both nutrition and beauty.
Homeowners and gardeners would document everything—tracking hydration, weather data, yields, nutritional content, freshness, and taste. They could sell excess produce to local farm-to-table restaurants, and chefs’ needs would influence crop selection. A sustainable energy grid could power these efforts, with surplus energy stored in batteries and sold back to the local utility for profit. Data collected from the gardens, homeowners, and chefs could be analyzed using Agentic AI to optimize outcomes continuously.
This vision is a work in process and it isn’t entirely new—it’s a form of distributed agriculture inspired by various sources, including a podcast I recently discovered. It’s a powerful example of proximity in action: moving from industrial-scale farming to hyper-local backyard gardens, harvested just in time for meals, creating a shared experience across an entire community.
Can distributors lead a movement toward proximate gardens? Absolutely. Can they lead the proximity revolution across every industry? If they choose to. After all, change is only a mind shift away.
As always, please leave your ideas, suggestions, and questions below as comments, or reach me at mark.dancer@n4bi.com.