Thought Leadership: Smarter Systems, Stronger Stores
Artificial intelligence is moving rapidly from experimentation to practical applications, with the potential to change how hardware retailers manage inventory, train employees and make everyday business decisions. For retailers already juggling staffing challenges, complex assortments and demanding customers, the opportunity lies in putting existing business data to work and eliminating time-consuming tasks.
Arturo Buzzalino, chief product and innovation officer at Epicor, believes the next major development in retail technology will be the shift from software that records transactions to systems that recommend actions. He also sees AI as a way to strengthen the product knowledge and personal service that distinguish independent hardware stores.
In this exclusive conversation with Hardware Connection, Buzzalino discusses how retailers can prepare their operations for AI, where the technology can deliver measurable value and why human expertise remains central to making better business decisions.
Hardware Connection: How are retailers’ attitudes toward artificial intelligence changing, and what opportunities do you see for hardware stores?
Buzzalino: People are much better prepared to talk about AI because they’ve experienced it, whether in their personal lives or at work. The speed of acceptance has been remarkable. Cloud technology took many years to gain traction, while AI has become part of the conversation much more quickly. One of the things that has informed my strategy for building AI is pragmatism. Retailers don’t have the luxury of conducting endless experiments or employing entire teams of data scientists. Technology has to solve specific problems that generate value. That might mean making sure products are on the shelf, preventing out-of-stocks or helping customers find what they’re looking for. It might mean making sure employees have the knowledge to answer questions and help customers.
Those challenges have always existed. What’s interesting is that AI can help solve them in ways that weren’t possible five or six years ago. The introduction of large language models and reasoning models also changes how people interact with software. Now you can talk to it. I think that’s a major shift, similar to the introduction of touchscreens and tablets.
You’ve talked about moving ERP software from a “system of record” to a “system of action.” What does that mean for hardware retailers?
Traditionally, an ERP system has been about recording information—transactions, inventory, customer data and business processes. That information is essential, but the opportunity with AI is to do something more with it. We can start identifying patterns, making recommendations and helping people take action. Rather than simply showing you what happened, the system can suggest what you should consider doing next.
For example, it might recognize that a particular type of customer typically buys certain products and suggest additional items that could be relevant. That’s where we start getting into prescriptive applications of AI. The system might offer three possible actions, and the person can decide which one makes the most sense. The goal is to give people better information and help them make better decisions.
Many hardware retailers still operate with a mixture of legacy systems, spreadsheets and separate software platforms. What’s the biggest obstacle to moving toward an AI-enabled operation?
A lot of businesses have information spread across disconnected systems. They might be managing some things in spreadsheets and other things in older software. When you implement an ERP system, it forces you to audit your processes. You have to figure out how to bring your data into the system in a consistent, repeatable way. That isn’t AI, but it creates the foundation for AI. The system of record is what allows you to build a system of action. Once you have reliable information about your operations, you can begin adding AI agents that help people act on that information. Getting your processes and data organized is one of the most important things you can do to prepare.
Inventory turns, in-stock positions and profitability remain fundamental performance measures for hardware retailers. How can AI help improve those results?
Those metrics sound simple, but any one of them might be influenced by hundreds of variables throughout a retailer’s operation. One of the biggest opportunities is removing repetitive tasks that consume employees’ time. You might have an associate spending 30 minutes every day on a particular process. If technology can eliminate that work, multiply those 30 minutes across all your associates, every week and every year. The savings can become significant. More importantly, you’re freeing up people to spend time on creative and strategic activities that can improve the business. You’re removing the mundane, repetitive work that creates friction. I sometimes think of AI as adding WD-40 to the operation. It helps everything flow a little better.
Hardware stores and lumberyards serve very different customers, from DIYers to professional contractors. How can AI help retailers better understand those customers?
One of the things AI can do is identify patterns that people might not otherwise recognize. Different types of customers have different purchasing behaviors. AI can look at those patterns and provide insights that are relevant to the customer you’re serving.
For example, it might recognize that a particular customer typically buys certain products and suggest other items the retailer should consider offering. I think we’ll see more of these prescriptive applications, where technology identifies an opportunity and recommends a course of action. Rather than simply generating reports, the system can say, “Here are three things you might consider doing.” The person still makes the decision, but now that decision is informed by information that might have been difficult to uncover otherwise.
You’ve used the phrase “amplification of human expertise.” How could AI strengthen the kind of personal service that independent hardware stores are known for?
Think about someone who is new to a job and still learning. Having an intelligent system they can talk to, ask questions of and receive suggestions from can accelerate their training. But it also applies to experienced employees. We’re always learning, and even someone who has been in the business for years will encounter something they don’t know. Having access to that information at your fingertips makes employees more knowledgeable and better equipped to help customers. In some ways, it’s similar to what internet search did for us. Suddenly, you could find information that previously might have been difficult to access. Now you can interact with an intelligent system using natural language and get the information you need to take action. That’s how AI can empower people. It gives employees access to knowledge that helps them do their jobs better.
5 Ways Retailers Can Put AI to Work
1. Start with one problem. Identify a specific task or operational challenge that AI could help solve, such as answering routine questions, reducing repetitive work or improving access to product information. Resist the temptation to tackle everything at once.
2. Get your data in order. Before expecting AI to deliver useful insights, examine how your business collects and manages information. Disconnected systems, spreadsheets and inconsistent processes make it harder to put that information to work.
3. Test before expanding. Try an AI application in one store, with a few employees or within a single workflow. Evaluate what works, make adjustments and expand only when the results justify it.
4. Look for measurable time savings. A task that consumes 30 minutes of an employee’s day can represent substantial labor hours when multiplied across an entire staff. Focus on repetitive activities that technology could handle more efficiently.
5. Use AI to support employees. Give associates tools that help them find information, learn faster and answer customer questions. The goal is to strengthen the personal service that brings customers into independent hardware stores.
