Podcast: AI, automation, supply chain, and soda machines. Grainger execs talk trends in manufacturing

Below is an excerpt from the podcast:

Sam Johnson: Up to 30% of the products that a customer will buy and put on their shelf actually never get used. [They] get lost … damaged … go obsolete. And that's a crazy amount of lost productivity and lost capital if you think about it over a large business enterprise.

Robert Schoenberger: In March, I visited the Grainger Show in Florida, along with several of my colleagues from Endeavor Business Media. And we spoke to quite a few executives within the company about how that supply chain management company is working with manufacturers these days. You just heard Sam Johnson, VP for customer solutions at Grainger, talking about some of the challenges that they help manufacturers face. And here's a little bit more from Sam.

See also: Excessive downtime? It’s your systems, not your machines

SJ: When a maintenance individual go into a storeroom, about 18% of the time, they walk away without the product that they actually went in to get.

RS: During several wide-ranging conversations, we spoke with Grainger officials about how they're dealing with the world around us these days, which of course means speaking about tariffs. Here's Barry Greenhouse, senior VP of merchandising and supplier management.

Barry Greenhouse: All our suppliers, and we are as well, are looking at other countries and where's kind of the best service cost trade-offs of where to kind of land production. I would say it's quite challenging, I would say, given that, the kind of somewhat unilateral kind of application of tariffs to multiple countries concurrently, like the ability to kind of arbitrage or remove product, there's not a lot of separation, honestly, at this point. So, folks, either us or other manufacturers or choosing to move production are primarily doing it.

I think now from a diversification risk mitigation standpoint, but from a pure cost play standpoint, the arbitrage isn't significant, I would say, right now. If I go all the way back to like the 2008, 2009 kind of recession, and then even during COVID, what held true was protect service. Get secure inventory, protect service, worry about everything else afterwards, but protect service. And that helped. But I think the disruptions now are slightly different with kind of the tariff environment.

Podcast: Siloed IT and OT, outdated wireless among top hurdles to scaling industrial AI

So, in a somewhat fortunate way, if I go all the way back to like 2017, 2018, we had looked at kind of our portfolio of products and whatnot before the tariffs, or during the first kind of round of tariffs back in that first [Trump] administration.

And we had done quite a bit of work that I think prepared us for this landscape now that we're in with tariffs. And this is probably like glass half full in many ways, but what we've seen in this instance here is like, we're not uniquely exposed for most of our products.

We definitely partner with our national brands to secure supply, but even with our own private brand portfolio, typically, we feel like we're either diversified or our exposure is coincidental with everybody else's exposure, i.e. certain products get made in certain parts of the world and centers of excellence.

And so that whole commodity is exposed, but we don't have any kind of unique specific exposure to that. And so that is something we are always trying to manage and mitigate is like, where do we, how do we mitigate kind of the downside risk first? And then how do we protect service?

Podcast: Stories of real AI adoption in manufacturing maintenance

I think is kind of the way we kind of look at it. And then and then kind of figure it out from there. I think it really depends on what the context is. Like the tariff context is so different than the COVID context, I think.

RS: And of course, no 2026 manufacturing conversation would be complete without discussing data management and AI. Here is Rick Sigler, vice president of an on-site services at Granger, talking about data management.

Rick Sigler: It starts with having really, really great bulletproof data first, and then for our customers, they're looking for a lot more visibility and transparency around data that we can provide to them that they actually can't easily get themselves. And you think about our products, right? The MRO products in many cases are not in a system. They're usually managed in expense. So, they don't have a lot of visibility around what's on the shelf, how often is it moving, who's using it.

See also: New Cisco AI study sees widening execution gap, strain on manufacturing infrastructure

And then when you, I would say the complexity comes in when you want to see that in a useful way at an enterprise level. So, think of a customer that has 100 plants and they want to see information broad, but they also want to be able to dig in deep and understand site level stuff too. That's extremely challenging for any supplier right now. I don't think anybody's doing it particularly well.

And part of it is because of the challenge of having good data, having systems that allow you to get the data and then actually do something useful with it. That's been a theme across pretty much every category, every director of category or procurement, supply chain in many cases, that is sort of top of mind for them as they try to get a little more sophisticated about indirect spend.