BEFORE A logistics organisation can determine whether an AI initiative will save money, it needs to understand what the existing process costs, what the AI solution will require to implement and operate, and how those costs will change as usage scales across sites, lanes and customers.

That discipline is increasingly important as logistics organisations move from experimenting with AI to putting it into operational workflows, from load planning and carrier management to warehouse execution and freight audit. A solution can work technically and still fail to deliver the expected financial return if the business case did not account for the full cost of implementation, ongoing operation, support, data preparation and scaling.

The more defensible concern is that logistics organisations can enter an AI initiative without a sufficiently detailed understanding of what the solution will cost relative to the process it is intended to improve.

That gap is important because the cost of an AI initiative extends beyond whatever appears on a vendor’s quote. Data preparation, technical architecture, integration with TMS, WMS and carrier systems, implementation, monitoring, training, workflow changes and ongoing management can all affect the economics of a solution. If those factors are not included in the original business case, a technically successful pilot at one facility or on one lane may look very different once it becomes an operational system across the network.

For logistics organisations, the larger challenge may be even more fundamental: many AI initiatives are not being evaluated through a consistent business case or measurement framework. According to newly released supply chain AI research1, 78% of supply chain leaders say their organisations are pursuing AI without a formal plan, and 85% said AI opportunities are selected without consistent criteria or a formal evaluation process. The research also found that developing or validating the business case was the most frequently identified barrier to AI progress, cited by 64% of respondents. Perhaps most telling, only 11% of organisations establish a baseline and measurable success criteria before launching an AI initiative, and just 3% go back afterward to compare results against the original business case.

Those findings point to a problem that comes before vendor selection: organisations often lack the measurement discipline needed to determine whether an AI investment is delivering what it promised. If a logistics team does not define what success looks like before it starts an initiative, it has no benchmark against which to catch a cost overrun after the contract is signed. A pilot can succeed technically, automating a task a human previously performed, and still fail economically once the full cost of implementing and operating the solution is measured against the value of the work it was meant to support. That does not necessarily mean the AI solution was overpriced. It may mean the original comparison did not capture the full economics of either option.

None of this means logistics leaders should avoid AI. It means the buying process needs a step that is currently missing from most organisations: a true cost model built before a contract is signed, not after.

The model

That model should start with the fully loaded cost of the human process being replaced or augmented, such as a transportation planner, freight auditor or customer service rep, including wages, benefits, training and management time, expressed as a cost per hour of output. But the comparison should not stop there. Buyers should also document the volume, cycle time, error rate and other performance measures associated with the existing process, such as on-time performance, billing accuracy or exception handling time, so they are comparing the AI solution against a meaningful baseline.

It should then build a range, not a single number, for the AI alternative, based on realistic usage volume, including peak-season surges, and the full lifecycle of the initiative rather than a proof-of-concept scenario. Buyers should ask vendors directly how pricing scales with volume, what implementation and integration costs are expected, what internal resources will be required, how ongoing support and monitoring are handled, and whether there is a cap or a way to throttle usage before costs exceed the assumptions in the business case.

The key question is not simply, “What does the AI tool cost?” It is, “What will it cost us to put this capability into production across our network and keep it producing measurable value?”

The survey

The survey data1 points to where organisations should focus first. Respondents identified execution related needs, not AI capability itself, as their greatest gaps: preparing data and technical architecture ranked highest at 63%, followed by planning and managing implementation at 60%, measuring outcomes and expanding what works at 52%, and evaluating technology and vendors at 49%. That combination is revealing. Organisations are asking for help with the practical work required to make AI function in live logistics operations, while the research also shows that relatively few organisations have established the measurement practices needed to determine whether those investments are working.

The organisations that will benefit most from AI in logistics will not be the ones that adopt the fastest. They will be the ones that treat every AI investment the way they would treat any other capital decision, such as a new warehouse system or fleet purchase, with a baseline, a forecast range, and a defined point at which results get checked against what was promised. That discipline, more than any specific tool, is what turns AI from a hopeful bet into a measurable one.

Rachelle Butler, director of Redwood Advisory, Redwood Logistics

1: Survey – JBF Consulting Finds Organizations Are Pursuing AI Without the Strategy to Deliver Measurable Results; September 2026