The CPG Giant Looks to Enhance Cold Chain Logistics and Improve Final-Mile Visibility
Unilever is expanding its use of artificial intelligence across its ice cream supply chain, but significant hurdles remain in optimizing the final mile of delivery. Speaking at Manifest 2025, Sandeep Desai, EVP and chief product supply chain officer for Unilever’s ice cream division, emphasized the company’s ambition to integrate AI from suppliers to consumers.
The company already employs AI to forecast demand based on weather patterns, reduce waste, and manage real-time inventory in freezer cabinets. AI-driven efficiencies in production have also allowed for more streamlined manufacturing. However, Desai acknowledged that integrating AI into the last mile of delivery remains a persistent challenge.
Tracking Ice Cream in Transit Presents Cost Barriers
One of the most significant hurdles Unilever faces is real-time tracking of its ice cream shipments from distribution centers to retail freezers. Desai explained that while connected sensors capable of relaying location and condition data to the cloud exist, the cost of deploying such technology at scale is still prohibitive for a margin-sensitive product like ice cream.
“If we were transporting diamonds, it’s cheap, the technology is available, it’s there. We can do it,” Desai said. “When you’re transporting ice cream, where every mom and pop believes they can make ice cream too, it’s quite a margin-sensitive game, and so the cost of the technology is what needs to come down.”
Another challenge is the complexity of fleet management. Unlike ocean freight, which has seen major advancements in tracking and visibility, trucking remains highly fragmented. With a mix of large carriers and small owner-operators moving Unilever’s ice cream, achieving seamless real-time monitoring remains a work in progress.
A report from PwC on cold chain logistics highlights this gap, stating, “Real-time visibility in temperature-sensitive supply chains remains a major hurdle due to cost constraints, inconsistent adoption of IoT, and fragmented transportation networks.” Unilever’s struggles reflect broader industry-wide challenges in modernizing logistics for perishable goods.
Automation and Long-Term Supply Chain Innovation
Despite these obstacles, Desai underscored the importance of continuous experimentation with new technologies. While costs are currently high, early adoption and pilot programs can drive future efficiencies. He pointed to Unilever’s success in scaling AI-powered demand forecasting as an example of how costs decrease over time.
“We’ve got to have faith in that process. We can’t give up on piloting. We can’t give up on scaling. And I think the key is partnerships,” Desai said. “You really need to find the right partner that also sees a longer-term vision. It’s not a short-term game. It’s about the long term.”
One of Unilever’s key long-term priorities is increasing automation across its cold chain logistics network. Highly automated “dark” warehouses—facilities that operate with minimal human intervention, using drones and robotics for stock management—are becoming a larger focus. With cold storage recruitment proving difficult, automation is seen as a long-term solution to labor challenges.
Currently, 10% of Unilever’s ice cream warehouses operate as dark warehouses, with plans to increase that percentage significantly. “My vision is all warehouses should be 100% dark,” Desai said, signaling Unilever’s commitment to a more automated future.
Unilever’s Ice Cream Supply Chain Enters a Critical Transformation Phase
Unilever’s ice cream division is set to spin off as a standalone business by the end of 2024. The move is expected to drive supply chain efficiencies, with the segment already reporting 3.7% sales growth this year, fueled by operational improvements and product innovation. As it transitions into a new phase, the division’s ability to integrate emerging technologies, scale automation, and overcome last-mile tracking challenges will define its long-term supply chain success.
