Adapting to Evolving Requirements: Agentic AI for Retail Supply Chain Operations
Authors: Lei Zheng, Liping Yang, Zihao Li, Guodong Lyu, Chaik Ming Koh, Chung-Piaw Teo
Organizations: School of Business and Management, Hong Kong University of Science and Technology · School of Management, University of Science and Technology of China · Institute of Operations Research and Analytics, National University of Singapore · NUS Business School, National University of Singapore
Abstract
Retail supply chain operations rely on coupled decision modules that must adapt as requirements evolve. LLMs offer a natural-language interface for this task, but existing methods primarily focus on individual optimization models. Extending them to heterogeneous decision pipelines is challenging because a requirement may admit multiple intervention paths with different downstream effects. We formulate requirement-driven adaptation as the joint selection of an intervention route and an admissible module-level change, and propose a graph-constrained agentic framework in which domain agents expose admissible reformulation interfaces and a central processor searches over bounded intervention paths. Candidates are validated and compared using downstream KPIs. In collaboration with a large retail partner, we evaluate 100 warehouse requirements elicited from practitioner interviews, with GPT, Qwen, and DeepSeek as base LLMs. Relative to direct LLM reformulation, our framework improves correctness and end-to-end success across all three models, raising end-to-end success from 72--76% to 79--83%.
AI agents in supply chains face a fundamental epistemic gap: large language models (LLMs) interpret policies but lack physical grounding, while reinforcement learning (RL) optimizes flows but is semantically blind to unstructured constraints. We introduce REFLECTICHAIN, bridging this gap through a Generative Supply Chain World Model (SC-WM) - encoding heterogeneous supply networks into a 6-dim graph-latent space with physical conservation - and Double-Loop Learning that separates epistemic uncertainty (KL-trust-region-bounded policy adaptation) from aleatoric uncertainty (stochastic latent rollouts). On Semi-Sim, a 10-node semiconductor benchmark with SIR risk propagation, 6 perturbation types, and 10 policy constraint templates, REFLECTICHAIN improves Rationale Consistency Score by 33.0% (p < 0.0001, d = 2.78), maintains 82.3% operability under adversarial shocks, and exhibits anti-fragile behavior (+40.2% gain under moderate pressure). We identify three operational epistemic mechanisms - uncertainty separation, knowledge-boundary detection, and empirical Bayesian policy updating - and discuss five limitation categories.
Large language model (LLM) agents have made rapid progress on short-horizon, well-scoped tasks, yet their ability to sustain coherent decisions in dynamic long-horizon environments remains uncertain. We introduce RetailBench, a data-grounded simulation benchmark for evaluating tool-using LLM agents in single-store supermarket operation. RetailBench models retail management as a partially observable decision process and is designed to support thousand-day-scale simulations. In this environment, agents must manage pricing, replenishment, supplier selection, shelf assortment, inventory aging, customer feedback, external events, and cash-flow constraints. We evaluate seven contemporary LLMs under representative agent frameworks over a 180-day evaluation horizon and compare them with a privileged oracle policy. Results show substantial variation across models: only a small subset survives the full evaluation horizon, and even the strongest LLM runs remain substantially behind the oracle policy in final net worth and sales outcomes. Behavioral analysis attributes these gaps to incomplete evidence acquisition, surface-level decision making, and the lack of a consistent long-horizon policy. RetailBench provides a controlled testbed for studying reliable autonomy in economically grounded long-horizon decision-making.
Large language model (LLM) agents have made rapid progress on short-horizon, well-scoped tasks, yet their ability to sustain coherent decisions in dynamic long-horizon environments remains uncertain. We introduce RetailBench, a data-grounded simulation benchmark for evaluating tool-using LLM agents in single-store supermarket operation. RetailBench models retail management as a partially observable decision process and is designed to support thousand-day-scale simulations. In this environment, agents must manage pricing, replenishment, supplier selection, shelf assortment, inventory aging, customer feedback, external events, and cash-flow constraints. We evaluate seven contemporary LLMs under representative agent frameworks over a 180-day evaluation horizon and compare them with a privileged oracle policy. Results show substantial variation across models: only a small subset survives the full evaluation horizon, and even the strongest LLM runs remain substantially behind the oracle policy in final net worth and sales outcomes. Behavioral analysis attributes these gaps to incomplete evidence acquisition, surface-level decision making, and the lack of a consistent long-horizon policy. RetailBench provides a controlled testbed for studying reliable autonomy in economically grounded long-horizon decision-making.