The common use of AI for trivial tasks is a distraction. The real opportunity for businesses is to apply AI to core operational workflows, dramatically increasing output per employee. This creates a window for massive margin expansion before market prices adjust.

While flashy AI tools for design and content creation garner attention, their ROI can be negative. The most significant efficiency gains will come from automating mundane, repetitive tasks in areas like supply chain logistics, where AI can solve complex coordination problems that truly move the needle.

The most valuable entry point for AI in retail isn't complex ad optimization, but solving operational problems like shelf restocking. By connecting point-of-sale, loyalty, and ERP data for inventory management, retailers build the foundational data infrastructure necessary for more advanced, AI-driven advertising and sales lift prediction.

The idea that AI will replace jobs assumes companies operate at 100% efficiency. In reality, its first impact is cleaning up messy data and preventing simple but costly errors, like advertising out-of-stock products, thereby increasing overall business sophistication.

For TeamShares' portfolio of durable, "evergreen" small businesses, the primary impact of AI isn't a threat to their core revenue. Instead, AI is a massive efficiency lever in the back office, reducing tasks like audit-related bank reconciliations from a six-week process to mere minutes, dramatically cutting operational overhead.

Businesses are unlikely to use powerful AI simply to shave a few percentage points off their software spend. The real, high-impact ROI comes from applying AI to improve core business operations, making the actual business more effective and efficient.

Amazon's massive but under-appreciated investment in robotics (2.5x more industrial robots than the rest of the US combined) is poised to unlock unprecedented operational efficiency and margin growth in its core retail business, shifting the profit driver beyond AWS and ads.

AI will fragment the customer journey across countless platforms, moving purchases away from brand-owned websites. Retailers must build systems to manage inventory and product information across this decentralized landscape, not just focus on perfecting their own site experience.

While public attention focuses on glamorous AI applications like image generation, the most transformative and valuable contributions of AI are happening in less visible areas. Optimizing logistics, streamlining back-office operations, and improving industrial processes are where AI is quietly delivering significant ROI.