Contract2Plan: Verified Contract-Grounded Retrieval-Augmented Optimization for BOM-Aware Procurement and Multi-Echelon Inventory Planning

TL;DR

Contract2Plan is a verified AI-to-optimizer pipeline that ensures compliance and feasibility in procurement and inventory planning by integrating contract clause extraction, constraint compilation, and solver-based verification, reducing risks of infeasible plans.

Contribution

It introduces a novel pipeline combining LLM-based clause extraction with solver verification, formalizes repair guarantees, and demonstrates improved feasibility in contract-grounded planning.

Findings

Extraction-only planning shows high violation rates.

Verification reduces infeasible plans and violations.

Synthetic benchmark highlights importance of verification.

Abstract

Procurement and inventory planning is governed not only by demand forecasts and bills of materials (BOMs), but also by operational terms in contracts and supplier documents (e.g., MOQs, lead times, price tiers, allocation caps, substitution approvals). LLM-based extraction can speed up structuring these terms, but extraction-only or LLM-only decision pipelines are brittle: missed clauses, unit errors, and unresolved conflicts can yield infeasible plans or silent contract violations, amplified by BOM coupling. We introduce Contract2Plan, a verified GenAI-to-optimizer pipeline that inserts a solver-based compliance gate before plans are emitted. The system retrieves clause evidence with provenance, extracts a typed constraint schema with evidence spans, compiles constraints into a BOM-aware MILP, and verifies grounding, eligibility, consistency, and feasibility using solver diagnostics, triggering targeted repair or abstention when automation is unsafe. We formalize which clause classes admit conservative repair with contract-safe feasibility guarantees and which require human confirmation. A self-contained synthetic micro-benchmark (500 instances; T=5) computed by exact enumeration under an execution model with MOQ uplift and emergency purchases shows heavy-tailed regret and nontrivial MOQ-violation incidence for extraction-only planning, motivating verification as a first-class component of contract-grounded planning systems.