diff --git a/services/auth/app/api/onboarding_progress.py b/services/auth/app/api/onboarding_progress.py
index 2acb2446..dfcd905f 100644
--- a/services/auth/app/api/onboarding_progress.py
+++ b/services/auth/app/api/onboarding_progress.py
@@ -45,23 +45,21 @@ ONBOARDING_STEPS = [
 
     # Phase 1: Discovery
     "bakery-type-selection",        # Choose bakery type: production/retail/mixed
-    "data-source-choice",           # Choose setup method: AI-assisted or manual
 
     # Phase 2: Core Setup
     "setup",                        # Basic bakery setup and tenant creation
 
-    # Phase 2a: AI-Assisted Path
+    # Phase 2a: AI-Assisted Path (ONLY PATH - manual path removed)
     "smart-inventory-setup",        # Sales data upload and AI analysis
     "product-categorization",       # Categorize products as ingredients vs finished products
     "initial-stock-entry",          # Capture initial stock levels
 
-    # Phase 2b: Manual Setup Path
+    # Phase 2b: Suppliers (shared by all paths)
     "suppliers-setup",              # Suppliers configuration
-    "inventory-setup",              # Manual inventory configuration
+
+    # Phase 3: Advanced Configuration (all optional)
     "recipes-setup",                # Production recipes (conditional: production/mixed bakery)
     "production-processes",         # Finishing processes (conditional: retail/mixed bakery)
-
-    # Phase 3: Advanced Configuration
     "quality-setup",                # Quality standards and templates
     "team-setup",                   # Team members and permissions
 
@@ -75,28 +73,27 @@ ONBOARDING_STEPS = [
 # Steps not listed here have no dependencies (can be completed anytime after user_registered)
 STEP_DEPENDENCIES = {
     # Discovery phase
-    "data-source-choice": ["user_registered", "bakery-type-selection"],
+    "bakery-type-selection": ["user_registered"],
 
-    # Core setup
-    "setup": ["user_registered", "data-source-choice"],
+    # Core setup - no longer depends on data-source-choice (removed)
+    "setup": ["user_registered", "bakery-type-selection"],
 
-    # AI-Assisted path dependencies
+    # AI-Assisted path dependencies (ONLY path now)
     "smart-inventory-setup": ["user_registered", "setup"],
     "product-categorization": ["user_registered", "setup", "smart-inventory-setup"],
     "initial-stock-entry": ["user_registered", "setup", "smart-inventory-setup", "product-categorization"],
 
-    # Manual path dependencies
-    "suppliers-setup": ["user_registered", "setup"],
-    "inventory-setup": ["user_registered", "setup"],
+    # Suppliers (after AI inventory setup)
+    "suppliers-setup": ["user_registered", "setup", "smart-inventory-setup"],
+
+    # Advanced configuration (optional, minimal dependencies)
     "recipes-setup": ["user_registered", "setup"],
     "production-processes": ["user_registered", "setup"],
-
-    # Advanced configuration
     "quality-setup": ["user_registered", "setup"],
     "team-setup": ["user_registered", "setup"],
 
-    # ML Training - requires either AI path or manual inventory
-    "ml-training": ["user_registered", "setup"],  # Flexible: can work with either path
+    # ML Training - requires AI path completion
+    "ml-training": ["user_registered", "setup", "smart-inventory-setup"],
 
     # Review and completion
     "setup-review": ["user_registered", "setup"],
@@ -280,14 +277,11 @@ class OnboardingService:
         
         # SPECIAL VALIDATION FOR ML TRAINING STEP
         if step_name == "ml-training":
-            # ML training can work with either AI-assisted path or manual inventory path
-            # Check if user has data through either path
-
+            # ML training requires AI-assisted path completion (only path available now)
             ai_path_complete = user_progress_data.get("smart-inventory-setup", {}).get("completed", False)
-            manual_path_complete = user_progress_data.get("inventory-setup", {}).get("completed", False)
 
             if ai_path_complete:
-                # AI path: validate sales data was imported
+                # Validate sales data was imported
                 smart_inventory_data = user_progress_data.get("smart-inventory-setup", {}).get("data", {})
                 sales_import_result = smart_inventory_data.get("salesImportResult", {})
                 has_sales_data_imported = (
@@ -300,13 +294,8 @@ class OnboardingService:
                     logger.info(f"ML training allowed for user {user_id}: AI path with sales data")
                     return True
 
-            if manual_path_complete:
-                # Manual path: just check if inventory setup was completed
-                logger.info(f"ML training allowed for user {user_id}: Manual inventory path")
-                return True
-
-            # Neither path is complete
-            logger.warning(f"ML training blocked for user {user_id}: No inventory data (AI or manual)")
+            # AI path not complete or no sales data
+            logger.warning(f"ML training blocked for user {user_id}: No inventory data from AI path")
             return False
         
         return True