Customized distribution solutions may cost less than you think, and may provide a better solution for your organization’s supply chain needs
Would you visit a podiatrist for help with a headache? Of course not, because healthcare services are not one size fits all. When necessary, you visit the specialist you need to help solve your problem. The same is true for purchasing departments within healthcare facilities such as hospitals or physician offices— a medical supply company with a small rural hospital support model may not be the best choice for a large, urban hospital or an ambulatory surgery center.
Why settle for less?
If you have kept up with the Suture Express blog over the past couple of months, we’ve thrown a few interesting factoids at you: It’s estimated that anywhere from 10 to 30 percent of products expire on hospital shelves. A 2012 report by the National Academy of Medicine estimated that systems lose $765 billion a year due to inventory waste. And here’s a new one for you: Supply chain cost is typically the second largest expense for hospitals, after labor costs, and according to SMI, some hospitals will see supply chain costs overtake the cost of labor by 2022. Distributors can help reduce healthcare providers’ costs by offering services designed to streamline the supply chain through inventory management, activity-based pricing, consulting, and outsourcing services.
Optimizing the supply chain isn’t just important, it’s essential. A customized distribution solution tailored specifically for your hospital could cost less than an “off the shelf” solution that may not meet all of your needs, or that may offer services that you just don’t require.
With a plethora of challenges already facing supply chain executives (waste, stock-outs, lack of transparency, soaring costs), you have to ask yourself if choosing a “one size fits all” distribution solution really makes sense? For example, your OR needs to have a wide variety of sutures available. Physicians are likely have their own preferences (typically Ethicon or Covidien), and you also need to keep cost in mind—not only the cost of the product itself, but the cost of your inventory. How much do you need to keep on hand? How will you track product use and what’s still on the shelves?
It’s not just about delivering boxes
In a recent HIDA report1, a supply chain executive said, “There’s a real opportunity for distributors to expand their model by providing logistics support and consulting around distribution/services. It can’t just be about delivering boxes.”
You want a distributor that will work with you to find exactly what you need. Can they help you implement barcode tracking? Are you considering RFID? Maybe you want to optimize your inventory or implement a just-in-time supply model, but you don’t know where to start. In addition to customization, you may also want to consider a solution that’s scalable, so that it will grow with your organization. Indeed, superior distribution services are so much more than moving boxes from one location to another!
Satisfaction all around
Suture Express was founded by a group of materials managers who recognized an unmet need for next-day suture product delivery. We offer a specialized distribution model that seeks to keep supply chain executives, clinicians, and financial leaders happy.
Banner Health is a perfect example of the diversity mentioned above—it is comprised of large and small hospitals in both rural and metro settings across the western U.S. Because of its large geographic area, it made sense to create a consolidated service center (CSC) to overcome distribution challenges. Suture Express meets the needs of centralized, self-distribution supply chains by providing both low-cost bulk deliveries to the CSC and highly reliable, next-day distribution service where needed. With greater inventory control made possible through its partnership with Suture Express, Banner Health achieves supply chain savings.
Other Suture Express customers have implemented just-in-time and stockless supply models. Perhaps it’s time for you to ask, just what can my distributor do for me? To learn more about Suture Express, visit https://sutureexpress.com.
- HIDA’s Healthcare Supply Chain 2015 Strategic Insights for the Distribution Channel: http://www.hida.org/App_Themes/Member/docs/Press%20Releases/HIDA_Thought-Leaders_White-Paper.pdf