Now more than ever, healthcare companies must find new ways to cut costs and increase effectiveness. Supply chain management is the second largest and fastest growing expense for healthcare providers, with labor costs being number one, and many agree it can be improved to save money while remaining efficient. The healthcare supply chain is becoming increasingly complex with numerous moving parts, paired with cost pressures and other industry risks. Hospitals and healthcare companies are expanding their product selection to meet market demands and lengthen product life cycles.
Supply chain management can help improve the healthcare industry in a number of ways; including creating complete visibility of all products, devices, and supplies while also implementing higher levels of technology to streamline processes and track inventory. Many companies have numerous legacy systems in place that contribute to performing the above tasks. Though these tasks are simple and the data easy to gather, the use of multiple systems is time-consuming and prone to error and inefficient data being collected. It is estimated that healthcare companies lose billions of dollars annually as a result of waste, inefficiency, and lack of visibility. The best option is for these companies to outsource their supply chain to professionals, such as a third-party logistics (3PL) company to reduce costs and compete with the constant change in the healthcare industry.
Third-party logistics providers can mitigate all of these concerns and provide further exceptional services being that they are experts in supply chain management. 3PL’s have the experience and technological capabilities to manage logistics operations for multiple clients at one time. Most 3PL’s have an in-house inventory management solution providing visibility of all products at any time during the fulfillment process. These internal systems also automate all manual processes, including purchase orders and invoices which helps eliminate any manual errors leading to higher costs. The technological capabilities provided by a 3PL can also be utilized for capturing data and turning it into information on supply levels and use enabling providers to have better control on how much product is needed and when. This helps decrease any product that could be lost, expired, or wasted, which translates to money being lost that most companies cannot afford to lose.
Healthcare companies that embrace new technologies and improve their supply chain strategies by forming partnerships with 3PL’s are more likely to capitalize on new growth opportunities in the healthcare industry. It is important for them to be able to trust their 3PL provider as a knowledgeable partner and resource so that they can focus on their needs outside of the supply chain.
As fulfillment experts, TAGG Logistics focuses on a completely technology-driven approach for the most efficient fulfillment possible. The healthcare industry is the largest and fastest growing part of our business and we strive to improve our technology and operating procedures on a daily basis. Please give us a call at 1-866-991-TAGG to learn more, or fill out our contact form.