You are, by now, probably familiar with the ongoing supply chain challenges brought to bear by recent global crises such as the COVID 19 pandemic and the Russian invasion of Ukraine. When the supply or flow of the supply is disrupted, management of current inventory becomes imperative. To be able to continue supporting demand and prevent out of stocks the inventory in the warehouse and the field must be optimized. Two things to consider in relation to this need are transportation strategy and field inventory utilization.

Traditionally it has taken a substantial over-stocking of the field in order to cover surgical cases in all necessary territories, while also accommodating for potentially long transit times and clogged sterile processing departments. This also gave way to a buildup of inventory in locations where it is not being optimally utilized, leading the manufacturer to produce more to cover the areas that do have strong demand for the product.

The harsh reality is, without proper inventory visibility and sales reporting, it is impossible to understand how effectively inventory is being utilized in the field. 

One strategy often employed to combat these issues is to ship on-demand, often overnight, to service surgical cases as they occur. In addition to creating the risk that the inventory won’t arrive on time or won’t be ready for the case, overnight shipping always drives up costs over time (and in many cases, very quickly). Overnight shipping costs can be as much as 3-5x higher than ground shipping. What if, instead, you knew in real time when cases are scheduled? What impact would that have on your business? 

Knowing when the inventory has to be in the providers’ hands allows you to optimize shipping to ensure it arrives on time without the need for rush-shipments just to service a case.

As mentioned above, another significant challenge eroding profitability is the ability (or inability) to optimize inventory utilization. Consigning inventory to distributors and hospitals can build the amount of inventory in the field and prevent you from being able to use it where it is actually needed. When inventory gets stuck in this way, without proper inventory visibility it is difficult to know where stagnant inventory is located and what opportunities you have to redirect it to current sales opportunities. You end up with a cycle of overproduction and over-distribution because inventory is not being utilized efficiently. 

Ultimately the key to solving these problems is knowledge.

Utilizing your data to know where your inventory is, how it is being utilized, and where it is needed allows you to build processes to shift resources when necessary to support sales or reduce inventory exposure. Unfortunately, traditional methods of surgical case and inventory management in the medical device industry have failed to deliver this level of knowledge, leaving many manufacturers ill-equipped to handle shocks to the supply chain, let alone drawn out disruptions. 

To take control of your field inventory and get the visibility you need, reach out to us and start a conversation. ConnectSx can help.