Health & Pharmaceuticals

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Warehouse Operations Review

Our client, an international manufacturer and distributor of pharmaceutical and medical products, supplies the Australian and New Zealand markets with approximately 700 products sourced from their factories in Europe and the USA. In order to support their growth plans, the client engaged GRA to review their current warehouse operations in order to understand whether they were capable of supporting their business for the next 3 years and beyond. Solutions were proposed to improve operational workflows and productivity (reducing labour costs by 17.5%), handle products more effectively and extend the life of the current facility to the medium-term.

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Sales & Operations Planning (S&OP) Design 4

Our client is a New Zealand-based natural health company which produces, sells and distributes its range of natural health and natural skincare products globally. The organisation had been undertaking significant business transformation and wished to improve the process by which they made decisions in order to better balance supply with demand, integrate strategic and operational plans and align the business. GRA was engaged to design a Sales and Operation Planning process that would build on the organisation's existing planning capability in order to meet these needs. A comprehensive solution was developed for the client which allowed them to establish an effective S&OP process.

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Supply Chain Review 5

Our client, an international business with interests in health care, nutrition and high-tech materials, incurred operational issues following a significant change in its sales channel strategy. Whilst the new sales channel was partly successful it also lead to large costs, high inventory levels and a sales team that was underperforming. In order to identify solutions GRA conducted a short, sharp business assessment. Our analysis delivered three key findings around inventory holdings, policy targets, and process and system configurations. We addressed these factors by reconfiguring the system, providing appropriate education & training, and resolving the S&OP process integration issues. These actions delivered significant reduction in inventory and operating costs.

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Supply Chain Network Optimisation 5

A supply chain review of our client, a consumer good manufacturer and distributor, showed opportunities to reduce distribution and inventory costs without degrading current service levels, as well as potential improvements in manufacturing planning by using an optimal production lot size, and adequate stocking policies. GRA conducted a supply chain network optimisation project identifying possible distribution cost reductions of up to $1.1m pa; 18% reduction in finished goods inventory and a $1.1m saving on externally supplied packaging materials.

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Supply Chain Strategy and Capability Review

Our client is a wholesaler of premium pet foods, health care products and accessories with international and domestic suppliers and a national customer base. They faced many supply chain challenges, including changing customer dynamics, margin pressures, exploration of different distribution models and business capability growing slower than sales. GRA undertook a review of the industry and the client's position and delivered an outline of tactical, operational and strategic opportunities, a clear view of their capabilities and a capability road-map, and a risk mitigation strategy. 

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Forecasting & Replenishment, Inventory Optimisation

As a wholesaler and distributor of ethical and over-the-counter (OTC) pharmacy products in a fiercely competitive and low margin environment, our client identified the need to optimise its inventories and enhance its demand planning process with a view to freeing up cash and improving working capital performance, improving inventory turns, DIFOT and planning process efficiency. GRA’s broad analysis delivered a 26% inventory reduction, service level increase to 97%+, significant turn rate improvement and forecast accuracy improvement as well as a much more efficient planning process.

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Supply Chain Review 2

Our client, Indonesia’s leading healthcare distribution company, supplies pharmaceutical and ethical products, medical products and over the counter products to 12,000 pharmaceutical outlets, 1,900 hospitals as well as over 20,000 modern trade nationwide. GRA was commissioned to perform a scoping study to identify the potential opportunities available as a prelude to more detailed analysis. The assessment indicated that considerable savings were realisable through inventory optimisation, however existing contractual requirements prevented them from being realised. Additionally, the DC structure and footprint was potentially inappropriate for the current network – shifting volumes to their secondary DC would provide cost savings in the order of 11%.

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Supply Chain Network Optimisation 3

Our client commissioned a review of their current maintenance, storage and distribution network and future support requirements to identify opportunities to reduce whole of life support costs, increase network capacity, improve customer service delivery and inform infrastructure requirements. Through analysis of support plans, service agreements and contracts within and between business units and the broader industry community, we determined that changing from a linear network to a multi-echelon network identified a potential reduction in Time to Make Serviceable of 55% whilst removing repetition of maintenance effort reduced Repair Time per repair of 21% for Medium Grade Repair and 12% for Heavy Grade Repair.

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Testimonials

"The team at GRA have helped to both identify and quantify the areas where we should apply focus to deliver better landed costs for our members."

– Steven Johnston, CEO, ProVision Eyecare Pty Ltd

Typical results

  • 20-40% inventory investment reduction
  • increased service levels ranging up to 99.9%
  • 10%-15% reduction in supply chain operating costs
  • 5%-20% spend management savings
  • the ability to fund business initiatives from operating cash flow (OCF) improvements
  • improved return on capital employed (ROCE)
  • a minimum 3:1 ROI (10:1 to 30:1 typical)