Healthcare is undergoing a radical change with the advancement of technology. There is tremendous increase in preventive and curative diagnostic and treatment procedures, each requiring some or the other medical device, equipment, and/or consumables.
Therefore, it’s a priority for hospitals to stock the necessary supplies so that surgical cases are executed as and when planned without having to face the problem of unavailability of supplies.
However, it is tough for hospitals to plan for the procurement of their supplies due to an unpredictable demand and large number of Stock Keeping Units (SKUs). Hospitals, unlike other businesses, don’t have the luxury of forecasting a particular time when they will get more patients and/or patients with similar types of ailments.
Hence, hospitals have to fill their inventories with enough SKUs to cater to an erratic and fickle demand which many a times leads to inventory carrying for almost 90 days and above. In doing so, hospitals are blocking huge working capital and also often end-up seeing stock shortages, excesses, and even expiries, which leads to massive revenue leakages.
It is well-known that medical supplies comprise one-third of the expenses in a hospital’s Total Cost of Operations (TCO) and it is the second highest expenditure after salaries and labour cost. Further, according to an article by Definitive Healthcare, a prominent healthcare data publication, the cost of medical supplies will surpass labour costs and become the largest expenditure of hospitals by 2020 worldwide. Medical supplies in the form of consumables and pharmaceutical are the primary focus areas for hospitals to achieve operational efficiency.
Also read: New Healthcare Trends in 2019
At Medikabazaar, we have been supplying to over 20,000 hospitals with their monthly requirement of supplies. We realised that there were significant fluctuations in their purchases. We then did our own research to gain a better clarity. We stumbled upon a survey by Cardinal Health – a US-based Fortune 500 healthcare services company which revealed some shocking statistics.
The survey stated that around 40% of doctors are forced to cancel surgeries, and approximately 69% of them had to postpone cases due to the unavailability of vital supplies. We understood that the problem is faced by hospitals globally.
After our personal interactions with hospitals coupled with research statistics, we decided to fulfil this need. With our strong capabilities in Artificial Intelligence (AI) and Machine Learning (ML), we thought of designing a solution that will understand this erratic requirement and provide accurate stock projections to help hospitals procure the right quantity required instead of overstock or unwanted supplies.
Vizi – our AI and ML-based intelligent inventory application helps hospitals to plan their procurement by providing them with an actionable purchase list of products showing what and how much needs to be procured.
It also recommends the safety or reserve stock of SKUs to avoid stock out situations and the level of safety stock with color indicators. Hospitals don’t need to take any additional steps for data entry to use this application.
They can also source supplies at the best prices from a single-point of contact, Medikabazaar, rather than sourcing the same from various suppliers, a task which can be daunting and often unrewarding.
Medikabazaar offers best prices due to economies of scale, delivery at their doorstep from our fulfillment centres across India, and thus helping them to slowly move to just-in-time inventory for fast moving SKUs. As hospitals will procure the right quantity at the most competitive prices, they will save approximately 30% in OpEx of medical supplies.