Healthcare firms worried about supply chain cost control

16 September 2008
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17 September 2008 | Paul Snell

Controlling costs in the supply chain is the main concern for companies in the healthcare sector.

According to a survey of 300 firms in the sector, carried out by researcher Harris Interactive and UPS, 60 per cent rated managing costs, particularly relating to the increasing cost of recalled and returned products, as the most important issue their firm has to deal with.

Increasing the speed of products to market was the second most important, at 42 per cent, and greater flexibility came third, at 39 per cent. Other priorities included better visibility and stronger security.

Of the firms surveyed, 60 per cent planned to increase supply chain spending in the next 18 months, with 31 per cent keeping it the same and only 7 per cent reporting there will be a decline. Of those firms with revenues of more than $1 billion (£561 million), 42 per cent intended to increase spending.

The study also found that 46 per cent of large firms plan to increase the amount of supply chain work they outsource in the next two years and the same percentage will increase work with third-party logistics providers.


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