A smooth-flowing supply chain is the lifeblood of any successful business, and few industries depend more on an uninterrupted supply chain than the health care industry, where preventing disruption can literally be a matter of life and death. But despite that importance, studies show the health care industry is losing billions on supply chain inefficiencies: According to Navigant’s 2019 Supply Chain Analysis, hospitals are spending $25.7 billion more a year than necessary on supply chain.
That’s why more and more hospital companies are beginning to focus their attention on opportunities to reduce unnecessary expenses and implement better supply chain management solutions, looking to third-party logistics (3PL) partners for expert help.
“No single medical center can have every conceivable piece of equipment on-hand. First, they wouldn’t be able to afford the expense, and secondly, they wouldn’t have the physical space to store it. That’s where the right logistics partner can add value by knowing where to source the equipment and then get it to the hospital at the time needed,” said Andrew Lockwood, Senior Manager, Solutions Design of Suddath’s logistics business.
Leveraging the Capabilities of a 3PL
The right third-party logistics partnership can help minimize supply chain management costs. 3PLs have the needed systems and resources to free up hospitals, outpatient clinics, doctors’ offices and manufacturers so they can focus on their core business: improved outcomes for patients.
Consider, for example, a local hospital that is suddenly called on to perform a major reconstructive surgery or deal with a particularly severe trauma situation. Hospitals can’t reasonably be expected to have every piece of specialized equipment on site, so for these rare cases, they have to quickly bring in the right equipment. A 3PL can provide regulated warehousing to store this type of life-saving equipment properly and apply its expertise in specialized transportation to provide the hospital with the essential equipment at the right time.
3PLs also often bring specialized talent and skills that enable them to deliver added services such as on-site distribution support, customized labeling, kitting, tech support and specialized transportation for high-value capital goods.
A real value to medical providers is how 3PLs can create a customized plan for time- or project-specific needs, eliminating waste and unnecessary spending and permitting health care professionals to stay focused on patient care. In addition, medical device manufacturers that supply hospitals and the health care industry as a whole can often benefit from a 3PL capable of providing on-site manufacturing support.
Engaging Technology
Technology needs are constantly growing in the health care industry and knowing where inventory is and tracking it during the product life cycle is vital. When there is a need for out-of-the-box thinking, the right 3PL can not only manage inventory but can also provide relevant insights from available data, enhancing decision-making to better deal with product placement, turnover and obsolescence.
“Minimizing supply chain disruption is critical. Suddath currently operates a dedicated on-site warehouse and two off-site warehouses for a global medical manufacturer and processes approximately 85 tons of materials per month. With Suddath’s support, the labeling operation has increased multipacks per month by 114% in two years,” said Lockwood

By: Brad Liddie, Senior Vice President of Global Logistics Operations at Suddath