How Streamline optimized inventory management for pharmaceutical retail chain

About the company

Safopharm is a well-known pharmacy retail chain that specializes in the sale of medications in the vibrant market of Uzbekistan. With a robust presence in the region, Safopharm currently manages seven strategically located outlets in the country, all seamlessly coordinated through their ERP and Streamline supply chain management system. This forward-thinking approach enables them to efficiently handle an impressive inventory of over 30,000 SKUs, ensuring a wide variety of pharmaceutical products are readily available to meet the diverse healthcare needs of their customers. Safopharm’s commitment to excellence and their extensive network have solidified their position as one of the leading and trusted pharmaceutical retail chains in Uzbekistan, serving as a vital resource for the health and well-being of the local community.

Challenge

Safopharm, as a pharmaceutical retail chain, faces daunting challenges in inventory management, primarily overstocks and stockouts. Overstocks tie up capital and risk expiration, while stockouts lead to customer dissatisfaction and lost sales. Balancing inventory is complex due to diverse medications with varying demands and shelf lives.

Project

During the implementation project, Safopharm followed a meticulous process to integrate Streamline into their operations. This included establishing a database connection using ODBC with their 1C ERP system, enabling seamless data sharing and synchronization.

Since the solution’s implementation, Safopharm has witnessed significant improvements in their inventory management practices. They successfully implemented safety stock settings for their products, employing a sophisticated ABC categorization strategy that prioritizes safety stock for high-demand items while minimizing it for lower-priority C-category products.

Furthermore, the activation of transfer orders, which allows for efficient product transfers between their various locations, has proven instrumental in optimizing their inventory and reducing order cycle times.

For items with limited sales frequency, Streamline recommends decreasing safety stock to zero, eliminating unnecessary inventory costs. Ultimately, for C-category items readily available on hand, there is no need for safety stock, streamlining operations and enhancing overall efficiency.

Outcomes

• The implementation of Streamline into Safopharm pharmaceutical retail chain operations has yielded remarkable results. The company streamlined ordering process, saving valuable time by simply following Streamline’s well-informed suggestions.
• The system provides a comprehensive overview of Stock Keeping Units (SKUs), including essential insights such as ABC analysis and safety stock recommendations. This has been especially beneficial in efficiently managing safety stock for slower-moving items.
• As a testament to the success of this partnership are substantial improvements in inventory management. Over the past few months, Safopharm managed to reduce the overstocks by an impressive $86,000, a clear indication of the positive impact this service has had on the operations and bottom line.

“Streamline has been a game-changer for our pharmaceutical retail chain. With their intuitive solution, we’ve simplified our ordering process and gained valuable insights like ABC analysis and safety stock recommendations. The results speak for themselves: we’ve reduced overstocks by an impressive $86,000 in just a few months. I am very happy with the technical support provided by Streamline. Their expertise has truly revolutionized our operations and positively impacted our bottom line,”- said Doniyor Usmanov, CEO of Safopharm.

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Further Reading:

• How to deal with supply chain processes during the Coronavirus outbreak
• Why switch from Excel to inventory planning software
• Must-read: Smart Supply Chain Management solutions for business processes optimization
• Cross-Functional Alignment in Supply Chain Planning: A Case Study of Sales and Operations Planning [PDF]
• Demand & Supply Management: Collaborative Planning, Forecasting & Replenishment