Casestudy

Pharma Company Identifies New Product Launches with Category Management

Author: Vice President, Marketing Strategy, SpendEdge

Overview

Today, the pharmaceutical industry players are shifting towards product innovations to compete with their counterparts in terms of stable growth, healthy margins, and retain their value in the market space. Leading pharmaceutical companies are devising the need for strategic category management solutions to increase performance and reduce costs. Also, organizations advocate for category management to identify and evaluate suppliers and prioritize actions to manage the marketing spend proactively. Furthermore, category management helps companies analyze customers’ reach and devise effective global consumer marketing strategies.

Category Management in Pharma

Category management organizes and manages procurement spending effectively across various categories, enhances supplier relationships, and maintains approved quality standards. This approach is vital for pharma companies aiming to optimize their supply chain and procurement cycles.

Pharma companies benefit from category management by implementing a structured procurement method, which helps maintain a seamless procurement cycle. This includes monitoring supplier performance, fostering solid relationships to ensure a steady flow of pharmaceuticals meeting approved quality standards, and ensuring that the right pharmaceutical products are sourced efficiently and cost-effectively.

Companies can enhance their overall procurement efficiency by focusing on supplier relationships, categorizing products, and implementing robust procurement methods.

Key Reasons to Invest Resources in Category Management

Improved Customer Experience:

Effective category management helps businesses tailor their product offerings to meet their target customers' specific needs and preferences. By organizing products in a logical and customer-centric manner, businesses can enhance the shopping experience.

Increased Sales and Revenue:

By understanding customer preferences and optimizing product assortment, pricing, and placement, businesses can encourage more significant purchases, cross-selling, and upselling opportunities.

Optimized Inventory and Supply Chain:

Category management ensures that inventory levels are aligned with customer demand. This prevents overstocking and understocking issues, which can lead to cost inefficiencies and missed sales opportunities.

Effective Promotions and Marketing:

A well-organized category structure allows businesses to plan and execute targeted promotions and marketing campaigns, leading to more effective use of promotional resources.

Data-Driven Decision Making:

Category management relies on data analysis to understand customer behavior, market trends, and product performance. This data-driven approach enables businesses to make informed product assortment, pricing, and inventory management decisions.

Success Story

The Procurement Pain Point and Insights Offered

A renowned pharmaceutical company was facing predicaments in developing effective strategic sourcing solutions. The client wanted to understand the price trends and fluctuations prevailing in the pharmaceutical space, the latest trends and opportunities, and get an accurate price forecast for the products offered.

Solutioning

To understand the latest developments in the market space, the client approached SpendEdge’s category management team. The team of experts at SpendEdge carried out extensive research, comprising interviews and discussions with leading stakeholders in the pharma industry. The team also compiled information from various proprietary sources, such as paid industry databases, company presentations, and newsletters. Considering various factors influencing the growth of the pharmaceutical industry, SpendEdge’s category management solution helped the client identify new product and service launches in the industry, giving directions to the client on the products that align with pricing objectives, seasonal trend, and consumer demand. The solution includes strategic positioning of the products to meet customer demands while optimizing sales performance. The solution further helped the client accurately forecast pricing trends and understand their potential impact on the costs of material sourcing.

With years of expertise in offering many services, SpendEdge’s category management solution aided the businesses evaluate the current state of their purchasing practice. With the help of category management, the client further streamlined their source goods and services, supplier selection, and understand internal stakeholder activities and requirements. SpendEdge’s procurement solutions also assisted the client in accurately monitoring market and supplier development and developing proactive market strategies.

Business Outcome

The category management solution helped the client focus on strategic category initiatives and ensure improved stakeholder management. The client also implemented an effective pricing strategy and better-managed category risks and supplier relationships.

Conclusion

Category management is essential in the pharmaceutical industry to ensure effective strategies in sourcing and delivering correct medicines. By employing a structured procurement method, pharma companies can streamline their procurement cycle, improve supplier performance, and optimize procurement spending. Category management allows for precise categorizing of pharmaceuticals, enhancing supply chain data analysis and supply chain risk management. This strategic approach supports the standardizing of procurement procedures and empowers category executives to drive procurement optimization. Ultimately, category management is pivotal for maintaining a resilient and efficient pharmaceutical supply chain.

Why choose SpendEdge?

Frequently asked questions

Pharmaceutical companies can mitigate category risks through strategic sourcing by diversifying their supplier base, conducting thorough supplier evaluations, and establishing strong supplier relationships. Implementing robust procurement methods and leveraging supply chain data for predictive analytics helps in anticipating disruptions and ensuring the consistent supply of critical medicines.

Regulatory compliance significantly impacts category management practices in the pharma sector by necessitating stringent quality standards and documentation. Companies must ensure that their suppliers adhere to these regulations, which influences procurement decisions and supplier selection. Compliance requirements also drive the need for meticulous tracking and reporting, impacting how pharmaceuticals are categorized, sourced, and managed throughout the supply chain.

Category management is a strategic approach to effectively managing and organizing products within specific categories based on customer preferences, market trends, and other relevant factors. It involves analyzing and optimizing various aspects of product assortment, pricing, placement, promotion, and overall strategy to drive business growth and enhance customer satisfaction.

• Strategic Procurement: Category management enhances the procurement cycle by employing structured methods, improving supplier performance, and optimizing procurement spend • Supply Chain Efficiency: By effectively categorizing pharmaceuticals and leveraging supply chain data, pharma companies can mitigate risks and ensure timely supply of correct medicines • Improved Supplier Relationships: Focusing on supplier relationships and performance allows for a steady flow of high-quality pharmaceuticals, meeting approved quality standards • Data-Driven Decisions: Utilizing supply chain data and effective strategies enables better decision-making, supporting procurement optimization and standardizing procedures across the supply chain

Pharmaceutical companies continue to invest resources in category management to optimize their product portfolios, improve supply chain efficiency, and enhance customer relationships. By grouping similar products into distinct categories, pharma firms can gain insights into spending patterns, identify cost-saving opportunities, and negotiate better supplier contracts. Category management also enables pharmaceutical organizations to standardize product quality, streamline purchasing processes, and deliver higher-quality patient care by aligning strategies with customer needs.

Talk to Our Experts

From retail to healthcare, businesses are scraping the bottom of the barrel hoping to find the next opportunity for topline growth or spending cutbacks. Contextualized category intelligence is increasingly the key differentiator.

Contact Us

Recent Posts

SpendEdge Drives End-To-End Supply Chain Transformation for an Alcoholic Beverages Business

Author: Rajesh Case Study Overview Client Industry Solution Alcoholic Beverage Manufacturing CompanyManufacturing, an...

Read More

Developing Risk Management Strategy for a Pharma Manufacturer

Being proactive, data-reliant, and efficient is the most effective way to tackle potential and current risks along th...

Read More

Providing Risk Assessment Insights to a Fast-Food Industry Player

SpendEdge emphasizes the value and importance of risk assessment and mitigation and encourages businesses to develop ...

Read More
Request for proposal
SpendEdge Central: Comprehensive procurement intelligence platform
x