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Successful M&A Strategies for Companies in the Aerospace and Defense Industry

As pressures and shifting demands in the aerospace and defense industry continue to mount, companies find it difficult to survive. Cost pressures, regulatory controls, and engineering changes further add to the woes. Companies looking to curb their mounting debt are getting out of the commercial aviation business and planning to sell their remaining stake in the coming time.

On the other hand, larger companies aiming to gain additional revenues, access new technologies and seize opportunities for growth and scale may target smaller companies that are unable to keep pace with increasing financial pressures. However, M&A activities come with their own set of challenges. Companies are compelled to incorporate organizations that come with their systems, processes, and cultures. Here are the key points to remember for your M&A activity.

Companies must perform the aerospace and defense industry analysis to address financial pressures during a merger. Request a free proposal to financial services industry analysis and gain customized market intelligence solutions. 

Strategies to Adopt During M&A Activity in the Aerospace and Defense Industry 

Integrate the data 

Companies in the aerospace and defense industry adopt M&A strategy to drive growth, expand the company and take advantage of additional development opportunities. However, to leverage such opportunities and see the payoff, companies must integrate the data acquired for the new company at the earliest. They must use a supply chain planning platform to pull data from numerous sources, including ERP systems. The platform must be able to model the planning behavior of the disparate systems for the success of M&A activity.is one of the most important metrics for companies to evaluate due to the

Wondering how companies can gain actionable insights to develop effective strategies to address aerospace and defense industry challenges? Get in touch with our experts for more insights on our solutions.

Streamline and standardize processes

Many companies have siloed functions and a host of Excel spreadsheets for data analysis. IT functions strive to integrate between modules and the company’s separate ERP systems. There is always a challenge of merging demand, supply, and inventory for reporting and scenario management.

Companies need to model all planning behavior and streamline and standardize processes to make vital information available to supply chain planning teams. Streamlining processes not just minimizes the time to plan but facilitates an easier transition for parties involved in the M&A activity.

Incapability to standardize processes can increase complexities for different functions and impact aerospace and defense industry market share. Stay a step ahead by requesting free platform access from our procurement experts to gain detailed market insights.   

Drive adoption of new and expanded processes

Businesses need to have a comprehensive understanding of risks, integration issues, tax implications, new assets and inventories pre- and post- M&A. They require a high level of trust to ease cultural differences, expand processes and embrace change. Quickly integrating data and streamlining processes on a single platform facilitates companies to document and access workflows easily. It simplifies sharing and learning new processes. Also, it helps companies to establish a level of trust among existing and new stakeholders as everyone is looking at the same plan.

To gain detailed insights into the aerospace and defense industry trends, request more information from our analysts.

Best Ways to Evaluate Suppliers in the Global Active Pharmaceutical Ingredients Market amid COVID-19 Outbreak

The growth of the active pharmaceuticals market is mainly driven by the expansion of the oncology pharmaceutical sector and continuous investment in technologies and the manufacturing capacity. There are significant developments in both developed and developing economies, where the pharmaceuticals infrastructure is improving all the time.

But the outbreak of COVID-19 is expected to impact the active pharmaceutical ingredients market. A large number of manufacturers of active pharmaceutical ingredients are located within Chinese provinces that were epicenters for the virus outbreak. They are responsible for the production of some vital drugs, apart from other active pharmaceuticals ingredients.

Moreover, the landscape is highly fragmented due to the involvement of a wide range of industry players. The different approaches used by different companies to develop active pharmaceutical ingredients make it difficult for companies to evaluate their sourcing process and suppliers.

Want to tackle challenges posed by the Pandemic? Request a free proposal and our experts we will get back to you in 48 hours with customized solutions.

Ways to Evaluate Suppliers in a Dynamic Active Pharmaceuticals Ingredients Market 

In-house vs outsourcing 

It is one of the most important metrics for companies to evaluate due to the ongoing global crisis. Outsourcing manufacturing can significantly reduce the cost for pharmaceutical companies but can dramatically increase lead times for production. However, in-house involves major resource investment, risks, and increases product complexities. Large contract manufacturing organizations (CMOs) can operate at metric ton scale capacity and offer the highest production volumes but can lack diversity. There are higher chances that smaller CMOs will scale up their production. While selecting a CMO, companies must ensure that the providers can deliver specific pharmaceutical ingredients at the correct scale.

Are you looking for suppliers in established manufacturing hubs such as the US and Germany? Contact us to identify the CMOs with a proven track record of successful commercial production in the active pharmaceutical ingredients market.

Identify innovators

Seeing the current market situation, pharmaceutical companies should extensively focus on CMOs that are actively developing innovative active pharmaceutical ingredients and improving production methods and technologies within their domain. The right CMOs will focus on controls to prevent cross-contamination and protect workers, invest in improving active pharmaceutical ingredients composition, prioritize high-quality processing, and select manufacturing methods that reduce lead time and bring down costs.

We understand that finding such CMOs is an arduous task and requires accurate market intelligence. Stay a step ahead by requesting a free demo of our procurement platform to gain exclusive insights to identify providers with the strongest innovation record.

Lowering production scales 

Producing active pharmaceutical ingredients at a kilo scale can make more sense in today’s time for CMOs and outsourcing pharmaceutical companies alike. Focusing on small-scale production can help CMOs to prevent contamination as small batches are less likely to be contaminated. Creating high potency active pharmaceutical ingredients can be a solution for companies as they are significantly stronger and produced in smaller quantities. MT-scale production is a high investment risk and can put millions of dollars at risk if the batch fails. Smaller-scale CMOs can prove to be effective for pharmaceutical companies in such a crisis to reduce lead times and minimize costs.

To partner with CMOs that specialize in the global active pharmaceutical ingredients market, request more information from our analysts.

Reducing the Risk of Supply Chain Disruptions in the Wake of COVID-19 Outbreak

The COVID-19 outbreak is having a distressful impact on the global economy and there are several procurement and supply chain challenges that businesses need to overcome quickly. Our procurement intelligence team is currently working with leading global procurement organizations across industries to support them in dealing with its consequences on the supply chain such as travel restrictions in certain geographies, logistics constraints, labor shortages, supply shortages, etc. We are offering customized solutions to help enterprises address supply chain risks and protect their supply chains from serious and costly disruptions. Our experts have also listed some key areas for managing supply chain disruptions.  

Want to better manage supply chain disruptions? Request a free proposal and our experts we will get back to you in 48 hours with customized solutions.

Key Areas for Managing Supply Chain Disruptions

Develop strategies to address global supply chain disruptions

In order to manage global supply chain disruptions, organizations must develop a comprehensive risk management strategy. Factors impacting the dynamics of international supply chains leading to increased uncertainty in logistics operations at the tactical, operational, and strategic levels must be analyzed to implement risk mitigation tactics. Risks associated with supply chains at a country level should be identified to understand the impact of COVID-19 on supply chains.

Ensure compliance with local laws

Companies having global supply chains need to deal with the uncertainty in local laws and cultural norms that may impact a business. The physical transport of materials and finished goods has come at a risk, increasing complexities and uncertainties. Understanding the current scenario and norms that impact supply chain operations, uncertainty in supplier reliability and lead times can help companies prepare effective action plans to mitigate supply chain disruption occurring due to pandemic.

Wondering how companies in different regions minimizing the impact of COVID-19 outbreak? Contact us, to gain comprehensive insights. 

Categorize supply chain disruption strategies

Disruption of complex materials or components widely impacts supply chain operations. A comprehensive analysis of the supply chain is a must for assessing risks associated with holistic sources. Qualitative and quantitative analysis of supply chain risk is also critical for companies to maintain their speed to market. 

Understanding different types of supply chain disruptions is crucial for companies to devise effective strategies. Stay a step ahead by requesting a free demo of our procurement platform to gain exclusive insights into risks.

How can SpendEdge Help you Manage Supply Chain Disruptions?

We can assist you with customized procurement intelligence solutions to help you gain deep-dive insights on topics such as:

Ongoing Credible Updates on the current situation and developments – COVID-19
Mitigation measures for overall country-specific supply chain operations
Travel restrictions at a country level – Identification of Ports of Entry/Exit that are affected/vulnerable
Government policies (import/export bans) and implications at a country level
Second/dual/alternate sourcing options to mitigate supply chain risks
Quick audit of second source supply chain
Predictive models to assess country/region wide scale of impact
Long-term assurance of supply consulting for direct materials
Tracking commodity price movements and shortages
Enterprise-level Business Continuity Roadmap Consulting

To know more about recent supply chain disruptions and the steps to mitigate them, request more information from our analysts.

Has the CoronaVirus Pandemic Called for a Re-course of Your Business Perspective? –Quick Insights into Risk Mitigation Measures Imperative at This Moment

An easy answer to the downward sliding business performance is the coronavirus pandemic that is resulting in the shutdown of some of the major economies. While a cure for this declining business health is underway, the need of the hour is a major evolution of our business perspective. It will not be entirely wrong to say that more than focusing on reviving the profit margin, it is crucial to implement risk mitigation measures. Such risk mitigation measures will be instrumental to help stakeholders brace for any sudden economic shock or to seal any open wounds in their business.

Imminent Risks That will Inhibit Enterprises to Design Business Contingency Plans

Supply Chain Inconsistency- Buyers from industries such as automobile, pharmaceutical, chemical sectors are heavily reliant on the consistent supply of products and service delivery. However, with some of the major regions under lockdown, the distribution capacities of suppliers are getting severely hampered. This is creating a serious supply deficit for buyers in these industrial sectors who are left without any back-up to maintain their production schedule. This imminent challenge is making it imperative for these sectors to explore risk mitigation measures to stay immune from such sudden supply shocks.

Subscribe to our procurement platform and be the first to get updates on the risk mitigation measures buyers from these industries are adopting to sustain in this troubling time.

Breach of supply contract- Absence of definitive clauses in contracts will allow a section of suppliers to take the liberty to resort to actions that are clear breaches of contracts. For instance, the absence of a risk mitigation clause such as a price lockdown in a supply contract will enable suppliers to set prices of their products on their own terms. They will tend to state the current situation as an excuse for a sudden price hike. Considering this possibility, the inclusion of binding clauses that will ensure that suppliers stay compliant to the contract is one of the most imminent risk mitigation measures in this troubling time.

Get instant insights into the risk mitigation measures most of the industries are following to stay immune to risks in terms of supply contract breach. Get your free sample of SpendEdge’s procurement intelligence report on the contract compliance services market.

Uncertainty in the recovery of market demand– Quite in contrary to the recession in 2008 that was triggered by economic policy failures, this perceived economic recession owing to a viral outbreak makes it difficult to anticipate the recovery of the market demand. What is more dangerous is the lack of foresight of enterprises that are also troubled with liquidity shortages. Desperate to stay relevant in the current market, such enterprises fail to assess from a long-term perspective and attempt to either liquefy their assets or pump in more investments without gauging the possibility of ROIs. This reinstates the importance of risk mitigation measures required to survive in this economy.

Why take business risks in these troubled times? Download the free sample of SpendEdge’s procurement intelligence report on corporate strategy consulting services and get insights into expert-recommended risk mitigation measures to re-evaluate your business perspective.

Risk Mitigation Measures that are the Needs of This Hour

Collaboration with risk-mitigation advisors- Apart from the economic impact of the recent pandemic, buyers from the BFSI sector, in particular, are often challenged with the absence of effective data management, inefficient organization-wide risk modeling framework. These factors make it crucial for them to leverage credit risk mitigation measures to address the potential risks faced in this sector. As a matter of fact, the adoption of risk mitigation services in MEA is anticipated to grow due to the collaboration among governments and big corporates to reduce the economic impact caused due to the outbreak of diseases, especially caused by viruses such as MERS-CoV and Ebola in Africa and the Middle East.

Download the free sample of SpendEdge’s procurement intelligence report on the risk management services market to know about the leading risk mitigation service providers and how can they add value to your business.

Engage with risk mitigation service providers who provide risk-scoring of suppliers- Risk scoring is an algorithm used to evaluate a vendor and rank them on a scale of 1 to 1,000 where a higher number denotes higher risk. It is advised that buyers partner with risk mitigation service providers who use risk scoring methodology as they can easily quantify threats and deficiencies associated with suppliers.

Resort to stress-testing measures- Engagement with risk mitigation service providers who offer regular stress testing will help buyers to ensure the appropriate use of capital assessment. Moreover, extreme stress testing such as reverse stress testing will aid buyers to resolve emerging threats to future business plans and strategies.

No matter what, time is money in business and it is ticking. Access to SpendEdge’s procurement platform is free and instant. Now, get daily insights into the best risk mitigation and negotiation strategies with the best suppliers for a wide range of business sectors.

Analyzing the Role of Strategic Sourcing in the Financial Services Industry

Financial Services Industry Overview 

Businesses across the financial services industry are seeking ways to manage costs in the way that they do not creep back into the system. External spend is one such category of spend that constitutes approximately 30 percent of its cost base. To this end, companies are improving the strategic sourcing approach – an approach successfully used in different sectors.   

Strategic sourcing envisions innovative ways to optimize the long-term value contribution from suppliers and procurement functions while inculcating traditional techniques. When implemented effectively, strategic sourcing can deliver sustained incremental savings of total external spend, with better saving opportunities in individual spend categories.

Companies in the financial services industry can achieve sustained cost savings through strategic sourcing. Request a free proposal to financial services industry analysis and gain customized market intelligence solutions. 

Role of Strategic Sourcing in the Financial Services Industry 

Better cost savings 

The financial services industry has witnessed a strong and benign credit environment growth over the last few years. However, economic pressure is forcing businesses to take cost management initiatives. The reason being – companies do not address the underlying cost drivers. The “shell game” that firms play ostensibly cut spending ends up being detrimental in the medium- to long-term, as these costs inevitably reappear over time. Although short-term reduction of external costs is demanded each year and should be delivered but companies must take proactive approach in identifying how they can cut costs in a more sustained way. Having a top-down approach can help organizations reap the benefits of sourcing functions within the firm.

Wondering how companies operating in the financial services industry can devise cost management strategies? Get in touch with our experts for more insights on our solutions.

Seizing opportunities 

Our experience with the clients indicates that organizations can achieve substantial savings even across expense categories that are already considered “managed”. There exist significant reductions in opportunities in the areas that traditionally do not fall under the procurement management umbrella. It includes spend categories such as legal expenses and temporary staffing, as well as sourcing of functions such as payments, mortgage servicing, and loan processing. However, capturing such savings is an arduous task. It requires a radical remake of the procurement function, developing a comprehensive, center-led set of competencies and capabilities.

The incapability to capture savings for the future can impact the market position of companies. Stay a step ahead by requesting free platform access from our procurement experts to gain detailed market insights.   

Maximizing strategic sourcing potential

Taking a series of pragmatic steps can help companies to realize the benefits of strategic sourcing. A comprehensive overview of the external spend categories and spend drivers rather than simply analyzing traditional procurement categories and relating them to an appropriate level of procurement sophistication can help companies unlock significant cost savings. Also, mapping out a comprehensive strategy to gain more value from suppliers and effectively managing spend drivers can help achieve a sustained lower spend base.  

To gain detailed insights into the factors impacting the financial services industry growth rate and the role of strategic sourcing, request more information from our analysts.

Strategies to Minimize the Impact of Coronavirus on Supply Chains

Manufacturers across the globe are struggling to address supply chain disruptions caused due to COVID-19 outbreak. Commonly called as coronavirus, is impacting supply chains in terms of parts, labor, and government restrictions. Quarantined workers and shortages of components have crimped the availability of goods from different manufacturing locations, primarily China. The severity of disruptions is expected to increase after the first quarter of this year. Lead times have doubled, and that shortage is compounded by the shortage of air and ocean freight options to move products for the majority of US businesses due to coronavirus impact on supply chains. The experts at SpendEdge have put forth some key points after evaluating the coronavirus impact on supply chains. Here they are:

1. Companies in the manufacturing sector could expect a delay of approximately three weeks for the supply of raw materials and products.

2. There could be disruptions in the supply chain of hardware required to run the business or third-party systems.

3. As the situation is expected to remain fluid due to lockdown in several regions, shipping and delivery could become a new choke point for some industries.

4. Not just Facebook and Apple products, the shutting down of global supply chains could lead to scarcity of other day-to-day essentials as suppliers face their own challenges in improving supply chain management operations.  

 

Want to understand coronavirus impact on supply chains? Request a free proposal and our experts we will get back to you in 48 hours with customized solutions.

How Can Companies Prepare for the Future? 

Advanced manufacturing units 

Companies of today must focus on advanced manufacturing and things such as 3D printing and artificial intelligence rather than setting massive factories that build things at large scale and at low labor costs. Instead of making one city a manufacturing hub, the focus should be on smaller manufacturing hubs in different cities. Shortened supply chains will reduce coronavirus impact on supply chains and improve capability and innovation.

Wondering how companies in different categories are improving supply chain management and reducing coronavirus impact on supply chains? Contact us, to gain comprehensive insights.  

Localized supply chains

If companies want to prepare themselves for the future, they need to create small and agile supply chains. They cannot afford to have a 30-day shipping time from China to the United States. Supply chains need to be nimble, not just to address unprecedented risks or pandemics but for innovation. It is really difficult for companies to be innovative onshore when they have advanced manufacturing engineering offshore.

Creating localized supply chains is crucial for companies to address unprecedented risks. Stay a step ahead by requesting a free demo of our procurement platform to gain exclusive insights into coronavirus impact on supply chains and devise effective strategies.  

In-house logistics 

Companies should consider investing in a self-operated, proprietary supply chain and logistics network and create an internal task force to manage the crisis response. Deploying human and autonomous capacity to facilitate the delivery of crucial supplies and waiving fees for some suppliers could help companies resume their operations quickly. In devastating epidemic situations like this, improving in-house logistics networks could lead to greater profitability for companies.

To know more about coronavirus impact on supply chains and ways to improve logistics and supply chain management strategies, request more information from our analysts.

3 Key Procurement KPI Metrics that Companies Must Be Aware Of

While cost savings remain the end objective of procurement functions, companies are not just restricted to that. They track the right procurement KPI metrics to measure the performance of their procurement process. Evaluating the right procurement KPI metrics enables companies to optimize and regulate spend, quality, time, and cost. But how do companies know that the procurement KPIs that they are tracking matter the most? By gaining a comprehensive understanding of the procurement KPIs used by leading companies. Here’s the key procurement KPI metrics that companies must be aware of. 

Want to know how top companies are measuring the efficiency of the procurement process? Request a free proposal and our experts we will get back to you in 48 hours with customized solutions. 

Key Procurement KPI Metrics 

Procurement KPI metrics #1: Quality

Quality is one of the key procurement KPI metrics that companies should take into consideration for sustainability. The key factors to include are: 

Supplier quality: Gaining actionable insights into the suppliers’ performance is critical for companies. Measuring supplier defect rates can help companies evaluate a supplier’s individual quality and examine its trustworthiness.

Purchase order accuracy: Inaccuracies in purchase orders can augment operating costs for businesses. Such procurement KPI metrics would help businesses ensure if the supplies ordered were according to demand and delivered at the right time.

Compliance issues: Compliance with regulator norms in the respective supply markets is imperative to ensure legal security. Dip in compliance rate can spike up maverick spend and increase the chances of getting penalized.

Wondering how our expertise can help you create the procurement KPI template by providing necessary insights? Contact us now! 

Procurement KPI metrics #2: Delivery 

Unplanned orders: Any unplanned order acquired to prevent the shortage of products or services is termed as an emergency purchase. The lower number of emergency purchases reflects the efficiency of the procurement function.

Supplier efficiency: The efficiency of suppliers can be better measured in terms of lead time. Supplier lead times is one of the important procurement KPI metrics that businesses must calculate without fail. It starts with availability confirmation and ordering and ends with the delivery of goods.

PO cycle time: The purchase order cycle covers the end-to-end ordering process. It is crucial for companies to count the cycle times from the time purchase requisition is submitted.

Improving delivery time is crucial for companies to boost brand value. Stay a step ahead by requesting a free demo of our procurement platform to gain exclusive insights into procurement KPIs evaluated by leading organizations. 

Procurement KPI metrics #3: Cost savings 

Invoice cost: Cost per invoice varies greatly from organization to organization. Having an automated process can significantly reduce the processing cost when compared to manual approaches.

ROI: It is an important key metrics for companies to determine profitability. It helps analyze the cost-effectiveness of their procurement investment.

Spend management: For companies to optimize cost and forecast expenses, it is critical to improving spend under management. It is the percentage of procurement spend that is controlled by the management.

To know more about procurement KPI scorecard and metrics, request more information from our analysts.



Into the Future of Pharma Supply Chain: Trends Driving the Pharma Industry

Companies in the pharma industry usually have complex supply chains that are underutilized and inefficient. They are ill-equipped to cope with the sort of products that are coming down the pipeline. Many of the medicines produced require different manufacturing and distribution techniques. As a result, companies have started redesigning their supply chains. But most of the changes introduced have been short-term measures to address immediate challenges such as the rationalization of larger manufacturing networks as a result of acquisitions. Let’s discuss the key factors dictating the need for a new approach to the pharma supply chain to help companies better plan for the changes.

Want to know how you can address pharma’s future needs while improving the pharma supply chain? Request a free proposal and our experts we will get back to you in 48 hours with pharma supply chain management best practices. 

Factors Impacting the Pharma Supply Chain 

New drugs and devices 

Pharma supply chain is changing drastically in recent times. Bioengineered vaccines and biologics are expected to form a major part of the market. Such drugs will require companies to develop more complex manufacturing and distribution processes in order to prevent impurities in the production process and damage during shipping. In fact, some personalized medicines and poly-pills will need to be individually extracted, propagated, prepared, treated and finished near the patient location. Also, the majority of specialist treatments will require novel delivery devices which are more complex than the ones being used today.

Conditional approvals 

As new methods for assessing, approving and monitoring medicines emerge, the launch process for medicines is also expected to become more incremental. The binary system of either approving or rejecting a medicine will be more graduated. The US Food and Drug Administration (FDA) has also already introduced conditional approvals for certain drugs. Now, it is emphasizing on post-market surveillance and “live licenses” to confirm the efficacy of medicines. Companies that are making investments on the pharma supply chain to meet peak volumes will now need an agile supply chain that can respond to license alters.

Live licenses can minimize upfront investments but will require supply chains that can be rapidly adjusted? Contact us, to know more about strategies to improve the pharma supply chain management process. 

Demand-driven supply chains

Many countries have been constantly trying to reduce dependency on hospitals. Patients are encouraged to take a proactive approach in managing their healthcare. These trends will be on the rise as clinical advances will provide better medicines to patients for acute conditions. This will require companies to build demand-driven pharma supply chain to assemble healthcare packages for different patients at ‘super hubs’ before delivering to patients’ homes.

The inability to build a demand-driven pharma supply chain can make it difficult for companies to ensure their presence in the market. Stay a step ahead by requesting a free demo of our procurement platform to gain exclusive insights to develop effective pharma supply chain management strategies. 

Emerging economies

With the growing importance of developing economies, many medical device companies have already started designing products suitable for these markets. Pharma supply chain companies must learn from such companies and understand the needs of patients living in developing countries to tailor their offering accordingly. Also, they should focus on building supply chains that are geographically dispersed and more secure.

To know more about the latest pharma supply chain trends and strategies to improve the process, request more information from our analysts.

Additive Manufacturing

How Can Additive Manufacturing Drive Supply Chain Transformation

Every supply chain has one or the other weak link. It might lead to quality-control issues or delays in the delivery of products. With the help of additive manufacturing companies can forge some alternatives to improve product lines and production approaches. They can break existing performance tradeoff by reducing the capital required to achieve economies of scale and increase flexibility. Changing the capital-versus-scale relationship can improve the production process and impact how companies configure the supply chain. Additive manufacturing can redesign the supply chain by reducing material waste, increasing production flexibility, and decentralizing production. Companies aiming to improve their existing supply chain performance by making incremental changes must develop a longer-term strategic plan for AM deployment.

Looking to transform your supply chain? Request a free proposal to know your competitors’ supply chain strategies and gain customized market intelligence solutions. 

Role of Additive Manufacturing in the Supply Chain

Minimize material inputs 

In traditional processes, the level of material input required for production is dependent on the product’s design complexity. With additive manufacturing technology, manufacturers can produce higher-performing designs that are not possible through traditional manufacturing techniques. Additive manufacturing minimizes design complexity and material need, thereby facilitating companies to work towards leaner manufacturing and improve design quality.

In addition, additive manufacturing-based designs can integrate complex geometries into traditional product designs, significantly reducing both weight and the amount of material required to create a specific product or part.

Wondering how top companies operating in the manufacturing sector are moving towards lean manufacturing?

Reach to our experts for more insights    

Alter the production process 

The use of additive manufacturing allows manufacturers to simplify their production processes and reduce the complexity of supply chains by cutting down the number of assembly steps that a product undergoes to reach its final form. The technology provides designers the ability to redesign parts to reap the benefits of part and sub-assembly consolidation. This can lead to major supply chain transformation, involving a reduction in labor inputs, a number of tooling and machining centers, and work in process inventory.

Employing additive manufacturing can further alter the production process by reducing the amount of tooling required to manufacture parts.

Provide a contingency plan 

Manufacturing companies don’t need to choose between additive manufacturing and conventional manufacturing techniques. The two can coexist, providing manufacturers with a contingency means of production if the primary means of production is incapacitated. The use of additive manufacturing can reduce supply chain risk and support uninterrupted deliveries to customers. It can be used in the backup capacity.

Moreover, additive manufacturing production systems are flexible and configurable, allowing companies to produce different parts without incurring additional costs. But manufacturers should consider running a trial of AM-produced trial products to ensure that their functionality matches to those of conventionally produced parts. 

Worried about supply chain risks? Not anymore! Stay a step ahead by requesting free platform access from our procurement experts to know how leading companies are using additive manufacturing to reduce supply chain risks.   

Improve supply chain process flexibility

Supply chains need to be flexible enough to react to changing requirements. The use of additive manufacturing can impact the supply chain flexibility in two primary ways. First, it can reduce the time and resources required to design and develop a new product. The compression in product development lead time can help companies to react rapidly to changing market preferences. Second, it can reduce the time and resources required to switch product designs. This can shorten lead times and enables companies to personalize end products on a mass scale on customer demand.

To gain detailed insights into how additive manufacturing is impacting the supply chain transformation process for manufacturers, request more information from our analysts

Pharmaceutical Industry

Is the Global Pharmaceutical Industry Held Hostage by the Deadly Coronavirus? SpendEdge’s Tridib Bora Offers Insightful Answers to this Imposing Query

The pharmaceutical industry has not been in the pink of its economic health since the outbreak of the novel coronavirus. Supply chain disruptions, soaring prices of bulk drug raw materials, and indefinite shutdown of one of the biggest drug manufacturing hubs are some of the potential symptoms of this perceived failing health of the global pharmaceutical… Click To Tweet Most of the leading drug-makers across the globe are staggering to close the gap in their supply chains and are exploring the option to manufacture the raw materials within their geography. Against this backdrop, SpendEdge’s Tridib Bora offers a holistic analysis of the current pharmaceutical industry, the possible risks faced, and the best practices from a procurement point of view that every stakeholder must consider in the current state of the health sector.

Among the key geographies, who do you think will be the worst hit owing to the uncertainties in the pharmaceutical industry caused by the coronavirus outbreak?

Tridib: It is too early to issue this predicament. However, I will take the liberty to say that for countries where the pharmaceutical industry serves to be one of the highest revenue-generating sectors, the impact will be more prominent. Regular phases of drug development drive the demand growth in the pharmaceutical industry. However, to do so, drug manufacturers from certain geographies are highly dependent on the low-cost imports of raw materials. To optimize the manufacturing cost and to harness the potential of the skilled workforce in low-cost countries, most of the developed nations tend to outsource the manufacturing functions to APAC countries such as China and India. The recent turn of events has put a lid on the manufacturing process as well as the supply of the drug intermediates and APIs in China. This is resulting in immense supply chain complexities which will exert a negative impact on the pharmaceutical industries in developed nations like North America and Europe.

Get real-time insights into the price trends that are impacting the global pharmaceutical industry. Request free access to our platform to access SpendEdge’s recent procurement intelligence reports that enlist the procurement best practices to address the challenge of the rising purchase price.

Get real-time insights into the price trends that are impacting the global pharmaceutical industry.

Will this impact on the pharmaceutical industries across the leading economies hurt the growth prospects of the global pharmaceutical industry?

Tridib: Not entirely. Complexity does not necessarily cull the prospects of growth in any sector. There is no denying the fact that the outbreak of coronavirus will herald procurement and category management complexities in the pharmaceutical industry but it will not block the funnel of investments in this industry. With the number of contaminations increasing, the drug makers are on a war footing to develop an antidote to treat coronavirus. This will lead to steady demand growth for clinical research and pharmaceutical drug development service providers. Government authorities across regions are holding meetings to counter the impact of the supply shortage of drug intermediates and APIs from China. Countries in Europe are resorting to stockpiling drug raw materials in bulk to avert a sudden supply shortage. These factors will continue to drive procurement in the pharmaceutical industry. Sales of wearable medical devices such as face masks are skyrocketing with days in areas that are vulnerable to the outbreak of coronavirus. Medical tests are becoming an essential part of the daily regimen for individuals travelling across geographies which is driving demand in the lab consumables market. It is safe to say that despite the procurement complexities, it will take more for the growth prospects in the pharmaceutical industry to hit the dire straits.

Get your complimentary sample procurement intelligence reports on the global pharmaceutical industry that offer actionable insights into spend analysis and price forecasts across the major geographies.

What are the procurement best practices you suggest to deal with the perceived complexities in the pharmaceutical industry against the backdrop of the outbreak of coronavirus?

Tridib: One of the immediate complexities that I see will trouble the players in the pharmaceutical industry is a disruptive supply chain. Ineffective sourcing will worsen its impact on the growth prospects. However, while sourcing from countries like China that are the manufacturing hubs for bulk drug raw materials, it is imperative for buyers to involve the suppliers in their inventory planning. It is a recommended procurement best practice for buyers to seek suppliers’ assistance in demand forecasting to decide the quantity to be pre-ordered and preserved which will play an important role in addressing supply shortage as well as control storage costs.

Procuring in this global pharmaceutical industry will not be a cakewalk. Request more information from SpendEdge’s experts that state real-time insights into the sourcing strategies and procurement best practices will help buyers devise sustainable and futuristic procurement strategies befitting the pharmaceutical industry dynamics.

Get state real-time insights into the sourcing strategies that will help to devise sustainable and futuristic procurement strategies befitting the pharmaceutical industry dynamics

Bulk drug raw materials procured from countries that have experienced the outbreak of coronavirus have high chances of contamination. To detect the same at an early stage, it is imperative for buyers to incorporate GDP throughout the supply chain. This enables traceability and assurance in the quality of products.

It is worthwhile to mention that SpendEdge’s recently done procurement intelligence reports on a range of products and services in the pharmaceutical sector have identified the main procurement pain points and other risk factors faced in the global pharmaceutical industry and enlisted the procurement best practices to be adopted in this industry.

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