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US Healthcare Industry

SpendEdge’s Tridib Bora on Whether Investing in the Current US Healthcare Industry is Equivalent to Wading in Troubled Waters

A lion’s share of the self-containment in the US economy can be attributed to the thriving healthcare industry in the region. Featuring in the list of the top five best-performing industries, the US healthcare industry is currently witnessing a steady increase in consumer spend and is well on its way towards eclipsing some of the major industries in terms of spend growth. However, this growth is not bereft of obstacles and will pose numerous challenges for any potential investors.

In this article, SpendEdge’s procurement specialist Tridib Bora, refutes the impossibility of investment in the current scenario and shares his eloquent perspective on the current US healthcare industry.

In the near future, what do you think are the areas in the US Healthcare Industry that might experience a downward sliding growth curve?

Tridib: Considering the current market scenario, the ongoing tug-of-war between superpowers China and the US will have a rippling effect on the healthcare industry. To be more specific, the string of tariffs that are being imposed on US imports from China mainly include a range of medical devices that are extensively used by healthcare practitioners as well as medical device manufacturers. This will result in a significant increase in prices, which will compel US healthcare companies to hike the price of their services. Meanwhile, for the medical device manufacturers, this will imply a significant increase in their manufacturing costs, which they will invariably compensate by hiking the price of the end-product. Adding to their woes, the extremely volatile prices of raw materials such as polypropylene and a range of metals that are used to manufacture medical devices will spur the prices of these devices. Disposable syringes, wearable medical devices, laboratory equipment are some examples of such devices whose prices are highly susceptible to significant hikes.

However, the implementation of the revolutionary “Medicare For All” will make the worst nightmare of the health insurance segment come true. The advent of a single-payer program will curb the significance of private healthcare-insurers with no requirement to pay hefty premiums or out-of-pocket expenses. Considering the USD 1,048 billion value that this sector adds to the overall US healthcare industry, a slowdown in the growth of the healthcare insurance sector will put a lid on one of the major outlets of revenue for the US healthcare industry.

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Based on your observations, would you advise the investors to wait till the US healthcare industry bounces back to its old glory?

Tridib: Definitely not! A market of any shape, size, and stature is typically susceptible to highs and lows but never has a dearth of opportunities to grow and opportunities don’t wait. There is no doubt that implementing the “Medicare For All” act will eschew the US healthcare industry’s spend as it limits the scopes of out-of-pocket expenditures. However, it must be understood that compared with any other high-income countries, the gross value of the US healthcare industry will nearly double. The swelling demography of the aged and rising instances of lifestyle-related diseases such as diabetes and heart diseases will compel people to knock at the door of healthcare professionals, ensuring a steady and an assured source of investment for the US healthcare industry. The recent approval of a record 59 novel pharmaceutical products by the US FDA’s CDER will increase the availability of novel medicines which is expected to drive sales in the US healthcare industry. The patent expiries of branded drugs will encourage the governing bodies to issue their approval for generic drugs. Currently, generic drugs are experiencing higher demand than because of their lower price with the same therapeutic effect. This will further increase the scopes of sales in the US healthcare industry, thereby providing an ideal scenario for investments.

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According to you, what should a survival kit consist of for investors who are willing to explore the US healthcare industry?

Recent procurement market intelligence reports by SpendEdge have enlisted sets of procurement best practices that are typically attuned to the imposing challenges faced in the current US healthcare industry. I consider these recommendations made on procurement as an essential component in the survival kit in the dynamic US healthcare industry. For buyers, the increasing price of medical device is visibly their major concern. While increasing raw materials prices are compelling suppliers to increase the price of the devices, it is prudent of the buyers to select an ideal distribution channel which can open opportunities to save costs. For instance, engaging with suppliers within their geography will empower buyers with a better negotiation power which will usher more scope for discounts while reducing delivery time. Usage of medical components such as disposable syringes entails other auxiliary objects. Procuring all these objects separately will entail a skyrocketing expenditure. Therefore, it is advised that they consolidate their procurement requirements by engaging with suppliers that have a portfolio of diverse products to cater to the buyer’s diverse needs.

Want to know about the best procurement practices and strategies to maximize your ROI in the US healthcare industry? You are just a click away: 

Facilities Management companies

Top Facilities Management Companies | Facilities Management Services Procurement Research Report

London: SpendEdge, a leading procurement market intelligence company, has announced the launch of its Global Facilities Management Services Category – Procurement Market Intelligence Report.

Facilities management services play an indispensable role in ensuring the seamless functioning of an organization starting right from managing storage spaces to physical office areas. The top facilities management companies are being observed to integrate web-based technological platforms in their services that are providing a considerable impetus to the category feasibility. Buyers, as well as service providers, are developing a penchant for integrated facilities management services that are further driving the category spend momentum. Facilities management services command a significant share in an organization’s annual budget which typically overrides their allocated budget because of multiple organizational factors. This is emerging as one of the most recurring procurement challenges faced by buyers related to the facilities management services category. With a view of such potential challenges, this facilities management services procurement research report has made suitable recommendations that have aided some of the leading brands in achieving considerable cost-savings while procuring this category.

According to this report, strategic selection of the facilities management companies and a subsequent supplier base consolidation have been determined as some of the key strategies to optimize the procurement spend while maximizing the efficiency of the services. On a broader note, buyers are recommended to partner with service providers that have a portfolio of a wide range of services. This will exempt buyers from incurring excessive procurement spend on separate service providers while also minimizing the multiple-contract related complexities. Viability of facilities management companies must also be evaluated based on their data management and analytical capabilities that will play fundamental roles in determining the demand and the subsequent procurement of a wide range of services.

Partnering with such service providers will facilitate better maintenance planning, budget forecasting, and long-term category planning activities,” says SpendEdge procurement expert Tridib Bora. (more…)

Best Practices to Ensure Top Notch Supplier Quality

Manufacturing a product isn’t the same as it was about ten years ago, and it will continue to evolve. Today’s fast-paced business world is advancing to such an extent that business leaders must choose to consistently adjust to new emerging strategies to be at the top of the competition. Consumer packaged goods (CPG) manufacturers are under intense pressure to deliver quality products while keeping costs down. The push to globalize to meet customer demand, coupled with increasing mergers and acquisitions, makes it almost impossible for CPG companies to cost-effectively manage the quality of ingredients and materials across the supply chain. Supplier quality management (SQM) is a critical activity that relies on suppliers in the provision of the goods or services. It involves managing, monitoring, and responding to the changes in the supplier’s ability to fulfill customer’s needs on time and to meet the agreed quality specifications. Here are some best practices that will help CPG companies to streamlinSE_Demo2e their supply quality management better:

#Supplier quality check 1: Measure and track cost

If a product quality issue arises, it is often the parent company who bears the cost of poor quality, even though the fault may lie with a supplier. These costs can consume a significant portion of revenue, yet many companies fail to measure and track them in a consistent manner. This results in companies shelling out a bomb on poor quality every year, without knowing where or how to recover these costs. Companies must find out how much it costs to manufacture a good quality product. An appropriate ‘cost of poor quality’ metrics can also help to calculate supplier charge-backs accurately, and recover expenses faster.

#Supplier quality check 2: Set up a  cost recovery system

Agreeing on a cost recovery process with the suppliers can boost accountability throughout the supply chain. It may allow CPG companies to recover the cost of poor quality from a supplier with much more ease, and encourage them to look at and address issues that are causing poor quality quickly and efficiently.

#Supplier quality check 3: Supplier audit

Supplier audit is one of the key factors that will aid in ensuring supplier quality of CPG companies. Businesses can come to a consensus with suppliers on a procedure for a quality check against non-conformances in manufacturing, quality, service provision, compliance, etc. Audits will help companies identify areas for improvement and help ontake corrective actions, response and resolution processes, and targets. It will ensure that the supplier quality meets the desired standards.

#Supplier quality check 4: Build supplier relationships

Tracking supplier quality is not just about avoiding costly recalls, penalties, and lawsuits. It also aims at generating significant value for the business by strengthening overall product quality, enhancing the company’s reputation and credibility, lowering costs, and driving superior business performance. Companies must treat the suppliers as an extension of their enterprise and not a separate entity. Quality standards, audits, and other processes must be enforced with the same rigor and commitment in the supply chain as in the rest of the organization.

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