5 Tips to Reduce Your Pharma Shipment Expedite Costs
Pharmaceutical products have always come with extra transportation challenges, and the volatile nature of fulfillment doesn't help to keep costs down. Managing these costs calls for ongoing awareness, strategies and insights that help you understand the real-world movements of your products and avoid the need for expedited shipments. To help you stay competitive, we've put together some tips on how to lower pharma shipping costs.
1. Use Real-Time Data for Continuous Planning
Monitoring solutions are plentiful and well within reach, even for companies on a tight budget. The 21st century has brought unparalleled data collection options and the means to understand it. A great way to reduce medical inventory transit costs is to improve your visibility, gaining a central picture of your products' movements.
You might collect information like product location and temperature, but you can also go further and gather data on your shipping partners' capacity or potential weather interruptions. Amidst rising shipping costs, one pharmacy even started contacting patients ahead of bad weather to make adjustments and avoid delays. This strategy could help avoid customer upset and avoid expensive write-offs due to delays that affect product quality. Other organizations are rethinking the use of warehouses to reduce the length of final-mile deliveries.
There are many ways to reduce transit costs in pharma, but almost all of them require real-time information about the products. Real-time monitoring, often collected through sensors, can also help you collect required documentation and create a paper trail for regulatory authorities.
One of the most effective ways to lower pharma supply chain costs is to use a digital twin. A digital twin is a virtual model of your entire supply chain, from the manufacturing floor to the customer's doorstep or warehouse. It can monitor all operations in the supply chain and offer insights at every stage. Digital twins can help you make decisions in context with other aspects of the supply chain and alert you to problems immediately, so you can make plans and avoid costly delays or quality issues.
2. Prevent Expedited Shipments Due to Temperature Excursions
Even the smallest differences in temperature can render a shipment unusable, leaving you to make expensive expedited shipments to make up for it. Some preventative measures can help you keep excursions to a minimum and reduce the expedited shipping costs associated with them to a minimum.
Take some time to assess the characteristics of your products' transit, such as:
- Climate control: What kind of climate control solutions do your transportation partners use? If you're regularly facing temperature excursions, more expensive, climate-controlled trucks may pay off in the long run.
- Weather interruptions: Consider implementing a process to watch for weather-related situations, such as storms that might leave your products sitting for too long at a warehouse. You'll also need a process for making adjustments as needed to keep your product at the right temperature and ensure your shipments reach their destinations on time.
- Monitoring frequency: Make sure you're checking on your supply frequently. Look for any gaps in your monitoring process to ensure your product stays at the appropriate temperature throughout the entire transportation process.
- Driver and handler certifications: Some partners may have trained and certified workers handling the products. Consider working with a transportation company that can offer extra security through these qualifications.
- Remote responses: If your product starts to go out of range, are you able to do anything about it, or will you only find out once it reaches its destination and is unusable? See if you can update your monitoring solution to include real-time updates which would allow you to take action if temperatures start to rise or fall.
3. Optimize Shipping Costs Through Advanced Analysis
Another boon of the 21st century is analytics. By feeding huge swaths of data into supply chain software, you can learn more about your shipping costs. With these insights, you can make data-driven decisions to reduce transit costs in pharma and maximize its value.
For example, if you use a digital twin model, you can run “What-If” scenarios to see how certain changes might affect your profits. Decision intelligence can suggest optimized routes, warehouses and carriers to help you meet your on-time in-full shipment goals. By considering your entire supply chain, analytics tools can efficiently calculate ideal solutions with complex data inputs to find the best combination of resources, like alternative freight options or approaches that mitigate risk.
Advanced insights can tackle nearly every aspect of shipments, such as how surcharges for fuel and hazardous goods might add up or whether a spot rate or contract rate would be more lucrative for you. Finding this kind of contextual information through manual processes would be incredibly difficult, if not impossible, as these insights rely on many rapidly changing data points. Modern analysis tools can quickly pay for themselves by finding new ways to save and improve operations.
4. Identify the Best Freight Option
Knowing how to ship pharmaceuticals cheaper also means knowing when to spend more on freight. The right freight option may not be the cheapest one. Say the lowest-cost transit partner comes with multiple stops. Each of those stops creates more risk and opportunity for delays or damage. Another partner may be slightly more expensive but offer speed and reliability that will save you more in the long run by helping you avoid costly expedited shipping.
Explore all of your options and consider the costs and benefits of each. Again, a digital supply chain platform can help, offering side-by-side comparisons of different freight options. It can also show long-term insights about how your transportation partners perform over time.
5. Rethink Your Packaging
Of course, large dimensions and heavy packages will increase the cost of shipping, especially if you need to use expensive freight options like air for expedited shipments. Still, good packaging also adds security. Evaluate your packaging and look for areas where you may be able to reduce costs or risks of damage. Pharma shipping strategies for cost reduction can be challenging due to the sensitive nature of the products, but some areas to consider include space-saving designs, insulation and lightweight materials.
Consider the labor associated with your packaging, too. If you can minimize the time it takes to pack and unpack materials, you may be able to stick to schedules more easily and save money on labor.
Lower Your Pharma Supply Chain Costs With ParkourSC
Pharmaceutical companies deal with complicated fulfillment processes. Leveraging data from each step of your supply chain can significantly reduce costs, but it requires advanced software solutions. That's why we made ParkourSC, a cloud-based supply chain operations platform based on digital twin technology. We'll create a virtual model of your supply chain with real-time visibility and advanced insights. ParkourSC is an end-to-end system that can help you monitor, understand and act on information from the pharmaceutical supply chain.
Whether you need to hone in on certain areas to reduce expedited costs or you're not sure where to start, ParkourSC can help. Reach out to us today to learn more about how the platform can help pharmaceutical manufacturers and medical or life sciences companies create a more resilient, cost-effective supply chain.