When we’re looking into the healthcare procurement sector, there are several factors that stand out as being important to the professionals.
Starting with some context is hardly necessary but the big issues still have knock on effects. Global supply chains have been all but mutilated by the impacts of Covid-19; border closures, staff shortages and economic crises are only the starting point.
At the start of 2020 this forced people into new procurement strategies that changed procurement criteria drastically. Supply issues were highlighted by a series of events including non-pandemic-related events.
One thing has remained a baseline, however, for healthcare procurement.
Compliance & Quality of Product
Clinical acceptability and compliance are of paramount importance.
Being a compliant and reviewed product is highly important from a clinical perspective where the user is dealing with people’s lives, and indeed their own. This is especially relevant for PPE, where such high-volume items are manufactured by such a wide variety of companies. Since before the pandemic and indeed after the pandemic, this is a solid criterion that will not be sacrificed.
Origin of Supply
What has infamously fluctuated is the consideration for origin of supply. The pandemic most certainly highlighted the value of locally manufactured goods. We thought the global supply chain was strong; once the pandemic hit, this was totally exposed. Aside from government restrictions, we found that relatively small events can have a disastrous knock-on effect on the global system, incurring massive delays, significant increases in cost of logistics and lack of accessibility to modes of freight such as airfreight.
Previously, price has always played a factor in decision-making when buying. It always will, but its significance paled in the early days of the pandemic when availability was everything. Procurement professionals rated this last in the selection criteria used when buying. Ability to supply meant that manufacturers took advantage of huge demand and price inflation was seen across the board, in some cases up to 600% increases in price.
Since then, we’ve seen prices normalise somewhat, leading to increased stability in buying, and greater ability to move.
To summarise, what has remained important and always will no matter what, is compliance and clinical acceptability.
However, from a strategic point of view, procurement is more intelligent about securing long-term supply, taking the work out of procurement while keeping options open. While long-term supply is available, due to the volatile global situation professionals are avoiding arranging binding contracts to be able to ensure greater control.
What professionals are looking for now is not run-of-the-mill companies, nor pop-up vendors, but innovative, agile, energetic and reputable businesses who can manage supply in fluid situations and are able to manage and secure supply chains in order to deliver on promises.