Overcoming Challenges In Life Sciences Transportation Spend Management
Life sciences supply chain management is complex, delicate, and critical—when your shipments save lives, the stakes are high. Factor in the nuances involved, such as temperature control and timeliness, and it’s imperative that you mitigate risk and overcome any challenges that could prevent your shipments from being delivered on time to the right location, or worse—damaged. The labor costs alone to analyze causes of damaged goods ranges from $3,000 to $10,000.
Trax is here to help you transform the challenges in life sciences logistics into opportunities so you can make the world healthier and become a leader in the market.
Extensive and Strict Compliance and Regulations
The unique regulations and compliance measures in life sciences, such as temperature, humidity, pH balance, security, and time constraints, are vital in keeping your end-users safe. Getting your shipments to the right destination at the right time relies heavily on your shipments being error-free and avoiding mishaps or delays. It’s no easy feat, especially if global shipping is interrupted by a catastrophe like the COVID-19 pandemic.
A common challenge within compliance and regulations is the packlist delaying a shipment at port. If the packlist has errors, such as the origin location, what’s inside, or the value of the contents, the shipment is grounded until the issue is resolved. Such a delay in life-saving shipments could reduce—or even ruin—product efficacy, hurting both your customers and budget. Considering that many life science companies ship to NGOs in countries ravaged by instability, maintaining absolute compliance is key to avoid shipments getting stuck in ports where getting them out can be a major challenge.
The solution is mitigating errors in order to prevent delays in the future. Optimizing Transportation Spend Management processes creates the visibility and process rigor to make this possible. You can negate this type of risk even further by evaluating carrier performance through a tool like Trax’s Performance Manager to ensure your shipments’ quality and compliance while optimizing your carrier management process so you always choose the best carrier for the job.
Only 6% of supply chain leaders are confident they have complete visibility over their life sciences supply chain. End-to-end visibility is another major obstacle, especially with the strict shipping requirements, multimode and multicarrier handling, and more. But implementing a robust Transportation Spend Management strategy gives you visibility into the intricate details of your supply chain, providing cohesive data spanning the global transportation network.
Enhanced visibility also helps optimize your inventory management. Overstocking may lead to spoiled products, while understocking means lost opportunities and lives put on the line. In order to walk the fine line, you need the insights and data to help you make crucial decisions.
When you have complete visibility, you can uncover gaps or weaknesses in your supply chain, such as root problems of frequent damages. These real-time data insights, which are possible with Trax’s Data Compliance Manager, help you determine where the problem lies, whether it’s with handling, loading or unloading, or otherwise. Such high-quality, real-time data helps resolve and mitigate risks in the future.
Higher Rate of Damage Claims
Damages are a part of supply chain management, but they’re more common in life sciences because of the high environmental and safety requirements. The slightest mishap can result in entire shipments going to waste—legal and safety measures require that a damaged box of pills, for example, must be disposed of even if the contents appear fine.
Damages can occur unknowingly, such as during inspections or multimodal shipping. If customs opens a package to match it to the packlist, that’s not a problem for most shipments. But it could mean a costly loss for a life sciences shipment of sterilized, high-value surgical equipment to a developing country. With multimodal shipping, there are often longer delivery times that are a challenge for temperature- and humidity-sensitive shipments. This could mean a shipment traveling through particular regions or seasons with high temperatures is damaged by the time it arrives at the destination. Through Trax’s carrier management and transportation optimization solutions we can help identify damage patterns so you have the data in hand to figure out how to prevent losses such as these in the future.
To truly proactively avoid damages, though, you must set up comprehensive visibility, unhindered control, and optimized processes, which is exactly what Transportation Spend Management offers. Not all carriers are equal when it comes to life sciences logistics—some are more adept than others. You need to choose the best carrier every time and establish a symbiotic relationship that helps mitigate damage risk to your shipments. A combination of our RFx Manager and our Carrier Management Services can help you achieve this.
Even when astutely mitigating risk, accidents happen, making it essential to have efficient and error-free claims management. This is possible through optimizing your claims management process and leveraging technology, such as Trax’s Claims Manager.
High Costs Associated with Life Sciences Logistics
Life sciences logistics have higher average costs than normal shipping, as they require specialized measures that ensure products arrive safely, such as temperature-controlled containers. As many as 80% of shippers reported an increase in cold chain costs in 2020, while The GCCA’s Cold Chain Index reported a 2.06% increase in refrigerated warehousing expenses. The costs associated with necessary shipping protections are a major factor in a company's success.
In life sciences, it's not only the shipment that’s at risk, but the lives of the end-users. Delays are costly—both in terms of lives and finances. Faster delivery is more cost effective since less is paid on refrigeration or specialized shipping environments. You need to deliver shipments quickly, safely, and at the lowest cost so you can keep growing your reach and business to save more lives. You can gain better budgeting, forecasting, planning, and delivering within your objectives through Trax’s Accrual Manager and our Budget Manager. Easily identifying the best carrier rates, whether they’re contractual or spot quotes, with a tool like Rate Manager also helps boost your profit margin.
Don’t forget about other transportation spend factors, like surcharges and warehousing prices. It’s imperative to know what you spend and where throughout your life sciences supply chain. This is possible through Trax’s Transportation Spend Management Maturity Model, a framework that provides a roadmap for large, global enterprises to shift from a lack of visibility and control to a fully optimized and accurate data-based transportation supply chain for all modes and geographies. You can expertly mitigate risks in your life sciences supply chain, drastically reduce costs, and gain global dominance through a perfectly balanced and effective logistical network.
Optimizing your Supply Chain Saves Lives
Life sciences supply chain management is riddled with challenges, but those challenges can be turned into opportunities. Flawlessly navigate transportation regulations, mitigate damage risk, and overcome other obstacles. Optimize your complex life sciences supply chain management for unparalleled visibility and control with Trax’s Transportation Spend Management Maturity Model so you can safely deliver your shipments on time to the right location and save lives. Contact Trax today.
Trax is the global leader in Transportation Spend Management solutions. We partner with the most global and complex brands to drive meaningful optimizations and savings through industry-leading technology solutions and world-class advisory services. With the largest global footprint spanning North America, Latin America, Asia, and Europe, we enable our clients to have greater control over their transportation performance and spend. Our focus is on your success.