Healthcare organizations and medical distributors are facing unprecedented financial pressures. From tightening budgets to rising operational costs, the need to reduce waste and drive efficiency is critical. In highly regulated supply chains, that’s not easy. Over-ordering, expired inventory, and inefficient manual processes are common culprits that drive up costs. Fortunately, modern inventory optimization solutions like Netstock are built to meet these challenges head-on.
With smarter demand planning, automated replenishment, and real-time visibility, Netstock helps healthcare supply chains lower inventory costs while maintaining availability, compliance, and patient care standards.
Key takeaways
- Inventory inefficiencies inflate healthcare costs. Overstocking, expirables, and manual processes are common issues in provider and distributor supply chains.
- Smarter planning reduces waste and improves availability. Platforms like Netstock enable data-driven forecasting and right-sized inventory, without compromising care or compliance.
- Real-world case studies show measurable success. Organizations have cut costs and improved service levels through better inventory visibility and planning.
- Cost reductions impact more than just inventory. Benefits include lower carrying costs, fewer emergency orders, improved cash flow, and stronger budget predictability.
Why healthcare supply chains struggle with inventory efficiency
Healthcare supply chains are uniquely complex. Hospitals, clinics, and medical distributors must maintain stock for thousands of items: from pharmaceuticals and surgical tools to PPE and single-use kits – all while managing expirables, unpredictable demand, and tight compliance requirements.
Despite this complexity, many healthcare organizations still rely on manual ordering systems or outdated forecasting spreadsheets. These methods leave room for human error and lead to widespread inefficiencies:
- Over-ordering: Fear of stock-outs prompts excessive inventory purchases
- Expired inventory: Perishables and dated items often go unused
- Emergency orders: Lack of visibility creates avoidable last-minute shipments
- Manual processes: Time-consuming workarounds drain staff resources
These problems directly affect budgets and operational performance. Yet inventory management is still an underutilized lever for cost reduction – especially in provider settings where clinical and procurement teams may be siloed.
In highly regulated industries like healthcare, making smarter inventory decisions isn’t just a cost-saving opportunity; it’s a compliance and care imperative. That’s where inventory planning solutions like Netstock make a measurable difference.
3 real-world examples of medical supply chain optimization
Starkey
In just three months, Starkey delivered impactful results by integrating Netstock with their Oracle ERP. They achieved a 20% reduction in overall inventory while also improving customer fill rate by 2%, even as the COVID-19 pandemic shook the healthcare industry.
To achieve these benefits and move, Starkey successfully implemented:
- A monthly S&OP model for reviews and input from sales and marketing plans by region and segment
- A formalized demand review process
- A monthly report of forecast variability and bias
Today, Starkey’s S&OP model globally receives monthly forecast input from users in 12 countries worldwide.
“The model was the cornerstone of a new formalized monthly demand review process, and it helped sharpen our ability to plan for promotions, product cannibalizations, trends, and exceptions.” – Mike McMullen, Starkey’s Director of Global Materials & Inventory.
Medshop
Medshop operates across multiple product categories and warehouses in Australia and the Pacific Islands. Before Netstock, planners struggled with inconsistent forecast accuracy and growing excess stock. Within six months of deployment, Netstock helped boost product availability by 14% while sales rose by 38%. These benefits for both the brand and consumers were achieved with only a 16% increase in focused inventory investment.
Keir Surgicals
Keir Surgical supplies critical, life-saving items to hospitals. Before investing in inventory management, they struggled with creating accurate forecasts.
“Supplier lead times were always a guess and based on a supplier’s full line as opposed to individual items. It took tedious amounts of time to work out our orders each month, and I would need to go back and check every row to make sure that the calculated number made sense based on the three or 6-months sales trend,” says Martin Reeves, Operations Manager.
Since integrating Netstock inventory optimization software with their ERP, the business has been able to move past processes based on spreadsheets, intuition, and guesswork. This has since allowed them to reduce inventory levels whilst maintaining high fill rates and better serving the hospitals and clinics that need their critical products.
The measurable financial impact of healthcare supply chain optimization
As these real-world examples highlight, smart inventory optimization isn’t just a procurement tactic; it’s a financial strategy. In healthcare, where budgets are tight and inventory needs are unpredictable, efficient planning can deliver significant bottom-line gains.
Key metrics improved with supply chain optimization:
| Metric | Financial Benefit |
| Inventory carrying cost | Lower average inventory = reduced capital tied up |
| Working capital efficiency | Frees up cash for growth or care delivery |
| Inventory turnover | Faster movement = less waste from expirables |
| Emergency courier fees | Reduced by smarter reorder timing |
| Stock-outs/backorders | Decreased through better forecasting |
These outcomes allow CFOs and supply chain leaders to redirect spending, improve vendor negotiations, and build more resilient operations. All without requiring major ERP upgrades or large planning teams.
Netstock for healthcare and medical distribution: Fast results, minimal lift
Netstock was designed with supply chain-intensive industries in mind – especially those like healthcare and medical distribution, where demand shifts quickly and margins are tight. It brings advanced inventory forecasting and optimization to the front lines of stock planning, without requiring deep technical knowledge or additional headcount.
Built for fast-moving supply chains
- Automatically adjusts to seasonality, vendor lead times, and product lifecycles
- Forecasts demand volatility with greater accuracy using historical trends
- Prioritizes high-impact SKUs and flags problem areas before they cause disruption
- Reduces waste from expirables by optimizing order frequency and size
Integrates with your current ERP
- Seamlessly connects to ERPs commonly used in healthcare (including NetSuite, SAP, Sage, and others)
- Implementation typically takes just 30–60 days
- Delivers fast time-to-value with minimal internal IT support
By layering Netstock on top of your existing ERP, healthcare organizations get the best of both worlds: an operational backbone (ERP) paired with predictive, agile inventory planning.
Learn how else Netstock serves suppliers and producers in the healthcare industry.
Why inventory management protects both patient care and your bottom line
Healthcare organizations face constant pressure to reduce costs, but the solution doesn’t have to come at the expense of quality or compliance. By investing in smarter inventory planning, hospitals and distributors can reduce waste, improve supply availability, and protect budgets, all while maintaining high standards of customer care.
Platforms like Netstock offer a low-lift, high-impact way to bring supply chain optimization into your operations quickly, measurably, and securely.
