How to win the last mile in healthcare ecommerce distribution
When searching for reliable ecommerce distribution, retailers must carefully sift through each step of the process.
Several criteria are involved in building confidence that distribution will deliver the right product at the right time to the right household.
This expectation heightens for healthcare ecommerce, where customers may be urgently seeking essential, life-altering products. And the stakes are high; retailers who successfully deliver this experience can expect strong customer satisfaction and increased loyalty.
To win the last mile in healthcare ecommerce distribution, retailers must demand superior speed, accuracy and efficiency for every transaction.
Here are some strategic ways healthcare ecommerce distributors are accomplishing these goals.
Strategic positioning of distribution centers
An easy-to-navigate website and competitive prices won't mean nearly as much to a customer who cannot get their orders filled in a timely fashion.1
Retailers looking to expand their healthcare ecommerce opportunities should seek a partner with enough fulfillment and distribution centers spread across their targeted delivery areas to maintain rapid turnaround from order to delivery.
For example, McKesson Medical-Surgical has 17 distribution centers, resulting in a next-day customer delivery rate of 95% and a 98% delivery rate within two days.
Superior order accuracy
Customers depend on healthcare ecommerce distributors to deliver essential items.
Typically, considerable thought goes into the how and how often purchased medication, supplies and equipment delivered to customers and caregivers are used.
Physicians have recommended these items to maintain quality and continuity of care in some cases. Overall, order accuracy directly impacts customer experience and will play a role in whether they continue ordering online, so it's essential to get it right.
McKesson, for example, maintains a superior 99.8% order accuracy rate.
Advanced inventory systems
In order to improve order accuracy, inventory systems must be constantly re-evaluated and streamlined along each step of the process.
By offering real-time ordering and inventory management, McKesson takes the guesswork out of what products are available to retailers for their customers.
Additionally, the following practices can make or break order accuracy:
- Utilize demand forecasting. To stay ahead, study past customer demands. Using this data can help predict future orders and signal if and when additional workers are needed
- Maintain stock level accuracy. Always know what stock you have on hand to fulfill orders efficiently
- Practice inventory control. Avoid having too much or too little of a product in stock by keeping a record of past orders, reorder rates, and customer satisfaction or turnover2
Fill rate transparency
In addition to order accuracy, top-notch healthcare ecommerce distribution requires a near-perfect fill rate, meaning any out-of-stock notification is the rare exception.
To maintain an excellent fill rate, distributors must keep track of their missed sales and out-of-stock notifications, effectively communicate any deficits to customers and inform them when they expect to fulfill their orders.
Incidentally, having a 100% fill rate is not necessarily a good sign because it could indicate overstocking, which may drive up overall costs.
Instead, distributors should suggest alternatives for customers where applicable.3 For example, if a box of 100 syringes is out of stock, you can offer two boxes of 50 instead.
Streamlined logistics management software
Central to best-in-class healthcare ecommerce distribution is advanced integrated software. There are many steps to manage within the last mile, involving dispatchers, drivers, shippers and ultimately the customer. Effective ecommerce distribution relies on efficiency and accuracy.
Key features of logistics management software include the management of:4
- Warehouse: This aspect of the software tracks stock and the activity of warehouse workers and systems
- Supply chain: A continuous record of supply chain concerns, including low inventory, purchasing, trends in distribution and order fulfillment
- Transportation: Manages how the products are moving from warehouse to customer
- Any third-party fleet: More often than not, companies contract third-party fleets for transportation, even businesses with their own fleets. Keeping track of third-party fleet movement is essential for ecommerce distribution
- Route optimization: In order to keep transportation costs such as gas, man-hours and vehicle wear and tear low, planning routes efficiently is critical5
- Drivers and vehicles: Tracking vehicles help keep customers updated as to the anticipated delivery of their orders and improves drivers' efficiency
- Documents: Keeping all records using the same software program minimizes error and omission
With 185 years of experience as a healthcare distributor, McKesson has extensive experience leveraging the right technology and tools to support the nation's largest marketplace sellers, pureplay sites and drug store retailers.
Customers have many options when it comes to fulfilling their healthcare ecommerce needs. But to win that last mile, retailers must achieve superior speed, accuracy and efficiency, all while meeting the unique needs of their customers in this ever-changing landscape.
Is your ecommerce strategy ready to grow with consumer demand? Learn how we support retail ecommerce to help drive more revenue for your healthcare business.
© 2022 McKesson Medical-Surgical Inc.