HHS SUPPLY SERVICE CENTER Controlling Costs Improving

HHS SUPPLY SERVICE CENTER Controlling Costs / Improving Delivery

HHS Supply Service Center Our Goal. . . The Perfect Order q q q q Has the right amount of the right products Is damage free Arrives on-time Arrives at the correct location Is filled completely on the first call Is entered correctly Is communicated via a customer-specified medium Has no invoicing/collection errors

HHS Supply Service Center Communication is THE Key Pacific Islands q Order from Pre-defined Formulary q Develop Comfortable Safety Stock Levels q Routine Orders q Prompt Payment

HHS Supply Service Center Formulary Development Reasons q Issues of Safety, Effectiveness, and overall Value - SSC has staff pharmacist on staff for help q Product Availability q Cost Savings q Supply Chain Speed Problems with Non-Stock Items q Sometimes Difficult to Procure q Dating Issues q Require Multiple Small Shipments - high transportation costs

Formulary Advantages Cost Issues q. No Price Changes q. Minimize Pricing - Quantity Discounts - Repackaged Items q. Optimization of Transportation Costs - Maximization of Ocean Freight - Minimization of Air Freight - Minimize Minimum Charges (Customs Fees, Hazard Fees) q. Minimize Labor Required to Correct Issues

HHS Supply Service Center Satellite Warehouse Reasons q Gain Shipping Efficiencies - Negotiate favorable tenders - Minimize emergency shipments q Emergency Product Availability q Decrease Response Time q Cost Savings (buy larger quantities) Requirements q Formulary q Minimize Non-Stock Items Requirements q Utilize SSC Information Systems q PIHOA Endorsement is a Critical First Step Product Pricing is Important – Transportation Optimization MORE Important!!!

HHS Supply Service Center Satellite Warehouse Can a satellite warehouse support itself? q Most shipments now go Air Freight q Ocean freight is an appropriate response q What cost savings can be achieved? q Can these cost savings cover potential 3 PL expenses? Variables to Address q Formulary Volumetrics and q Velocity 3 PL Storage and Transaction Costs

HHS Supply Service Center POINTS OF CONTACT Steven Pearson, Director Work #: 410 -642 -1380 Cell #: 443 -693 -3240 E-Mail: Steven. Pearson@psc. hhs. gov Mark Burchess, Chief, Logistics Operations Branch Work #: 410 -642 -0702 Cell #: 443 -693 -3197 E-Mail: Mark. Burchess@psc. hhs. gov Trisha Futty, Management Analyst Work #: 410 -642 -0710 E-Mail: Trisha. Futty@psc. hhs. gov Irene Grubb, Business Operations Manager Work#: 410 -642 -1389 Cell #: 443 -693 -3239 E-Mail: Irene. Grubb@psc. hhs. gov Timothy Bouchelle, Acting Chief, Procurement Work #: 410 -642 -1383 E-Mail: Tim. Bouchelle@psc. hhs. gov