How E-Commerce is Transforming the Healthcare Supply Chain
E-commerce has experienced significant growth in recent years, especially in the healthcare sector. The COVID-19 pandemic further accelerated this trend, leading to a dramatic increase in e-commerce utilization. Matt Burns, Director of E-commerce Solutions, discussed how e-commerce is transforming the healthcare supply chain and highlighted the key drivers behind this transformation.
Dramatic Increase in E-commerce Utilization
Before the pandemic, e-commerce was already expanding globally. Factors like aging populations, government-led initiatives, and the increasing penetration of the internet contributed to this growth. Market research reports projected the global online healthcare market to reach 643 billion by 2025, representing an increase of almost $200 billion in just a couple of years.
Impact of Consumerism on the Healthcare Supply Chain
Consumerism has played a crucial role in transforming the purchasing landscape in the healthcare industry. The concept of online buying, convenience, and transparency, which are prevalent in consumer e-commerce, has transcended into the B2B space. Companies like Amazon have influenced the purchasing experience, leading to the integration of similar features and functions into other e-commerce platforms. The COVID-19 pandemic further accelerated this shift as organizations and individuals embraced online buying more than ever before.
The Role of Alternate Site Membership
Alternate site members, mainly smaller businesses and buyers in the healthcare supply chain, are gaining increased attention in e-commerce utilization. These smaller buyers face resource constraints and disruptions, making them more inclined to explore alternate suppliers and e-commerce modalities. E-commerce platforms provide them with an opportunity to access a broader range of products, connect with new suppliers, and leverage technology in their procurement processes.
Purchasing Concerns in E-commerce
While e-commerce offers numerous benefits, there are also concerns that buyers should be aware of. These include price gouging, counterfeit goods, black market products, retail theft, alterations to products, non-delivery, and back orders. To mitigate these risks, buyers should evaluate online purchasing platforms carefully and consider factors like reputation, security, and authenticity of products.
Incorporating E-commerce Offerings into Business
From a business perspective, incorporating more e-commerce offerings can make the supply chain more resilient. By diversifying suppliers geographically and leveraging e-commerce partners, businesses can gain access to alternate sources, identify disruptions, and manage purchasing data effectively. Utilizing e-commerce platforms also offers advantages like sourcing flexibility, streamlined payments, and immediate inventory access, complementing primary relationships with other companies.
The Future of E-commerce and the Supply Chain
Looking ahead, several trends are expected to shape the future of e-commerce in the healthcare supply chain. Non-traditional players like Walmart, Amazon, Kroger, eBay, Walgreens, and CVS are expanding their strategies and capabilities in the healthcare space. Telemedicine, blockchain, smart contracts, augmented reality, and cognitive supply chain management are also emerging as potential game-changers. Regulations focusing on buyer protection are likely to impact the e-commerce space while further enhancing the expansion of telemedicine services and product offerings.
E-commerce, healthcare supply chain, consumerism, online buying, alternate site membership, purchasing concerns, business resilience, geographical diversification, e-commerce offerings, future trends.
Q: Why has e-commerce utilization in the healthcare sector experienced significant growth?
A: Several factors, including the aging population, government initiatives, and increased internet penetration, have contributed to the expansion of e-commerce in the healthcare sector. The COVID-19 pandemic further accelerated this trend.
Q: How does consumerism impact the purchasing landscape in the healthcare industry?
A: Consumerism has introduced concepts of convenience, transparency, and online buying into the B2B space. E-commerce platforms, influenced by consumer e-commerce giants like Amazon, offer similar features and functions, transforming the purchasing experience in the healthcare industry.
Q: What is the role of alternate site membership in the healthcare supply chain?
A: Smaller businesses and buyers, referred to as alternate site members, face resource constraints and disruptions. E-commerce provides them with an opportunity to access a wider range of products, connect with new suppliers, and leverage technology in their procurement processes.
Q: What are some purchasing concerns to be aware of in e-commerce?
A: Purchasing concerns in e-commerce include price gouging, counterfeit goods, black market products, retail theft, alterations to products, non-delivery, and back orders. Buyers should carefully evaluate online platforms and consider reputation, security, and product authenticity.
Q: Why should businesses consider incorporating more e-commerce offerings?
A: Incorporating e-commerce offerings can make the supply chain more resilient by diversifying suppliers, leveraging technology for disruption identification, and streamlining purchasing data. It offers sourcing flexibility, streamlined payments, and immediate inventory access.
Q: What future trends can we expect in e-commerce and the healthcare supply chain?
A: Non-traditional players like Walmart, Amazon, and Kroger are expanding their capabilities in the healthcare space. Telemedicine, blockchain, smart contracts, augmented reality, and cognitive supply chain management are also expected to shape the future. Increasing regulations will focus on buyer protection, and the expansion of telemedicine will offer extended services and product offerings.