A high-profile pharmaceutical client needed an efficient warehouse and distribution management system to maximize shipment capacity and flexibility in a highly competitive environment.
Tocan provided a TMS to optimize route planning for over 700 vehicles in 13 regions spanning multiple warehouses and production facilities.
Thanks to the new system, Yuria-pharm can deliver 78 percent volume without increasing the number of vehicles. Moreover, shipment cost has dropped by 22 percent.
With operations in 41 countries and over 2700 employees, Yuria-pharm is among Ukraine’s top three pharmaceutical companies. The company manufactures over 290 million medicine and medical device units and accounts for nearly eight percent of the hospital distributions in Ukraine.
Throughout its 30-year history, Yuria-pharm has operated in a hyper-competitive environment. It faces intense pressure to develop new drugs each year with continually squeezing profit margins. In 2020, despite these pressures, the executive team adopted an aggressive expansion strategy. Therefore, the company needed to optimize and grow its distribution network to facilitate sales and increase profit margins.
When Yuria-pharm reached out to us, the company was in the midst of a significant sales push. So, it needed a way to ensure shipments arrived on schedule with minimum cost.
It boasted a dedicated distribution network spanning 13 regional centers and multiple production facilities and warehouses, while its fleet consisted of 200 trucks and 500 cars. Additionally, third-party logistics companies were sometimes hired to handle demand spikes. However, the company’s legacy routing system wasn’t designed to meet the requirements of a large-scale enterprise with a growing list of customers. As a result, delays and unexpected costs were common.
After an extensive search process, Yuria-pharm’s executives selected Tocan’s Transportation Management System (TMS) as the ideal solution. We provided a fully customizable system that eliminated planning inefficiencies. More importantly, our software offered unmatched flexibility, accommodating Yuria-pharm’s future growth.
In close collaboration with the client’s logistics team, our experts surveyed the existing infrastructure to pinpoint the weakest points in the network. Our objective was to maximize product shipments while minimizing costs. To achieve this goal, we focused on the processing nodes, regional warehouses, and routes, allowing us to optimize vehicle assignments to regions and warehouses.
We designed a fully customized solution using three components in the Tocan ecosystem:
Using Tocan’s configurable solution, Yuria-pharm can now plan routes for its entire distribution chain in under 25 minutes. The new system quickly regenerates routes when any changes occur in the supply chain. It also accounts for maintenance (parts and labor), overhaul, tires, batteries, and other consumables to minimize costs.
The new process was implemented without adding extra technicians. However, when necessary, technicians can be trained in less than 30 hours.
The new mobile application lets the company track actual route execution via GPS. It automates manual events, such as odometer readings and shipment delivery notifications. Moreover, Yuria-pharm now has access to a comprehensive dashboard that enables analysis by divisions and vehicle types.
These changes increased product delivery capacity by 78 percent while cutting costs by 22 percent. As a result, the company reached its sales goals and improved its bottom line.