Pharmacies in Africa struggle with access to finance, but inventory management is really what bogs them down. HHow do pharmaceutical retailers know how much stock they need? How do you know which products to store at any given time? How do you know which products are not selling?
At the moment, there is not enough data to answer these questions.. Cash is immobilized; there are more or less products that Are needed on a certain moment. If it is the former, they run the risk of selling expired products. If it is the latter, patients cannot get what they need..
Field intelligence is digitizing this supply chain process to help African pharmacies sell better. The company, which started in 2015, was focused on the government and sought to address the challenges facing the public health supply chain in Nigeria’s capital Abuja.
Co-founder and CEO Michael Moreland said he noticed independent pharmacies in Abuja faced similar challenges as government-owned ones. After building a SaaS platform to manage large-scale and complex pharmaceutical distribution for the government, the company decided to expand into the private space.
In trying to solve that supply chain problem, Field Intelligence went from strictly be a software company to become a pharmaceutical distributor using technology to reinvent how the value chain works.
Launch of Field Intelligence Duration in 2017 as the standalone product to handle this transition. Until now, they had operations in Abuja, Lagos and Nairobi. The product aims to solve the inventory problem in Africa $ 65 billion pharmaceutical market. Today, the company announced its expansion to 11 cities in Nigeria and Kenya. Nigeria’s seven cities include Delta, Edo, Enugu, Kaduna, Kano, Kwara, and Rivers. In Kenya, they are Eldoret, Kisumi, Mombasa and Naivasha. The expansion will build on the more than 700 existing Field Intelligence pharmacies, which have so far served more than 1.4 million patients.
Shelf Life takes the burden and risk out of pharmacy inventory. Manage forecasting, quality assurance, compliance, and inventory management through a subscription service. Pharmacies sell products supplied by Shelf Life on consignment through a pay-per-sale program, avoiding expiration risk and accessing a cheaper alternative to working capital financing. The company claims that this model allowed pharmacies to grow an average of 25% CAGR.
“We launched Shelf Life in 2017 to allow pharmacies to outsource their supply chain to us. And it is Really single grew very organically from there, ”Moreland said. “And as we build, we expand to Lagos and Finally to Nairobi to see if it would work in East Africa in that context, and it did. We haven’t looked back since. The future of the business is in the private pharmacy market ”.
Field Intelligence concluded its first round of external capital in March of last year, a Series A of $ 3.6 million. The money was bred for expansion, but the pandemic stopped that plan. Field Intelligence was back online at the end of the fourth quarter of 2020 and planted the initial seeds of what has grown thus far..
Importance of data in Field Intelligence operations
This expansion comes a year after the company experienced rapid sales and Shelf Life membership subscriptions. Sales grew 47% in Nigeria and 65% in Kenya, selling more than 586,950 products in 63 different product categories..
By using data to optimize predictions and identify market irregularities, Field Intelligence met the demands for prescription and over-the-counter drugs. But how do you receive and add these dates?
“We see that as a math problem. And that starts with having Really excellent data on what is sold in a large number of locations and different seasons, in a broad product form, ”said the CEO.
When Field Intelligence introduces Shelf Life to a pharmacy, it takes over its supply chain and inventory management processes. The company has compliance partners to manage pharmacy stock counts, inventory management, and merchandising.
Data on positions and stock movements at the retail level comes from a wide range of locations.. Therefore, the company can create a proprietary data set that displays pharmacies in real time, providing information on demand.. With that, Field Intelligence provides visibility and control of pharmaceutical procurement and inventory management. This eliminates frequent overstocking and understocking; Pharmacies may change products or prices based on available information.
The compliance partners operate a lean asset model, which Moreland says allowed the company to “build a smart and scalable distribution service that operates in a lean manner but creates a lot of value for patients and retailers.”
“I can say that our level of the value chain here as a kind of technology-enabled distributor, there is no one operating at this level of the supply chain in so many cities,” he added.
The shelf life is currently being used in more than 700 pharmacies in Nigeria and Kenya. The company says Nigeria has more than 4,500 registered pharmacies and more than 15,000 pharmacies; while Kenya has 6,000 registered pharmacies. So there is a lot of market share to capture. By next year, Field Intelligence plans to surpass Shelf Life’s 2,000 pharmacies and drug stores. By 2025, the company is targeting 12,000 pharmacies and drug stores.
Moreland said the company has multiplied by 5 in terms of Recurring revenue, adding that Shelf Life has sold more drugs and seen more patients in the past three months than in its first three years of business.
While Field Intelligence seeks to address inventory management with Shelf Life, Moreland believes the company is also effectively solving a financial problem because it provides an alternative to traditional financing options by reducing the cost of running a pharmacy.
“One of the great value propositions for us is that because we are selling on consignment, we free up a lot of working capital for the retailer.. So in the market, we are in general seen as a financial service provider and alternative form of financing for our pharmacies. Y believe is a big part of our story because when you compare the cost of joining Shelf Life to accessing the equivalent amount of working capital from microfinance or traditional bank, even concessionary lenders, we can be 60-80% cheaper with many more value-added services, ”he said.