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FedEx, Cardinal Health expand strategic 3PL alliance

By Jeff Berman, Group News Editor
October 31, 2013

FedEx and healthcare services provider Cardinal Health said this week they have established a strategic alliance that they said will allow them to leverage their capabilities to provide 3PL services.

The companies said this collaboration will provide myriad benefits for shippers, including:
-access to extensive global transportation networks, including the world’s largest cargo airline;
-delivery options that include direct-to-patient services and delivery to specific departments in the hospital;
-significant regulatory experience in the healthcare industry;
-access to facilities throughout the world - many located near hospitals, business centers and other strategic locations;
-a single point of contact for supply chain and transportation needs; and
-inventory and transportation visibility across the networks

Through their relationship, which goes back ten years, FedEx and Cardinal Health provide access to more than 40 warehouses and U.S.-based distribution facilities.

“As the new healthcare environment evolves to demand greater value from all stakeholders, logistics providers have a unique opportunity to help healthcare companies derive new sources of value from their supply chains,” a FedEx spokeperson told LM. “Both of our companies have strong existing capabilities, but looking at how markets are evolving, FedEx and Cardinal Health came to the conclusion that we can provide a more competitive offering together than it made sense for either company to build on its own. With the global transportation and logistics capabilities of FedEx and the healthcare expertise of Cardinal Health, we can leverage our respective market-leading capabilities to deliver premier logistics solutions for healthcare suppliers and providers.  Our two companies have been working together for over 10 years, so this collaboration was a natural next step in our relationship.”

Cardinal Health Vice President of Integrated Logistics Rob Doone said that this strategic alliance is simply the next phase of the relationship between the two companies, adding that with both companies already established experts in their own fields, they believe they can focus on their own strengths to continue to improve and expand services.

“Historically, we had a relationship that was focused on transportation,” said Doone. “Now, we are pulling the physical infrastructure into the fold, providing customers greater access to two proven networks.”

In the ten years the companies have collaborated, FedEx and Cardinal Health have worked together to offer both off-the-shelf and customized solutions to meet customers’ requirements and now serve more than 200 customers.

Examples of these services include: a broad U.S. network, with more than 40 medical and surgical distribution facilities and 2 pharmaceutical facilities in North America; vast industry expertise with dedicated healthcare-specific 3PL that offers exceptional knowledge and service based on significant experience in the industry; dedicated regulatory and compliance experts with the ability to consult on a wide range of regulatory issues, including pedigree, licensing, advocacy, and accreditation; recall management support and management of unreleased and quarantined products; expertise in customs clearance and global supply chain management; delivery options include direct-to-patient services and delivery to specific departments in the hospital; end-to-end visibility comprised of inventory and transportation visibility across the networks, shipment tracking and tracing, and event monitoring services; global access to an established network of transportation facilities, global & regional distribution centers, and stocking locations around the world—many located near hospitals, business centers and other strategic locations; and value-added capabilities and regulated services such as repackaging and kitting.

When asked to provide an example of how this alliance can benefit shippers, Cardinal Health’s Doone used an example of a manufacturer of medical device products and the challenge it faces to optimally deploy its inventory to avoid stockouts and ensure customer satisfaction while keeping costs down.

“Through this alliance, we can now optimally deploy inventory – in centralized global distribution centers or at any of the 39 licensed and registered Cardinal Health med/surg distribution centers around the country,” he said These centers are strategically located to ensure markets are reached quickly while keeping overall transportation costs low. This puts the customer that much closer to the customer and makes operations that much more efficient. This alliance is all about leveraging the transportation and logistics capabilities of FedEx and the healthcare expertise and specialized facilities of Cardinal Health, to create tailor-made supply chain solutions for our healthcare customers. We’re bringing the capabilities of both to bear, and we believe we can deliver new and unique solutions to market.”

About the Author

Jeff Berman headshot
Jeff Berman
Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).


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