Supply Chain Challenges and Solutions: How Americares Keeps Moving

Q & A with: Kristin Norley, Americares Director of Supply Chain Management in conversation with Kate MacLachlan, Communications Associate

During the COVID Pandemic, the whole world seems to be talking about supply chain, from the Suez Canal to the holiday season. Are the current supply chain issues impacting Americares?

KN: We’re absolutely facing the challenges that everybody else is seeing and we’re creating solutions to get people the valuable medicines and medical supplies they need. Right now, it’s challenging to book sea container shipments going to our international partner clinics and hospitals. As a result, we are shifting more global shipments from sea to air – our air shipment volume is up about 25 percent – to get product to partners more quickly. Of course, everyone is shifting to air freight – we’re competing in a tight market.

What is the impact of the supply chain issues right now?

KN: We are doing our best to secure bookings and get our valuable shipments out, but, as a result of both the higher costs for sea shipments in this competitive market and the increased expense of air shipments, our shipping costs are up about 150 percent. We are also having to shift to different ports to find availability on ships, which adds trucking time and complicates logistics.  We have a team of logistics experts, most of whom have decades of experience in this area, helping us navigate this complex situation. We plan and manage about 8,000 shipments a year, and every shipment is critical — we know each shipment includes medicine or supplies that can be lifesaving.

How do you plan when the supply chain is so unstable?  

KN: It’s quite complex because we also must factor in each country’s requirement for the expiration date on medicine — that date is based on when the medicine or supply arrives in the country. I don’t think computer chips or children’s toys have that added complexity! So, we are adjusting our shipment planning. We have to build more buffers into our planning because some shipments are taking up to three months longer than usual.

So, say a country requires that all medicine entering the country have an expiration date at least 12 months in the future. We pack that shipment, but then we see that it could be stuck in a port for three months and not meet that 12-month dating requirement. We anticipate that, of course, and unpack that shipment and move to air freight or re-route the products to another hospital or clinic. We use our experience and knowledge to mitigate these extra steps, but we are juggling a lot right now.  We are committed to send only products our partners can use before the expiration dates. The team is working hard to make sure that we put all of the medicines and medical supplies, PPE —everything that we have — to good use by the health workers and health centers we support as COVID 19 continues its relentless global spread.

When we aren’t facing global supply chain issues during a Pandemic, what does a quality supply chain look like?

KN: We have a very disciplined supply chain process. It looks like this:

1. Donors – It starts with offers from our product donors—mostly medical product manufacturers and distributors. They can have very specific requirements about where we may or may not distribute product based on their internal requirements and how their business functions.
2. Vetting Donations – Then we look at the medicines being offered to make sure that they match our partners’ needs and capabilities. Everything we do in our supply chain is to serve our partners, so we know it’s important we get it right. For example, we work with many different types of health care partners and want to make sure the medicines offered aren’t too specialized for the clinics or hospitals they work with and the patients they serve. We also make sure the partners are allowed to import those specific medicines into the various countries. We look at the expiration dates on the medicines to make sure that they meet the local requirements. There’s a lot of vetting that happens upfront and it all starts with those constraints. We look at all those considerations before we even accept product from donors.
3. Processing Donations – When the product arrives in-house, we check quality and begin offering those products to our 4,000 partner health facilities. We share those proposals with the international partners to ensure they want and can use everything listed. Americares ships products only after recipient health care partners have reviewed every individual item, dosage, formulation and quantity to ensure appropriateness for their facilities and patients. Our U.S. partners and Medical Outreach partners order directly through online portals.
4. Shipping – Once international partners approve an order, we send it to our Logistics Team, which books a carrier to move the shipment for us. The order is then sent to our distribution center to pick and pack. Based on the destination country and how we ship it for the partner, Logistics completes all sorts of paperwork to ensure it meets customs requirements. There are a lot of pieces, and everybody works together.

Americares handles over $1 billion in donated medicine and medical supplies. What makes us uniquely qualified to provide international medical relief? 

KN: Our supply chain is one of our greatest strengths because we’ve built it over 40 years, maintaining relationships with shippers and airlines across the world. It’s at the core of our commitment to medicine security. And it’s essential to our work because supply chain allows us to provide medicine security for thousands of people. We have very disciplined processes that we follow and we hold ourselves to very high standards. At the same time, we’re sending shipments across the country and world – every route and destination country has its own requirements. The team is very flexible while adhering to strict standards and that enables us to process the volume that we do—about 8,000 shipments annually for health centers serving people who have little or no access to quality health care. Our staff is figuring out how to make things happen in a difficult and ever-changing environment. And the team is dedicated to meeting this challenge every day – saving lives and improving health for millions of people affected by poverty, disaster and inequity every year.

Learn more about Americares emergency response to COVID-19.