One of our Client is trying to understand the Pharma Distribution in India. They are trying to understand
• Audits on the dealers/ distributors to check their inventories etc. What is the kind of effort required in these audits? Are they done on sampling basis or for everybody? What is the level of automation for this?
• What are the exact regulations that govern the maintenance of inventories? On a broad basis how is the min inventory/ safety stock determined for these?
• How does the sales force forecast demand for medicines etc? Do they take information from dealers? Is inventory maintained determined as per the demand forecasts?
• What are the behavioural aspects which prevent distributors from wanting to adopt electronic modes of payment?
• Why do pharmaceutical companies take packing credit? Since they are immensely cash positive, do they still require it? Can this be replaced by documentary credit such as LC with much lower finance costs?
Request for dealers:
• What is the credit period within which the retailers pay you?
• What are the challenges that you face with making electronic payments?
• What kind of systems do you use to maintain inventory, place orders, manage accounts etc?
• How often does the pharma company audit your inventory and what kind of demand/ inventory data do you provide the pharma company?
• How do you estimate your demand and calculate minimum inventory required?
• What are the financing solutions that you currently use? Do any pharmaceutical companies provide financing options for you?
• Do you face any challenges when dealing with pharmaceutical companies such as long lead time for deliveries?
