Friday 9th Dec 2016 - Logistics Manager

NHS Supply Chain saves £150m

NHS Supply Chain has reached its target of delivering £150 million in cash releasing savings back into the NHS by 31st March 2016.

NHSSC Hybrid TruckNHS Business Services is also targeting a further £150million savings from a two-year extension to its NHS Supply Chain service contract with DHL. The company are to reach the next stage of cash releasing savings by September 2018.

The contract was awarded to the logistics company in 2006 – originally worth £850 million over 10 years, it is now worth £1.6 billion.

“Identifying sustainable long term savings is fundamental to driving value for the NHS and by focusing on sustainable cash releasing savings means that not only do prices remain low but it prevents price hikes or supply shortages that could happen if prices were slashed to unsustainable levels,” said chair of the NHS Customer Board, Sir Ian Carruthers.

“NHS Supply Chain and the NHSBSA are currently continuing to work with the NHS to maintain momentum and to aggregate demand, rationalise and standardise their use of consumable products to deliver the next £150 million in cash releasing savings to achieve the £300 million overall target by September 2018.”

NHS Supply Chain has worked alongside the Department of Health, the NHS Business Services Authority, the NHS Customer Board, its suppliers and with trusts to reach its goal – this collaboration will continue in the next stage of savings.

The savings programmes include:

  • NHS Core List – achieving best value by reducing the range of like-for-like products that the NHS purchases
  • Compare and Save– allows trusts to review potential comparative product savings
  • DH Consumables Fund – Achieving price reductions on high usage product lines through national volume commitment
  • DH Capital Fund – Maximising savings through bulk purchasing deals on capital equipment
  • Price Ranking – At a glance price ranking sheets have been developed so that supplier pricing can be reviewed with ease
  • Stationery Core Range
  • Product Rationalisation – product range has been reduced from over 600,000 product lines down to 316,000 product lines.
  • Facilitating price decreases by Suppliers
  • The NHS Business Services Authority is targeting £150m savings from a two year extension to its NHS Supply Chain service contract with DHL.

“It has been a huge effort with many trusts and suppliers’ working hard to play their part in reaching this target and it’s important to remember that this process will only continue to drive significant savings if the commitment and support is continued by all parties,” said Carruthers.

“These savings are contributing to the savings that Lord Carter is looking to realise from the procurement of consumable medical products that are in NHS Supply Chain’s scope.”