Chair of Logistics and Quantitative Methods

New Collaboration: Inventory Management Policies for Kenyan Pharmacies


The Chair of Logistics and Quantitative Methods collaborates with Kenyan-based startup MaishaMeds and GIZ (Deutsche Gesellschaft für Internationale Zusammenarbeit) to develop innovative inventory management policies for Kenyan pharmacies.

African woman in a pharmacy (CC BY-NC-ND 2.0, AG)

Strengthening Kenya’s backbone of medical supplies

Kenya’s pharmacies are the primary point of care for many illnesses and provide people with a brought range of important medicines. Partly funded by GIZ (Deutsche Gesellschaft für Internationale Zusammenarbeit) MaishaMeds, a Kenyan-based startup, seeks to improve pharmacies’ management and patient care by providing an Android-based ERP software (more). The software, for example, allows a pharmacist to track the transaction history, enables the pharmacist to follow-up with patients via an SMS service, and allows him to reorder medications based on forecasts and to track supplies.

Simple data-driven inventory management policies can help pharmacists

Currently, pharmacists order from suppliers without any sophisticated analytical support. Also, they do not systematically collaborate with other pharmacies to bundle orders in order to achieve better prices and lower their logistics cost. This may result in unnecessarily high purchasing costs, shortages of important medicines and/or obsolete inventory.

Researchers at the Chair of Logistics and Quantitative Methods support MaishaMeds and the Kenyan pharmacies by developing forecast-driven inventory and ordering policies that allow pharmacists to set optimal inventory levels and to coordinate their purchasing activities.

The team employs data-driven techniques not only to improve inventory management of an individual pharmacy. The researchers’ objective is to use innovative methods to consolidate purchasing volumes of individual pharmacies and provide recommendations for when pharmacies should team-up and leverage economies of scale in procurement and logistics.

Results will increase access to a broad range of medicines in rural areas

The researchers expect that the novel inventory policies and the use of innovative data-driven methods increase the availability of important medicines and lower the operating costs of the respective pharmacies. This will help pharmacists provide the right medicines to customers – especially in rural regions that are more difficult to reach. Also it will help the pharmacies, to make better use of their (oftentimes) constrained working capital.

Von Alexander Rothkopf