The Kenyan economy has been plummeting in the recent past and businesses have been struggling to make profits in various sectors.
However, the pharmaceutical industry has a chance to go around the hard economic past thanks to the entry of Shelf Life. The company, which acts as an intermediary between the supplier and the local pharmacy, takes in all the risks that are brought about by the terrible economic climate currently experienced in the country.
Working with Field Intelligence, a software company, Shelf Life does research about the market and makes the decision of which drugs to put on the shelves to avoid losses. In an interview with Business Today, Field Intelligence CEO Michael Moreland said that pharmacies that have agreed to partner with Shelf Life have already reaped off the benefits of it.
“The challenges that the Kenyan economy has had have made Shelf Life a really great entrant to the market because we take that risk off the entrepreneur. We are also investing new cash into the system and it stays in the system,” Moreland noted.
Acting as the supplier of drugs to pharmacies, Shelf Life also provides financing to the pharmacies that lack funds to bring in new stock. The company supplies the stock for free and lets the pharmacy pay once they have made the sale of the stock provided. Unlike other loans, Shelf Life’s financing does not have any interests attached to it.
“When you subscribe to the Shelf Life service, we give you the stock at no cost which is similar to giving you money. The pharmacy will only pay back once they have sold all the products supplied,” Shelf Life lead pharmacist, Ajiffa Victor Labor, told Business Today.
However, before Shelf Life supports any local pharmacy, they would have to look at the legitimacy of the business. The credit score of the directors or the top executives of the business is also looked into.
The company itself was first started in Nigeria and has been in the West African country for about 4 years now. According to Moreland, Field Intelligence CEO, Shelf Life debuted in Nigeria when the country’s economy was in recession. Moreland believes that Shelf Life can help pharmacies which are facing the hard economic times make a profit.
Taking in The Risk
Having the tools to predict and manage risks, Shelf Life also acts as a risk-insulator for local pharmacies. The company knows the amount of product needed in the market at a specific time and therefore avoids loss of value in items due to expiry.
“We manage the entirety of the supply chain. We do all the procurement and logistics. We own the stock until its sold so we keep all the inventory risks. If something expires we take that loss,” Moreland explained.
Pharmacies who take in stock on credit will only pay for the goods that are sold. If ant products expire before they are sold by the local pharmacy, then Shelf Life will also take in that risk. A software developed by Field Intelligence helps Shelf Life manage the losses incurred and avoid risks too.
When asked if the same software can be used in other industries in Kenya, Moreland said they have thought about it but it’s not likely to happen anytime soon.
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