Inventory Management Practices in Private Healthcare Facilities in Nairobi County

Abstract

U niversal health coverage (UHC) is an integral part of the United Nations sustainable development goals. The private sector plays a prominent role in achieving UHC, being the primary source of essential medicines for many people. However, many private healthcare facilities in low-and middle-income countries (LMICs) have insufficient stocks of essential medicines. Simultaneously, these same facilities carry excessive quantities of other drugs, leading to obsolescence. This suggests poor inventory control. To propose potential remedies it is vital to fully understand the underlying causes. In semistructured interviews with managers of private healthcare facilities in Nairobi, we asked them about their (1) inventory control systems, (2) inventory control skills, (3) time/human resource constraints, (4) budget constraints, (5) motivations for inventory control, and (6) suppliers. Our results suggest that the problems are driven by resource limitations (budget and time/human resources), managerial issues (relating to skills and systems), and market mechanisms that limit overage and underage costs. Unavailability at the supplier level and motivations for inventory control are relatively minor issues. We posit that the key causes are interlinked and stem from wider issues in the market and regulatory environment. Our results challenge prevalent beliefs about medicine supply chains in LMICs and lead to novel hypotheses. Testing these hypotheses could improve our understanding of inventory management in private healthcare facilities and aid progress in achieving UHC.

How much do customer ordering practices drive medical supplies distribution (in)efficiency for primary care markets?

“…Periodic automatic review practices such as these, where a target inventory level is set, inventory is checked regularly, and orders are placed at uniform intervals, are widely accepted due to the ease of use and have largely been ignored in terms of cost and service‐level impact. While research on this topic has been relatively scant, past research has suggested that such widespread practices create significant supply and demand mismatches (Karamshetty et al., 2022).…”

Inventory management and TQM practices for better firm performance: a systematic and bibliometric review

“…Furthermore, due to variations in distribution charges and bill payment periods, firms that regularly manage their inventory may face significant inventory expenditures (Yu and Cheng, 2014). Karamshetty et al (2022) concluded that inventory-related problems often occur due to resource limitations, managerial issues and market mechanisms. Addressing this issue is also an essential part of IM.…”

“…The current issue and full text archive of this journal is available on Emerald Insight at: https://www.emerald.com/insight/1754-2731.htm implement all the practices due to budget constrain Karamshetty et al (2022). Hence, there is a need for trade-off between practices and budget constraints for efficient use of resources.…”

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“…Karamshetty et al. (2022) offer a detailed description of the often informal way in which inventory decisions are made at a selection of healthcare facilities in Nairobi.…”

“…One survey respondent cautioned, based on a study in Nairobi, that software systems for inventory control may be counterproductive in developing countries, as simple manual or intuition-based systems may be more suitable in settings with small scale, low IT literacy, and high staff turnover. Karamshetty et al (2022) offer a detailed description of the often informal way in which inventory decisions are made at a selection of healthcare facilities in Nairobi.…”