INSIDE THE NUMBERS
Why supply chain is moving up the CFO agenda
The outcomes of supply chain transformation initiatives are well-documented. Across the country, health system CFOs are seeing these strategies translate into outsized financial results — from multimillion-dollar savings to reclaimed revenue streams that continue to compound year after year.
Annual cost reductions
NMHS | Mississippi
NMHS saw a great potential for eliminating redundant steps and improving stock by shifting to a self-distribution model.
Initially recording $14.5M of cost savings and increasing EBITDA by 10%, NMHS is sustaining $8M annually in supply chain cost reductions.
The ROI we prepared projected a five year payback, but the actual results will be just over two years."
Mike Switzer
Corporate Supply Chain Officer North Mississippi Health Services (NMHS)
Perioperative savings
Mercy | Missouri
Mercy sought to create a clinically integrated supply chain that aligns clinical workflows and supply chain operations.
Together, they optimized perioperative processes across 45 hospitals and 259 operating rooms, reducing waste, improving efficiency and enhancing patient care.
From a supply chain perspective, use of a technology-enabled process is critical as we solve for a challenged labor pool. The industry is really starting to catch up during a very pressured margin time."
Cheryl Matejka
Chief Financial Officer Mercy
The typical U.S. health system realizes an average of over $30 million in yearly savings when supply chain processes are fully integrated, from warehouse and pharmacy through to the point of care.
Average annual recurring savings
"We want the best outcome for the patient at the lowest possible cost [...] Placing great technology on top of old process is going to get you nowhere, and quite frankly, will probably buy you more problems."
Cheryl Matejka
Chief Financial Officer | Mercy
Why supply chain matters
- Converts waste into measurable savings
- Captures lost revenue streams
- Reduces working capital tied up in inventory
- Strengthens forecasting with real usage data
- Demonstrates enterprise ROI
In most health systems, coming in at an average of 30-40% of operating costs, supply chain is the second largest expense after labor. Yet it’s often the area with the greatest potential to find efficiencies and strengthen margins.
Hospitals waste an estimated $25.4 billion every year due to supply chain inefficiencies. Nearly 40% of healthcare providers have had to cancel or reschedule procedures because of product shortages, and 67% of supply chain leaders spend more than 10 hours a week managing inventory issues. These inefficiencies don’t just impact budgets, they affect patient care.
A fragmented, reactive supply chain is often the root cause. Without centralized oversight, health systems struggle with excess inventory, procurement challenges and logistical bottlenecks that drive up costs.
When managed strategically, it drives measurable returns in cost savings, revenue capture, and capital efficiency. Health systems that have invested in supply chain performance are realizing millions in sustained annual impact, with returns that continue to compound year after year.
Quantifying the ROI that health systems are realizing
Across the Tecsys network, supply chain investments are producing measurable returns that continue to build year after year. The numbers show just how material the impact can be:
Tecsys’ solutions touch and influence tens of billions of supply chain dollars annually.
On average, Tecsys solutions generate over $15 million in annual savings per customer.
Long-tenured customers continue to see value year after year, with some accounts achieving half a billion in lifetime supply chain gains.
Continuing the conversation
The financial impact of supply chain performance is clear — from millions in reclaimed revenue to measurable reductions in waste and working capital. These are consistent outcomes across leading health systems.
For a deeper look at how finance leaders are approaching supply chain as a driver of organizational health, visit our on-demand session:
Driving Financial Success in Healthcare: Insights from CFOs + Industry Experts
Who we serve
Trusted among the largest healthcare leaders in North America
What's next?
Health systems that elevate supply chain strategy are realizing consistent, measurable gains in savings, revenue capture and working capital. The financial rationale is clear, and the opportunity now is how to act on it. Whether you’re exploring ways to reduce inventory waste, strengthen margin resilience, or scale the impact of a centralized model, Tecsys can help you evaluate your options and map your supply chain transformation journey.
