Consignment Inventory Optimization at Ethicon, a Johnson & Johnson franchise

The global economic slowdown and the current low growth period has forced companies to reduce their costs wherever they could. As one of the world's largest pharmaceutical, consumer product and medical device manufacturer, Johnson & Johnson follows a strategy that allows them to maintain reasonable prices while facing higher costs. Storage cost and Inventory management are some of them. This paper will focus on consignment stock and has two aims : the first one is to create a tool that will give stock visibility at a client level (to see where the inefficiencies are) and the second on is to optimize the inventory levels at the customer's facilities. The tool and the analysis of this paper have shown that there are many opportunities in different EMEA countries such as in Italy where a potential consignment stock (for Ethicon Endo-Surgery products) reduction of XX.X% can be made by optimizing stock management.