Automated Supplies Keep Web Pharmacy Healthy

By John McCormick Print this article Print

A customized inventory management system helps this online pharmacy to tie together its inventory, warehouse and shipping processes to keep things functioning with a minimal headcount and very low costs.

Revenue Per Employee $15 million

RxUSA has its offices in a nondescript box of a building deep within an industrial park in New York's sprawling Long Island suburbs. The only hint of the company inside is a red, white and blue decal with the pharmacy's logo on the front door.

Upon entering, one stands in a small vestibule—there is no receptionist. In fact, few workers are anywhere to be seen in the facility, which houses offices, a full pharmacy, and a 6,000-square-foot warehouse in the back of the building.

But then, RxUSA employs a total of just 18 employees.

It's a small, bare-bones business—but it's booming.

RxUSA recorded sales of $209 million in the first six months of this year. For all of last year, the company posted sales of $276 million—a whopping $15 million in revenue per employee.

Not surprisingly, there's a bit of multitasking going on. For instance, chief executive officer Robert Drucker and his partner, executive vice president Mark Scovotti, who are both pharmacists, handle most of the company's incoming business—from answering customer phone calls to processing the 300 to 400 drug orders that come in each day. And the company's pharmacy director doubles as the warehouse supervisor.

But the key to the operation is a customized inventory management system from Xiacon, another small Long Island company. Running off an Oracle 9i database, the package, called IDwhere, helps RxUSA manage its warehouse, process shipments, and track pricing and sales with just a handful of people.

And that fits with the company's strategy, Drucker says, "[of] being able to apply state-of-the-art technology to problems. And using the technology to solve them rather than hiring another 10, 20, 50 people."

RxUSA runs an online retail pharmacy for consumers and a wholesale business that caters to hospitals, nursing homes, pharmacy cooperatives, government agencies and other institutions that dispense drugs. The company buys bulk pharmaceuticals from larger drug distributors that deal in brand-name and generic drugs. All of the drugs are shipped to the RxUSA facility on Long Island.

As cartons of drugs come into the building, the boxes' bar codes are scanned by workers using scanners from Symbol Technologies, and that data is fed to the IDwhere system. The bar codes usually contain the name of the drugmaker and the product in the container, but there is no uniformity among manufacturers.

This article was originally published on 2005-10-01
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