Donors are investing in integrating local private sector resources into public health supply chains. VillageReach’s Outsourced Transport Resource Center aims to put the theory of outsourced supply chain logistics into practice.
No one wants to reinvent the wheel. Especially with the goal of universal health coverage by 2030, the global health community needs tested solutions that work.
VillageReach has been working with technical, donor, and private sector partners to develop sustainable outsourced logistics solutions in Mozambique for over seven years. For us, leveraging local and regional private sector resources is critical for building high-performing supply chains that are equitable, people-centered, resilient, and sustainable.
Now that we have a tested solution that works, VillageReach launched the Outsourced Transport Resource Center, or OTRC, in 2022, with the ultimate goal of turning the theory of outsourced supply chain logistics into practice across Africa.
A global consensus
Coming out of the COVID-19 pandemic, global health funders are increasingly investing in solutions that integrate local private sector resources into public health supply chains. In 2021, the U.S. Agency for International Development committed 25% of its funding to local organizations by 2025. Large donors such as USAID’s NextGen Global Health Supply Chain and the Global Fund to Fight AIDS, Tuberculosis and Malaria are focusing new funding on using the private sector to strengthen local supply chain systems, specifically encouraging the increased use of outsourced logistics providers for transportation and warehousing.
The reason donors are focusing on funding outsourced supply chain logistics is because we know that it works. In Nigeria, a successful intervention used the private sector to transport laboratory samples, which increased samples tested. In the Democratic Republic of Congo, an outsourced transport solution using private sector drone operators successfully increased the availability of health products among hard-to-reach provinces with significant geographic barriers. And in Zambia, a successful intervention used outsourced logistics providers to distribute life-saving medicines.
In this environment of an increased global focus on outsourced logistics and a growing evidence base for its success, OTRC is well placed to offer governments, implementers, and private sector partners technical assistance to move from ideas to implementation.
Catalyzing outsourced logistics
OTRC is built upon our experiences and lessons learned around outsourcing supply chain logistics. Through pilot programs and working with various partners, we overcame several challenges in Mozambique. But today, with support of private sector and donor partners, the Last Mile Supply Chain program delivers medicines and vaccines to all health facilities across the country using private sector transportation firms. To ensure this program is sustainable in getting products to people, VillageReach is also actively transitioning the complete management of outsourced distribution to the Mozambique government. This will enhance the overall effectiveness of the distribution system and strengthen the government’s capacity.
How did we get here? That is what OTRC was developed to answer. It offers public and private sector stakeholders support, tools, coaching, and training to implement outsourced logistics solutions for public health supply chains. OTRC services have value for countries wanting to start a new outsourced logistics solution, as well as for countries already implementing one.
Learning from our lessons
OTRC has developed an online resource library that not only offers technical notes outlining lessons learned from working in Mozambique, but also includes tools and information from partners such as the Africa Resource Center’s outsourcing toolkit, and USAID’s approach to outsourcing transportation and warehousing. OTRC-authored technical notes — available in Portuguese, French, and English — offer lessons and recommendations on topics such as health commodity integration, applying a cost management approach, and using a multisupplier strategy for successful outsourced logistics.
OTRC provides countries collaborative services to conduct landscaping on private sector logistics opportunities, as well as understanding stakeholder perceptions — which is key to developing sustainable solutions. OTRC will then analyze the survey results and offer country recommendations based on perceptions related to topics such as the government’s readiness to implement an outsourced solution, as well as the private sector’s willingness to work with the government.
Technical assistance for sustainable solutions
OTRC can offer a range of technical assistance on topics such as outsourcing strategy and capacity development, both among governments and their technical partners, as well as private sector transporters, as well as direct support with outsourced logistics implementation. This includes:
• Contracting fourth-party and third-party logistics firms.
• Signing service level agreements.
• Solution costing and budgeting.
• Managing solution performance.
• Sustaining and scaling the solution through transition of ownership to government.
OTRC also offers expertise in using drones for health product transport. We believe in an integrated approach to outsourced transport that supports multimodal transport solutions that are fit-for-purpose. This means considering the weight, size, and temperature sensitivity of health products being transported, geographical barriers that may restrict certain vehicles, and any time constraints to avoid product spoilage. OTRC has used this approach in the Democratic Republic of Congo, Malawi, and Mozambique, using drones for routine and on-demand deliveries.
Outsourced logistics solutions contribute to strengthening public health supply chains — and ultimately ensuring health products are available when and where they are needed. These solutions increase access to health care for the most under-reached communities, the timely delivery of health products, and the cost-effectiveness of a country’s distribution system.
Without consistent access to health products, people do not receive the health care they deserve, and outsourced solutions that engage local and regional private sector firms in Africa offer a clear path to ensuring everyone has the health care needed to thrive.
Work with OTRC to make the implementation of outsourced logistics solutions a reality in your country. Contact firstname.lastname@example.org.