Sam Holliman, who takes up the reins this year as Medequip’s Head of Procurement, was our first ever appointed buyer and has been with the business for 27 years. Here, Sam talks about the latest challenges faced by Medequip and how issues like recycling and Total Cost of Ownership are now dominating the agenda when it comes to planning for the future.
“With increasing pressures on customer budgets, over the past few years we have significantly shifted our focus in terms of developing strategies to work closely with our partners to identify and understand what the key factors influencing our markets are, and how we can continue to mitigate these.
“In order to provide services that are highly efficient from both a logistical and cost point of view, we have always focused on fast and effective turnaround of equipment, collecting, refurbishing and getting items back into stores ready for reuse.
Reducing scrap rates to recycle more effectively
“Our latest strategic project targets driving up recycling rates and reducing scrap, thereby reducing costs for our customers. As a procurement team, we’re working closely with Medequip depots and the supply chain across the country to achieve this.
As an example of progress to date, in 2023 we recycled 89% of returned products, the remainder being scrapped or used for parts. The reasons behind scrapping are many and varied – this can be due to equipment damage, cost of repair and availability of spare parts, amongst others.
As a result of our combined efforts over the last twelve months, by January 2025 we had successfully reduced our scrap rate by 26%. This reduction has a direct impact on customer budgets, as the credit value of recycled products generated goes straight back into their accounts. Our target is to now go even further and deliver another 10% reduction in 2025.
Calculating Total Cost of Ownership (TCO)
“High on the UK and European agenda is looking at the lifecycle of products and how we need to work with these products to optimise use. Considerations include assessing elements such as design to ascertain whether this is the most efficient for our business in terms of cleaning and installation.
“With the NHS targeting Net Zero within its supply chain by 2045, Medequip is aligning with those requirements as a key project for 2025. We’re looking to reduce Scope 3 emissions relating to products, and the current focus is on the most used products in six categories. Initial successes include the near-sourcing and redesign of a community bed to reduce transport emissions and cleaning and repair costs.
“Environmental, Social and Governance (ESG) considerations factor into our decisions too. As an example, foam products are our biggest contributor to Scope emissions, and we are looking at different methods of disposal such as refuse-derived fuels.
Teamwork in procurement
“Working within the Medux Group as part of a European procurement team, we collaborate closely to align strategies and synergies, which provides us with valuable additional knowledge and experience. Here in the UK, we continue to invest in our product management team to strengthen relationships with customers, understanding the challenges they face so we can continue to make the right contributions with our products and services.
“Into the future, we are increasingly working with leading organisations like the BHTA to exert a positive influence on equipment suppliers across every aspect of our changing requirements, from equipment design through TCO and the Internet of Things.
Equipment prices
“Despite UK CPI falling to 3%, down from notable highs of 11% two years ago, the supplier base continues to face pressures on production costs. All major employers, as we know all too well, are facing the challenge of NI contributions rising to 15% and thresholds reduced from April together with the increase in the minimum living wage. Other factors such as energy costs, spikes in freight rates and currency fluctuations meant that nearly all suppliers were forced to increase their equipment prices.
“However, Team Procurement delivered an average net increase to the customer estate of just 2.6%, well below the January 2025 RPI inflation rate of 3.6%. Given the current climate, we would view this as a positive outcome for both Medequip and our customers. Of course, our experienced team of Product Managers are always available to customers to review possible alternative stock items which may prove better financial value.”