Thu, Nov 06, 2014 - Page 13 News List

MedFirst mulls second logistics center to serve increasing number of stores

By Camaron Kao  /  Staff reporter, in Taoyuan County

MedFirst Healthcare Services Inc workers package items for shipment at a warehouse in Yangmei City, Taoyuan County, yesterday.

Photo: CNA

MedFirst Healthcare Services Inc (杏一), which operates healthcare stores with medical consultancy services, yesterday said that it is considering building a second logistics center in Taiwan next year to accommodate its growing number of shops.

The proposed logistics center would likely be similar in size to the existing one in Yangmei City (楊梅), Taoyuan County, which was opened in February last year and can serve 230 to 240 stores, MedFirst president Jimmy Tsai (蔡德忠) told reporters yesterday.

A leading operator of healthcare supply stores in the nation, the company has 179 outlets and nine shopping centers, Tsai said, adding that it plans to open at least 98 more shops.

“We have to start building a new logistics center before the one we have reaches its maximum capacity,” he said.

MedFirst also provides logistics services for other companies, he added.

It invested about NT$380 million (US$12.42 million) in the Yangmei logistics center, which took between one and 1.5 years to build.

Now, the company is looking for a plot of land of about 3,300 ping (10,909m2) in Taoyuan on which to build the second center, which it expects will lower costs and increase efficiency in the long term, Tsai said.

The logistics center in Yangmei enables stores to receive items they need to restock within 24 hours, down from the 72 hours it took to do so in the past, MedFirst assistant vice president Jesse Wei (魏子文) said, adding that the company aims to further reduce that time to less than a day next year.

“Before the center was built, sales on Mondays and Tuesdays were always low, because logistics companies in Taiwan do not distribute goods during weekends,” Wei said.

The company’s online warehouse management system informs the logistics center when a store’s inventory levels fall below a set threshold and also collects sales information for every outlet, with the data used to forecast future sales and distribute necessary items to shops in a timely manner, Wei said.

“The system helps inexperienced store owners order accurate amounts of inventory for their store,” he said.

In addition, the system provides shop owners with immediate information about what the company has in the warehouse in Yangmei, he added.

There are 40 to 42 employees in the center, which distributed NT$120 million worth of goods to all of MedFirst’s stores each month since December last year.

The loading process used at the center has increased the accuracy of loading to 99.8 percent, up from about 98 percent previously, Wei said.

However, the rate was still lower than the 99.9 percent achieved by global logistics companies, he added.

In the past three quarters, MedFirst posted revenue of NT$2.64 billion, up 6 percent from NT$2.49 billion the previous year, according to the company’s filing with the Taiwan Stock Exchange.

MedFirst’s seven stores and two shopping centers in China generated revenue of 13.14 million yuan (US$2.15 million) over the past three quarters, up 17 percent from the previous year, it said.

“Sales at retail shops in China are dropping amid the rise of online shopping,” Tsai said, adding that the company suffered less from the trend because it also offers consultancy services.

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