McKinsey January 24, 2025
With more efficient inventory management, medtechs can reduce inventory by up to 30 percent—freeing up cash and reducing write-offs.
Access to cash is critically important for medtech companies. Cash allows medtech leaders to acquire emerging technologies and develop their own new products, which in turn drives the kind of innovation that improves patient outcomes and boosts shareholder value. But many medtech organizations have too much of their cash tied up in excess inventory on shelves in too many locations. Typically, medtech companies hold as much as three times more inventory than companies in sectors such as consumer packaged goods and electronics (exhibit).
It’s not just about cash flow, though. Aside from tying up capital that could be deployed elsewhere, outdated...
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