5 ways to drive maximum savings

with your freight management program

An educational event sponsored by OptiFreight

®

Logistics

Marc Mullen Vice President/General Manager, OptiFreight ® Logistics May 12, 2015 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

Marc Mullen

Vice President/General Manager OptiFreight

®

Logistics

2 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

Mike Walker

System Director, Centralized Purchasing

3 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

What we’ll reveal today

• • • Why close collaboration is essential to success 5 ways to drive

maximum

savings How to identify a strong freight management program 4 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

What is freight management?

Discounted rates Volume savings on shipping See your spend to save even more

5 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

The power of collaboration The stronger our

collaboration,

the greater your

success

6 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

Discounted rates are just the beginning

Discounted rates Managed Rate volume Continuous Savings Overall freight management value

7 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

The difference program participation makes

$39,678 Range of opportunity* compared to carrier list price

• No data exchange • Limited compliance • No outbound services • Only certified inbound volume and LTL

$107,034

• Participate in all service offerings: inbound, outbound • Participate in data exchange • Include a PO Comment for maximum program participation 8 *Based on internal OptiFreight ® Logistics data analysis – savings compared to list price. © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

Presence Health

$713,161 saved*

12-month results compared to carrier list price

9 *Based on Presence Health data -- list price comparison: April 2014 through March 2015. © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

5 ways to drive maximum savings

1 Supplier participation 4 5 2 3 Employee participation Mode optimization Large freight Advanced analytics

10 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

5 ways to drive maximum savings

Maximize supplier participation

• • • Provide freight history Include a PO Comment every time Communicate with suppliers 11 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

1. Maximize supplier participation

47%*

average savings per package • Share data with freight management program • Review every invoice over $50 • Pressure three ways: you, freight management program and GPO

Most suppliers aren’t going to pursue the savings for you!

12 *Presence Health saved an average of 47% per inbound package through OptiFreight® Logistics from January 1, 2014 to December 31, 2014. Individual customer savings may vary. © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

5 ways to drive maximum savings

Improve employee participation

• • Promote education Use an online portal 13 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

2. Improve employee participation

42%

average savings per package • Look at every single freight bill • Send employee “reminders” • Make it part of your culture 14 *Presence Health saved an average of 42% per outbound package through OptiFreight® Logistics from January 1, 2014 to December 31, 2014. Individual customer savings may vary. © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

5 ways to drive maximum savings

Increase mode optimization

• • How suppliers and employees can save you even more The key to mode optimization 15 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

3. Get in the zone and save even more

Next day delivery as overnight — but at ground service rates!

16 *Map is a representation of a transit map Ground Service area. Estimated delivery times may vary by individual supplier. © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

5 ways to drive maximum savings

Remember your large freight

• • • Save on capital improvements Save on new equipment More keys to savings 17 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

4. Remember your large freight

35%

average savings per shipment • Drive as much volume as possible • Focus on capital equipment • Pick up the phone 18 *Presence Health saved an average of 35% per large freight shipment through OptiFreight® Logistics from January 1, 2014 to December 31, 2014. Individual customer savings may vary. © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

5 ways to drive maximum savings

Use advanced analytics

• • • • Gain full visibility Benchmark performance Leverage Big Data Reveal the way to hidden savings 19 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

5 ways to drive maximum savings

1 Supplier participation 4 5 2 3 Employee participation Mode optimization Large freight Advanced analytics

20 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

“Must-haves” for your freight management program

21 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

“Must-haves” for your program

Program scale and reach Advanced data and analytics Healthcare industry expertise

22 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

Why OptiFreight

®

Logistics?

23 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

Making a real cost difference 21,000

active facilities*

2,000

healthcare providers*

$200 million

saved in 2014*

11.5 million

shipments* 24 Source: *Based on shipments through OptiFreight ® Individual savings may vary.

Logistics from January 1 through December 31, 2014. © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

Three ways we deliver

A comprehensive program Visibility and control Expertise and proactive support

25 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

OptiFreight ® Logistics: Program scale and reach

Full breadth of services across the continuum of care

Serving multiple customers Hospital Pharmacy Laboratory Surgery center Physician office Home Health Long-term care Blood and tissue bank Global Government Veterinary Academic Logistic solutions

(inbound and outbound) Small parcel Large freight International Hazardous White glove Home delivery Analytics/reporting Temperature sensitive 26 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

OptiFreight ® Logistics: Advanced data and analytics

Visibility and control

• Proprietary

data

analytics • Shipping service

trends

•

Benchmark

your program performance • Advanced

outbound shipping

tool •

Customized

program reporting 27 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

Expertise and proactive support

IT Customer care Vendor relations Implementation OptiFreight ® Logistics Analytics management Logistics solution Account managers

28 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

Q &

A Mike Walker, Presence Health

email: [email protected]

Marc Mullen, Cardinal Health

email: [email protected]

OptiFreight ® Logistics

phone: 866.457.4579 option 1 29 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.

Thank you!

30 © Copyright 2015, Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO, ESSENTIAL TO CARE and OPTIFREIGHT LOGISTICS are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.