Owens_MinorAfternoonSession

2007 OMI Investor Day

Investor Day 2007

W. Marshall SimpsonSVP, Sales & Marketing

Owens & Minor, Inc.


Working with Customers

• What resonates with customers?

• What are the expansion opportunities?

• What is our value proposition?


Working with Customers





Culture Matters in OurMarketplace

Partnership OpportunitiesPartnership Opportunities

Superior Customer ServiceSuperior Customer Service

DependabilityDependability

IntegrityIntegrity

Hospitals Place a Premium on:


• Nationwide Footprint – 45 distribution centers

• Workforce Quality & Longevity – teammate retention

• Significant Customer Relationships – 9 to 11 yrs.

• Legacy of 125 Years – unmatched expertise

Our Legacy = Advantages

* Last twelve months revenue as of 09/30/07


Expanding Relationships





Opportunity in Supply-ChainManagement Services

15%

15%

25%

45%

100%Total Cost Incurred by Hospitals*Percent

Supply Chain Management Expense

Labor OtherSupplies Logistics Total

*Figures are based on estimates of Healthcare Financial Management Association. Source: S&P Industry Surveys: HealthcareFacilities; Healthcare Financial Management Association; industry reporting; O&M Research analysis


Opportunity with Suppliers

Inventory Turns CreditsFill Rates Order Lead Time

Electronic Commerce Shipping MethodPayment Terms Shipments per Order

Drop Ships Advanced RebatesDispute Resolution Prepaid Freight


Data Visibility and Information Management• WisdomGoldSM

– Data Warehouse Links disparate information sources– WisdomGoldSM provides data cleansing and normalization

of Master File (“Gold” File)– Provides visibility into spend-data – Price parity becomes apparent– Standardization: product, supplier, channel, price/tier– Contract Management and Compliance– Improvement in pricing accuracy

Opportunity in Using Technology & Information Management Tools


Providing Supply ChainManagement Expertise• Buy/Sell

– O&M purchases product, manages inventory and delivers to healthcare facility

• Third Party Logistics (3PL)– Customer purchases product– O&M manages inventory– O&M delivers to healthcare facility

• Cross dock– Customer purchases product– Supplier sends to O&M– O&M delivers to healthcare facility

• Direct– Customer purchases product, suppliers send to healthcare facility


The Horizontal Distribution Difference

Manufacturer

VerticalManufacturer/Distributor

VerticalManufacturer/Distributor

HorizontalOwens & MinorHorizontal

Owens & Minor


What is our Value Proposition?





The Market Opportunity

Source: Frost & Sullivan; GHX and Company Estimates

OUR MARKETOUR MARKETOUR MARKET OUR MARKET

OPPORTUNITYOPPORTUNITY

$60+ Billion$60+ Billion$14 Billion$14 Billion


Continuum of Programs & ServicesImpenetrable Relationships

Bulk Med/Surg Distribution

WISDOMGoldSM

LUMConversion

Clinical Asset Management

Surgitrack

Clinical 3PL

DirectConversion

Cross-Dock

ConsolidatedServices

Clinical Utilization

Management

PRODUCT FOCUS PROCESS FOCUS


Customer Supply Chain Performance

DashboardTarget Medical Center

Supplies Expense PerTotal Operating Exp.

Supplies Expense PerEquivalent Inpatient Day

Supplies Expense perAdjusted discharge

Inventory Service Levels Satisfaction

““Move The Needle Together"Move The Needle Together"

• Supply chain management; from “dock to doc”

• Customer supply chainresource:

• Information• Tools• Project support• On-Going operations


Questions

Economy & Finance

Owens_MinorAfternoonSession