PEORIA — OSF HealthCare's presence continues to grow in Peoria.
With plans already underway to renovate the former Chase Bank Building Downtown and the Cub Foods building on Knoxville Avenue, the faith-based organization that operates 12 hospitals in the state will soon supply those hospitals through a giant warehouse that OSF acquired when it purchased the former corporate headquarters of L.R. Nelson in 2017.
The 42-acre site built in 1994 by L.R. Nelson was sold to German-based Bosch Tool Co. in 2008. Fiskars Brands Inc. occupied the site next before moving to Wisconsin in 2016.
OSF has big plans to use space that once housed sprinklers and tools for the 1,500 different items that hospitals use on a regular basis, said Dennis Dracup, the facility's general manager.
Only a portion of the 270,000 square foot warehouse—big enough to contain six football fields—is used at present as OSF supplies hospitals in its western region, Galesburg, Monmouth and Kewanee, before phasing in service to all 12 facilities in Illinois. "It should be between eight to 10 weeks before we're up and running for the whole system," said John Horne, OSF's chief supply chain officer.
"We spent a year looking at other distribution centers around the country so we could adopt the best practices," he said.
Matt McGraw, VP of supply chain integration, noted that OSF is in rare company when it comes to handling supplies. "We're taking it to the next level. When it comes to distributing supplies, few hospital systems are doing this — less than 20 across the country," he said.
"We're blessed to have this space. The location is fantastic — right off the interstate so suppliers can get to us," said McGraw.
By stocking supplies in the warehouse, hospitals are freed from having to maintain their own storerooms. "That frees up space for patient care," he said.
Horne added space is also allocated for items that need special care. Along with warehousing everyday needs like gowns, gloves and paper towels, the center also provides a cool room for supplies such as IV solutions that are temperature-sensitive, he said.
Plans also call for a secure 'building within a building' this summer when OSF will add pharmaceutical supplies to its warehouse offerings, said Horne, who cited a number of reasons for the warehousing effort.
"It not only saves money but it's more efficient. We're able to buy in bulk, taking advantage of discounts and rebates, savings that are passed on to to the hospitals to reduce costs," he said.
By operating its own supply center, OSF also looks to avoid periodic shortages that can occur, said Horne.
While some 250 people work in offices at the site, the warehouse employs about 30 people, he said. "Some people came over from the warehouse we operate in East Peoria while others were new hires," said Horne.
OSF operates four trucks to ship supplies around the state, he said.
Dracup said efforts have also been made to make sure "what we're shipping is right." "Everything is scanned based on dimensions so we can put it where it has to be," he said.
"We put the most popular items at eye-level where employees can readily access them," said Dracup, noting Mario Mirandola, the warehouse manager, "is always looking at product usage."
The warehouse, sparkling clean and kept at a uniform 71 degrees, is open from 6 a.m. to 6:30 p.m., Monday through Friday, said Dracup, adding the capability for a second shift is there if needed.
"Seventy-five percent of orders will be shipped the same day. The other 25 percent will go out the following day," he said.
Joe Lockwood has only been on the job for four weeks but embraces the computer technology used in the warehouse, brandishing a handheld scanner that indicates not just the hospital a supply is going to but the specific department.
Steve Tarter covers city and county government for the Journal Star. He can be reached at 686-3260 or firstname.lastname@example.org. Follow him at Twitter@SteveTarter and facebook.com/tartersource.