As we all know, running a successful dental practice requires not just strong clinical skills, but also effective practice and people management. Hiring and training staff, marketing to new patients, and effective procurement are just some of the areas practice owners and managers have to juggle.
One often overlooked yet crucial aspect is supply purchasing, which can have a significant impact on the overall success of the practice. Below, we’ll explore why managing supply purchasing is important to practice success, and what areas you should be thinking about!
Why should I care?
We get it, you have a hundred things to think about and manage every day. Why should you be thinking about prices and availability of lidocaine and impression materials, current vs future prices, and what the practice across town is paying for the same items? Read on to find out!
Direct Costs ($)
Inefficient dental supply purchasing translates directly to unnecessary higher costs for practices. Without proper focus and the right approaches, practices can easily end up overpaying for supplies, missing out on volume-based discounts, and failing to recognize when your vendor rep’s quoted prices are no longer competitive - the infamous “price creep” as your supply costs rise just slowly enough that you don’t necessarily notice right away, but over time you end up paying a lot.
Indirect Costs (Time, Hassle)
Larger supply bills are the most obvious problem with an inefficient approach to supply purchasing. But it’s not the only problem, and arguably not even the biggest problem.
First, a manual and inefficient approach to supply purchasing can take up a significant amount of time and create hassles. Dentists and office staff may spend a lot of time searching for supplies, finding alternate options for back-ordered items, and dealing with multiple vendors with different purchasing processes and requirements. Not to mention tackling invoices one at a time, each of which has different terms and payment approaches. Time is a valuable resource, and more time spent on administrative hassles is less time spent on patient care, staff training, or any other activity. Hassles related to supply purchasing can also lead to unnecessary stress and lower job satisfaction among staff members.
Inefficient dental supply purchasing can also seriously disrupt a practice’s workflow and patient obligations. If necessary supplies are not on hand when needed, this can interrupt or delay patient treatment. Having to postpone patient visits due to items being on backorder from your primary vendor is a frustrating, challenging experience. Especially when other vendors may have the same item in stock and ready to ship, but doing the manual research to find that out and ordering in time is impractical. The practice now suffers from the double hit of delayed or potentially lost revenue, as well as hurting patient satisfaction and potentially the practice’s reputation.
Overall, inefficient supply purchasing can lead to a range of problems - sizeable bills, wasted time, disrupted practice workflow, and potentially compromised patient care. Dental practices need to prioritize efficient supply purchasing to mitigate these risks and improve practice health & financial success.
What to do about it
We’ve discussed the challenges that can come from an inefficient supply purchasing process, so now let’s explore the benefits of a great, efficient purchasing process. These are:
- Increased direct profitability through cost management (Hello, <5% of production!)
- Time and resource efficiency through staff responsibilities
- Higher job satisfaction and engagement of staff members
- Smooth and uninterrupted patient workflow and productivity
But how does a practice get there? Let’s talk about it.
Dental Inventory Management
An important first step to gaining control and efficiency is taking stock of what your practice has, what is used, and what’s needed. Are there boxes of unused supplies sitting in a forgotten corner of the supply closet? Do you purchase multiple different products that serve the same purpose? Do you always seem to run out of certain products?
Creating or refreshing inventory lists - with preferred brands and amounts - to be purchased weekly, biweekly, or monthly can go a long way to helping your practice better manage its inventory and purchasing.
Negotiation and Cost-Saving Techniques
So you’ve determined that the prices your rep is quoting you are high. The good news is that everything is negotiable - depending on your comfort with negotiation, practice purchasing volume, and relationship with vendor rep. It certainly can’t hurt to try.
Another option is to explore alternative suppliers. Most items dental practices purchase are not vendor exclusives - why not price-check other sources to see if your practice can get better pricing?
There’s always the option of pre-purchasing in bulk to drive volume discounts. This can help practice profitability but also limit monthly cash flow. It can also create storage hassles, as well as increase the risk of products expiring before they are used. Overall this can work, but it’s a tradeoff.
Approaches like exploring alternative suppliers, price comparisons, and bulk purchasing can help make a dent in supply costs. But with staffing difficulties being experienced by practices everywhere, let’s be honest that these aren’t easy responsibilities to add onto significant staff workloads.
Technology-Driven Centralized Purchasing
Working harder to improve supply purchasing and practice profitability can work, but working smarter is a lot easier. The dental industry is evolving rapidly to embrace some of the professional software tools that modernize business functions like purchasing.
Typical practices order from 5-8 different distributors and brands for their general and specialty products. Don’t make it someone’s (dreaded) job to create and update inventory lists manually, deal with many individual vendors, and try to keep costs under control while ensuring the practice gets the right products on time. Instead, consider using a professional ordering platform that centralizes all ordering and payments in a single place to boost your practice’s efficiency and profitability.
In addition, a centralized ordering platform helps you diversify suppliers and reduce risk. You shouldn’t be tied to a single vendor’s catalog, pricing, product availability, or responsiveness of the sales rep.
Use Torch to Boost Profitability
Efficient dental supply purchasing is a big contributor to practice success and profitability, and we at Torch are obsessed with this problem so that you don’t have to be.
With Torch, your practice can easily get preferred products at industry-leading prices, with all product ordering and payments done in one place. To learn more, check out how Garden City Dental Center saves 22% annually by using Torch.