More than 60% of adults went to see a dentist in 2019. That’s not counting 85% of children between the ages of two to 17 who sought oral dental services.
For any dental practice, such statistics point to the staid yet time-tested truth: Healthcare waits for no man. When you need to see the dentist, there is no substitute for a reliable professional.
Thus, the goal for dental firms is to optimize their front end to deliver the highest quality services. But many practices also understand the value of optimizing their back-end operations to care for their patients better.
Keep reading for a deep dive into four ways a well-structured dental procurement system can help you add value to your practice.
1. Cost Efficiency
When you are looking for your dental firm to level up its earning potential, the first area you’ll consider is cost reduction. For many dentists, the go-to method is to negotiate fair prices with suppliers.
While that is an excellent first step, it has its limitations. A supplier may give you a favorable price, which can deliver better cost-efficiency. However, over time your business turns its focus on other matters.
Inevitably, the cost benefits you negotiated begin evaporating through price creep. Other unit cost factors build up, and before you know it, your operational approach wipes out all the savings from the favorable supplier prices.
To avoid such a fate, you need to design and implement a procurement plan that touches on the people, the process, and pricing control.
The right dental procurement system can help your people learn how to follow best procurement practices. For example, one such guideline can be to shop several vendors and compare prices transparently to identify the best deal (you can learn here about that).
A valuable procurement system builds a culture where prices you receive from suppliers don’t keep changing. You can negotiate a favorable rate and keep an eye on it to avoid price creep.
If you leverage such a system, you’ll develop greater cost efficiency over time, which lifts your top line. And as the cherry on top of the cake, such a procurement system gives you a sustainable means to streamline your costs moving forward for future gains.
2. Process Efficiency
At the heart of it, procurement is about buying the right item, at the right price, at the right time. That may sound basic, but it’s surprising how hard dental firms struggle to deliver on this premise.
Your team may be responsible for procurement, but odds are they also handle other responsibilities day-to-day. It’s easy for details to slip under the radar with each order.
Additionally, the typical dental office procurement process is littered with a litany of emails, calls, and spreadsheets that reduce visibility. With such a system, it’s only a matter of time before things get out of hand.
For example, a dental firm may have $20,000 worth of implants in stock. Since the system does not place all the information within easy reach, such a practice may order more implants. By the time procurement realizes the error, thousands of dollars are tied up in inventory.
Deploying a standardized health care procurement system brings efficiency that raises visibility. You’ll manage your inventory better, which gives more life to your cash flow as money won’t be tied up needlessly in inventory.
3. Better Decision Making
With dental procurement, you can either look at what went wrong after the fact or take a preventative stance. In multi-location practices or larger-scale operations, things are more complex since you have to segregate duties.
Unless you have the proper decision-making approach, you’ll end up with a ‘post mortem culture’ where you’re learning from mistakes a lot. With a well-thought-out procurement system, you’ll be in the decision-making driving seat.
Instead of wondering what went wrong, you’ll have adequate data to uncover trends in your purchase process. Using these trends, you’ll be better placed to make the right decisions to increase the efficiency of your supply chain.
Another perk of a robust procurement system for your practice is that you’ll be able to make changes when they most matter. The earlier you can respond to dynamics in your supply chain, the better the outcome and the impact on your top line.
4. A Stronger Strategy
Procurement feeds into your overarching business strategy. As such, if you can develop and deploy a high-performing system, you’ll have a beneficial knock-on effect on your strategy.
For example, how well you can bring in the supplies directly influences the level of customer experience you offer. Faster inventory turnaround, for instance, helps you satisfy patients better.
Due to the remarkable service your patients keep receiving, they will likely recommend you to others. In no time, you’ll have more clients come in on the strength of a friend or family member’s referral.
As you shape your procurement to satisfy clients better, you develop a virtuous cycle that increases top-line revenue. But that’s not all.
Since your dental procurement is also running lean, your cost base is more efficient. Therefore, fewer costs are eating into the top line, making for a more lucrative bottom line.
All these efficiencies then give you room to introduce more services to differentiate yourself better. And the more effective your differentiation, the more clients you can bring in.
It’s incredible how much an exceptional procurement system can impact your other departments. For multi-location practices, a positive tweak in its group procurement leads to ripple effects across the chain that can help them build an effective competitive moat.
Whip Your Dental Procurement Into Shape to Improve Your Dental Practice
Even though the oral health market is going nowhere, it doesn’t mean you get to rest on your laurels. Your dental practice needs to tweak its front and back-end to give you an unassailable competitive advantage.
Thus, you should spend time assessing your procurement practice to uncover inefficiencies you can plug and capture gains that help you better serve patients. Patients tend to stick to an excellent dental professional for a long time.
Our website publishes health and business information to help you find ways to better your practice. Check out more of our content to discover how you can position your dental firm for long-term success.
