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If you're like most dental practice owners, you're probably spending between $30,000 and $50,000 annually on supplies per location. That's a significant chunk of your overhead—money that could be going toward new equipment, staff bonuses, or your bottom line.
What you may not realize is while you're comparing prices between two or three suppliers, large DSOs are leveraging their size to negotiate 20-30% discounts on those same products.
But what if you could access similar savings without selling your practice?
This is the driver behind why independent practices join Group Purchasing Organizations (GPOs).
Think of a GPO as your practice's professional negotiating team.
For around $150-300 per month, you gain access to the collective buying power of hundreds or even thousands of practices. Instead of negotiating alone, you're part of a group that can demand better prices, terms, and service from suppliers.
But what you should know: not all GPOs are created equal.
The difference between a GPO that delivers real savings and one that just makes promises comes down to three critical components.
Your GPO needs relationships with reliable distributors who can deliver products on time, every time. The biggest discount in the world means nothing if ordering becomes a hassle or deliveries are inconsistent. You need partners who integrate with your ordering systems and maintain consistent inventory levels.
A good GPO doesn't promise savings. They prove it. When considering multiple GPOs, you should ask for data showing how much their members actually purchase to negotiate effectively with manufacturers. Empty promises of "3,000 potential customers" don't move the needle with manufacturers. Hard purchase data does.
This is where most GPOs fall short, and it's why many dentists give up on them. Without technology to guide your purchasing decisions and track compliance, you're essentially trying to remember which products have the best negotiated prices while juggling multiple supplier websites and catalogs.
To illustrate this point, let’s walk through an example scenario.
Your GPO negotiated a fantastic deal on prophy paste that’s 30% below your current price.
But when your office manager goes to order supplies, she defaults to the familiar brand from your usual supplier because she doesn't know about the savings opportunity.
Multiply this by dozens of products and hundreds of practices, and you see the problem.
Moreover, manufacturers will quickly realize the GPO can't actually shift purchasing behavior, and those negotiated discounts disappear.
A technology-enabled GPO solves this by:
When technology, distribution, and negotiation work together, something powerful happens:
This creates what industry insiders call "defensive positioning"—manufacturers offer their best prices not hoping to gain business, but because they're afraid to lose it.
Many practice owners feel caught between a rock and a hard place.
Stay independent and struggle with rising costs, or join a DSO and lose control of your practice.
GPOs offer a third option:
GPO advantages:
The investment:
The return:
The price of membership for GPO each year is most likely less than your monthly coffee budget.
What that allows, however, is accessing the same purchasing power as practices 100 times your size.
This could add up to thousands of dollars from supply costs to growth initiatives and allow you to compete with DSOs on cost while maintaining your autonomy.
Looking to explore GPO options? Browse Method's vetted GPO partners in our Partnership directory and start saving today.
June 26, 2025
Every DSO leader and practice owner knows the frustration: despite setting clear supply budgets, individual locations consistently overspend, order duplicate items, or let inventory pile up while cash flow suffers.
The problem isn't your budget numbers, however. Once your organization has scaled to a certain point, a lack of systems to enforce and optimize spend is completely necessary.
Here's how forward-thinking DSOs are making their once chaotic procurement process into a competitive advantage.
Too many DSOs set supply budgets based on ideal scenarios rather than production reality. When budgets are unrealistic, teams either ignore them entirely or constantly request exceptions.
Benchmark your budgets against actual production levels.
A healthy DSO typically runs 4-6% of collections on supplies, with top performers hitting closer to 4%.
But here's the game-changer: give your teams real-time visibility into budget performance. When office managers can see exactly where they stand against their monthly allocation before submitting orders, they make smarter decisions automatically.
As the old saying goes, “what gets measured gets managed”, but people forget the second part: you’ve got to be measuring the right things. In this case, measurement has to happen before the money is spent, not after.
Most DSOs try to build formularies by requesting order history from multiple suppliers. The results are incomplete data, missing invoices, and formulary decisions based on partial information.
Implement procurement technology that captures every transaction across all suppliers for 3-6 months before making major formulary decisions. This gives your clinical team complete visibility into actual usage patterns, not just what suppliers choose to report.
Real-time reporting also allows you to refine your formulary continuously. When you spot a location consistently ordering off-formulary items, you can quickly determine if it's a training issue or if the formulary needs updating.
Asking teams to build carts on supplier websites for approval or manage spreadsheets takes focus away from patient care and higher-value tasks.
Automated approval routing where requests flow directly to designated approvers with all context included—pricing comparisons, budget impact, formulary compliance status.
This creates essential checks and balances without administrative burden. Your teams can request what they need while you maintain spending control and prevent over-ordering before money leaves your account.
Teams manually check multiple suppliers for the same items, often missing better pricing or simply ordering from whichever site they remember.
Procurement platforms that aggregate real-time pricing and automatically build optimized carts based on your lowest available prices. With a few clicks, staff can confidently order knowing they're getting the best deals from your preferred suppliers.
This isn't just about saving money—it's about eliminating the time waste of price shopping and the frustration of discovering better pricing after orders are placed.
Excess inventory sitting on shelves ties up capital and often expires before use. But stockouts disrupt patient care and force expensive rush orders.
What you should be doing instead
Implement inventory management systems with visual scanning, reorder tagging, or check-in/check-out processes. Train teams to maintain 2-4 weeks of supply for high-turnover items and 6-8 weeks for specialty items.
The key is having systems that make inventory tracking effortless, not another admin thing to do. When checking stock levels is as simple as scanning a barcode, teams naturally order more precisely.
The bottom line is you need to control procurement processes before they control you.
What separates a successful DSO from a struggling one is how well they’re managing their supply spend and inventory.
While your competitors are still playing spreadsheet games and hoping for the best, you could be:
The practices implementing these systems then reinvest those savings into growth, technology, and better patient experiences.
June 20, 2025
Poor procurement planning can significantly impact your dental practice's profitability.
With national dental expenditures reaching $174 billion in 2023, implementing effective supply management strategies is crucial for maintaining healthy profit margins between 30-40% .
A strategic, seasonal approach to procurement planning can optimize your practice's operations and protect your bottom line.
Based on over a dozen conversations, here is our suggestion to make that happen at your organization.
Daily operations are always going to demand attention to address immediate needs. Having regular, monthly reviews provide the first level of strategic insight into your practice's supply management.
Successful procurement requires consistent monthly oversight of key metrics:
Your analysis should go beyond just total spend. Look for any inconsistencies with previously established baselines and budgeted amounts, including:
Keeping an eye on suppliers helps identify patterns in delivery reliability or product quality that might otherwise go unnoticed.
Supply needs can fluctuate depending on when your busy seasons are. If you don’t already have par levels set for your inventory, this is a great opportunity to start tracking that.
Quarterly reviews provide opportunities for deeper analysis and strategic adjustments. According to Bain & Company research, approximately 25% of business leaders’ time is spent on business unit reviews, making it essential to maximize the value of these sessions.
As your practice moves through the year, each quarter brings distinct procurement priorities.
The fourth quarter focuses heavily on budget planning for the coming year, contract evaluations, and major equipment decisions. Tax implications and timing of large purchases deserve particular attention during this period.
The first quarter centers on implementing new vendor agreements and rolling out updated formularies. This is also the ideal time to establish baseline metrics that will guide procurement decisions throughout the year.
Mid-year reviews in the second quarter should examine price drift and compliance metrics while assessing the success of new initiatives.
The third quarter begins the critical data-gathering phase for next year's planning while optimizing current inventory and maintenance schedules.
Modern procurement platforms have transformed seasonal planning from a manual, time-consuming process into a dynamic, data-driven operation.
Real-time budget tracking and automated inventory management alerts help practices stay ahead of potential issues rather than reacting to them. Price comparison tools and custom reporting capabilities provide unprecedented visibility into spending patterns and opportunities for optimization.
Successful procurement planning balances standardization with flexibility. While core formularies provide consistency and leverage buying power, location-specific needs and emergency purchases must be accommodated.
Regular supplier reviews maintain accountability while strengthening valuable partnerships. Price variation monitoring and private label optimization contribute significantly to cost control without compromising quality.
Automated monitoring, regular review schedules, and clear performance metrics form the backbone of effective procurement management.
Platforms like Method make it easy to centralize purchasing, automate tracking, and provide custom reporting capabilities that transform raw data into actionable insights.
Effective procurement planning requires consistent attention and strategic thinking. By implementing these seasonal planning strategies and leveraging modern technology solutions, your practice can optimize spending, improve efficiency, and maintain healthy profit margins.
The shift toward data-driven procurement management is fast becoming essential for practices aiming to maintain competitiveness and profitability in an increasingly complex market.
Consider scheduling time with one of our procurement experts to identify opportunities for improvement and optimization in your practice's supply management approach.
June 12, 2025
If there's one operational headache that plagues nearly every dental practice—regardless of practice size—it's inventory management.
Between tracking hundreds of products, preventing stockouts, and avoiding tying up capital in excess supplies, inventory management presents a daily challenge for dental teams.
Here's the silver lining: these inventory challenges can be solved with proven methodologies.
After working with thousands of dental professionals across the country, we've identified three proven approaches to dental inventory management that can transform this persistent pain point into a streamlined process.
There's no one-size-fits-all solution for dental practices. The best approach depends on your practice's specific needs, physical layout, and operational preferences. Fortunately, figuring out the right approach transforms inventory from a burdensome chore into a smooth, almost effortless process.
Here are three proven methods to consider:
This approach represents the simplest upgrade from traditional manual processes. It maintains the intuitive nature of visual inspection while eliminating inefficient steps.
How it works:
Perfect for:
Why it works: This method eliminates the frustrating process of writing down items and then searching for them in your ordering system. The entire process happens in one step – see it, scan it, done.
For many practices, this simple change can cut inventory management time in half.
This method introduces structure and consistency through physical reorder point indicators and a simple tag-based workflow.
How it works:
Perfect for:
Why it works: This system creates a visual trigger point that takes the guesswork out of when to order. By calculating proper reorder points (Average Daily Usage × Lead Time + Safety Stock), you ensure you're ordering at precisely the right time – not too early, not too late. The physical tag serves as an unmistakable signal that action is needed.
This comprehensive approach combines technology and process to create a fully integrated inventory system with real-time tracking and analytics.
How it works:
Perfect for:
Why it works: This method creates complete visibility into your inventory at all times. You'll know exactly what you have, where it is, and what it's worth. The system does the thinking for you, automatically identifying what needs to be ordered based on actual usage patterns rather than guesswork.
Many practices find that combining elements of different inventory methods works best. Here are some popular hybrid approaches:
Transforming your inventory management doesn't happen overnight, but even small improvements can deliver significant benefits.
One practice we worked with reduced their inventory value by 20% while eliminating stockouts completely, all by implementing the reorder tag system for their top 50 products.
The key is selecting an approach that aligns with your practice's specific needs and workflow. With the right system in place, inventory management transforms from a persistent headache into a streamlined process that supports practice efficiency and profitability.
While these methods can be implemented independently, having expert guidance and the right materials can make the transition significantly smoother. In addition to our software platform, Method specializes provides everything practices need to successfully implement any of these three systems:
Ready to transform your dental practice's inventory management? Contact our team today to discuss which solution is right for you!
June 5, 2025
Every dental practice faces the same critical balancing act: maintaining adequate supplies to deliver excellent patient care while avoiding the financial drain of expired products and overstocking.
Based on conversations with other industry leaders, we’ve found that dental practices lacking proper inventory controls commonly lose around 10-15% of their supply costs to expired products and overstock situations.
For growing practices and DSOs, these losses compound across multiple locations, creating a significant drain on profitability that could be reinvested in practice growth or technology improvements.
This only a waste of resources goes beyond just time, money, and supplies. It also creates operational inefficiencies that can compromise quality patient care.
In this article, we'll examine five proven strategies to optimize your inventory management without compromising patient care, helping you reduce waste while maintaining the high standards your practice demands.
While expired products and overstock situations represent obvious financial losses, poor inventory management creates deeper operational costs:
If these issues sound familiar, your practice is likely losing significant revenue through inefficient inventory management. Watch for these red flags:
The foundation of effective inventory management is establishing accurate par levels. In other words, the minimum and maximum quantities you should keep on hand. Many practices rely on gut feeling or historical ordering patterns, leading to either stockouts or excess inventory.
Start by tracking actual usage data for each product category over several months. This baseline helps you:
Remember: par levels are not static. They must be regularly reviewed and adjusted based on changing practice needs, patient volume, and procedure mix. For instance, if you have an influx of patients for back to school cleanings, your needs for prophy paste are going to be a lot different than slower times of the year.
One of the biggest mistakes practices make is attempting wholesale changes to their inventory system all at once. That’s a quick way to have staff push back or make changes that aren’t well liked.
Instead, take a measured approach:
This approach allows you to refine your processes while maintaining staff confidence and ensuring patient care isn't disrupted.
Private label products should absolutely be a consideration when considering supply costs. Top-performing DSOs aim for a private label usage of 30 to 40% of their total spend.
In many cases, private label products are literally the exact same product as the branded version to the point of being produced in the same facility.
While these products have huge cost saving potential, the transition requires careful evaluation:
Remember that not all private label products are created equal. Some offer premium quality at lower costs, while others may compromise clinical outcomes. Always prioritize patient care in these decisions.
Nothing wastes money faster than expired products.
If your supply closet is packed with teetering boxes or supplies are scattered around your office wherever they can fit, it’s time to make a change. Implement a systematic approach to expiration date management:
This system should include clear protocols for handling near-expiration products and procedures for rotating stock between locations if applicable.
Inventory management isn't a rotisserie oven. You can’t "set it and forget it". Much like your par levels, create an overall, regular review cycle that includes:
This ongoing review helps identify emerging issues before they become costly problems and ensures your inventory system evolves with your practice needs.
Taking control of your inventory starts with implementing systematic oversight. Procurement platforms can provide the tools needed to track usage patterns, manage expiration dates, and optimize ordering patterns automatically.
Inventory management excellence isn't about having the lowest possible stock levels. That’s just playing with fire. Instead, focus on maintaining optimal levels that support clinical excellence while minimizing waste and inefficiency.
You want the right products, in the right quantities, at the right time, without tying up excessive capital in unused inventory.
Ready to stop losing money to poor inventory management? Implementing these strategies with the support of modern procurement technology can help you achieve both cost efficiency and clinical excellence. Method can help you do just that.
May 29, 2025
Every dentist has a supplier they swear by.
In fact, studies show that 85% of dentists report strong brand loyalty to their suppliers, citing trust in quality and consistent service as key factors. Yet many procurement platforms present an unnecessary (unsaid) ultimatum:
"Switch to our preferred suppliers or forget about significant savings."
This approach ignores the reality of dental practice operations. Forcing supplier changes costs practices between $5,000 to $10,000 per transition, which, in most cases, will effectively negate the promised savings.
Our position: You shouldn't have to abandon trusted relationships to control costs.
Method's supplier-agnostic approach eliminates this false choice. We empower you to work with your preferred suppliers while uncovering optimization opportunities you never knew existed.
In this article, we’ll explore why forced switching is a subpar approach, and instead, you should be finding ways to work more intelligently with partners who already understand your practice.
Constantly switching suppliers isn't necessarily a cost-saving silver bullet that some procurement platforms make it out to be. In fact, it often creates a cascade of hidden expenses that can quickly eat away at any savings you might achieve.
Think about the administrative nightmare alone. Every time you switch suppliers, your team needs to:
But the real costs run much deeper than administrative headaches.
When you're constantly chasing the lowest price by hopping between suppliers, you lose something invaluable: consistency.
Your long-time supplier knows exactly which composite to send as soon as you say, 'I need A2 composite capsules. They understand your practice’s specialty and connect you with the right products and manufacturers.They know whether you're managing your supply spend within a monthly budget. That institutional knowledge disappears the moment you switch to another vendor chasing a $5 discount on impression materials.
Another thing other platforms won't tell you: they limit your view of the total marketplace. By restricting which suppliers you can see and work with, these systems create an artificial scarcity that prevents you from understanding true competitive pricing. Imagine trying to gauge real estate values by only looking at three houses in town.
When you can't see the full marketplace, you can't make truly informed decisions about where the best value actually lies.
That includes the value of maintaining relationships with suppliers who have proven themselves reliable partners in your practice's success.
Strategic partnerships with suppliers can make or break your practice's efficiency and profitability.
Consider what happens when you need a Maryland bridge cement on a Friday afternoon for a Monday morning case.
With a strong friendship with an established supplier, they’ll move mountains to make it happen because they understand that your success directly impacts theirs. They'll expedite shipping or waive rush fees. We’ve even heard of some hand-delivering critical items when needed and possible.
That’s just one situation, however. The best supplier relationships provide ongoing value that extends far beyond the transaction:
Your trusted sales rep can alert you when new products launch, recommend cost-effective alternatives to expensive name brands, and help you navigate product recalls or discontinuations before they impact patient care.
When equipment fails or products don't perform as expected, having a direct line to knowledgeable support staff who understand your practice's specific needs is invaluable. No waiting on hold for generic customer service representatives who've never set foot in a dental office.
Many suppliers offer continuing education credits, expedited equipment service, service discounts, software licenses, or practice management consulting as part of long-term partnerships. These perks, while not always reflected in product pricing, can represent thousands of dollars in annual value.
Remember: supplier diversity strengthens your practice.
While single-sourcing might seem simpler, working with 2-3 primary suppliers creates healthy competition while maintaining strong relationships. This approach provides redundancy for critical supplies and gives you negotiating leverage based on established trust and proven purchasing patterns.
The most successful dental practices don't just maintain supplier relationships—they actively leverage them for mutual benefit. Here's how to transform your supplier partnerships into competitive advantages:
Establish 2-3 primary vendors to prioritize purchasing decisions and create clear benchmarks for price negotiations. When suppliers know they're designated partners, they're more motivated to provide exceptional service and competitive pricing.
Use pricing intelligence during supplier conversations. Instead of accepting quoted prices at face value, approach negotiations with:
"We’ve seen some more competitive pricing elsewhere, but we’d really like to keep the business with you—any chance you can work with us on the price?"
Quickly evaluate savings potential when your trusted rep suggests less expensive alternatives that deliver similar clinical outcomes, making informed switches within existing relationships.
Regular monitoring helps identify opportunities for spend avoidance, like preventing unnecessary purchases or optimizing order quantities before they impact your bottom line.
Ensure you receive proper credit for damaged items, short shipments, and price adjustments through comprehensive reporting, protecting margins while demonstrating to suppliers that you're a sophisticated customer.
Here's where Method fundamentally differs from other procurement platforms: we believe your choice of suppliers should remain exactly that: your choice.
Being truly supplier-agnostic means we integrate with your existing vendors without requiring you to switch or add new ones. Whether you've worked with Schein, Patterson, Benco, or Darby for decades or prefer more regionalized full-service suppliers, Method adapts to your established relationships rather than forcing you to adapt to ours.
Our platform provides real-time pricing transparency across all your preferred suppliers simultaneously. You get a dashboard that shows you not just what you're paying for dental composites from your primary supplier, but what every supplier in your network is charging for the same products.
To reiterate, this visibility doesn't force you to switch, but you can be empowered to make informed, real-time decisions.
Our platform also analyzes your purchasing patterns and spending data to identify optimization opportunities while respecting your supplier preferences. Instead of automatically redirecting orders to our "preferred vendors," we arm you with competitive intelligence.
For example, if analysis shows you're paying 15% above market rate for certain endodontic supplies, we provide the data you need to negotiate better pricing with your trusted supplier—or to make an informed decision that the premium is worth it for the relationship value your practice receives.
No software tool should dictate who your practice does business with. Period.
We’re not talking about data points to be optimized away by an algorithm here.
Supplier relationships represent years of trust, personal connections, and mutual understanding.
That’s why Method's supplier-agnostic philosophy is built on this fundamental truth: technology should expand your options, not restrict them.
We believe that procurement platforms should adapt to your practice's established relationships, not force your practice to adapt to some platform's preferred vendor list.
May 27, 2025
Every dental practice owner knows the sting of rising supply costs.
But these changes don’t happen overnight. Price creep is often due to gradual, often imperceptible rise in procurement costs.
While the individual price increases may be tiny, they can drain tens of thousands of dollars from your practice annually (and most practices don't even notice it happening). Industry data shows that practices commonly experience 10-20% cost increases through price creep alone, separate from market-driven price changes.
The challenge is particularly acute for growing practices and DSOs, where manual procurement processes make it nearly impossible to track these incremental changes across multiple locations and suppliers. Without systematic oversight, these hidden costs compound rapidly, directly impacting your bottom line.
In this article, we’ll examine how manual procurement creates hidden costs across your practice operations and, more importantly, outlines the concrete steps needed to regain control of your supply spending.
Price creep is the gradual, often unnoticed increase in supply costs over time. One supplier might increase an item's cost by 50 cents one month, then another dollar the next.
These are small changes, small enough to fly under the radar. But when you multiply those changes across hundreds of SKUs? Those changes add up and this problem compounds with multiple locations. Without centralized procurement, each practice location might pay different prices for identical items.
Price creep has a particularly insidious effect on dental practices using manual procurement processes. For instance, when practices rely on individual supplier websites or credit card purchasing, they lose the ability to track price changes across the board.
Manual systems also mask pricing inconsistencies between negotiated rates and actual charges. Even when practices secure favorable contract pricing, individual location logins may not reflect these negotiated rates. Without automated verification, practices often overpay simply because they lack visibility into what they should be paying versus what they're being charged.
Credit card purchasing further obscures these issues by eliminating the opportunity to review prices before payment. When practices automatically pay invoices via stored credit cards, they surrender the leverage to dispute incorrect pricing or negotiate better terms.
By the time you notice the price increase, you've already paid for it and getting that money back is nearly impossible.
Manual procurement creates financial losses across multiple areas:
Tracking price increases is crucial, but manual procurement creates deeper operational costs that can significantly impact a practice's profitability.
The most immediate effect is on staff productivity.
We’re talking about the dental assistants and office managers who spend hours managing supplies instead of focusing on patient care and practice growth. Unfortunately, when procurement is your dental assistant's eighth job in the practice, something has to give.
Perhaps most significantly, manual procurement creates a cycle of reactive purchasing that prevents practices from building strong supplier relationships or negotiating better contracts. Practices can lose revenue through these operational inefficiencies alone, separate from direct price creep impacts.
If this represents even 3-5%, it could mean tens of thousands of dollars annually for an average practice, money that could be reinvested in growth, technology, or improved patient care.
If you're not sure whether or not you’re overspending on supplies, there are a few places to look within the practice.
First, if your practice relies primarily on credit card purchasing and lacks a formal purchase order system, you're likely missing opportunities to verify pricing and leverage better payment terms.
One of the biggest issues is that some practices don't have any inventory controls in place at all. You need to know what you have so you can actually make an informed decision about what to order.
Another red flag is the inability to easily compare supplier pricing or track price changes over time. Without centralized procurement data, practices often miss gradual price increases until they've already significantly impacted profitability. Additionally, if your practice lacks formal approval processes for purchases, you're exposed to both inefficient spending and potential security risks.
Taking control of procurement costs starts with establishing baseline data about your current spending patterns. This means implementing a system to track what you're buying, from whom, and at what price.
The next crucial step is implementing a purchase order system that allows for price verification before payment. This gives your practice leverage to dispute incorrect pricing and negotiate better terms. Regular price audits should become part of your standard operating procedure, allowing you to catch price creep before it significantly impacts your bottom line.
Consider consolidating suppliers to optimize your buying power while maintaining enough vendor relationships to ensure competitive pricing. We recommend working with 2-4 suppliers. That is enough to maintain competitive pricing but not so many that it creates administrative burden.
As you’ve seen, price creep's impact on dental practices extends far beyond simple cost increases. Fortunately, this issue isn't inevitable.
Modern e-procurement platforms like Method provide the systematic oversight needed to catch and prevent these hidden costs. By centralizing your procurement data, implementing automated price verification, and establishing proper inventory controls, you can transform procurement from a source of financial drain into a strategic advantage for your practice.
Ready to stop losing money to price creep? Schedule a demo with Method today to see how our platform can help you regain control of your supply costs and protect your practice's profitability.
May 15, 2025
Save, Invest, and Grow
“Compound interest is the eighth wonder of the world,” Albert Einstein once said, “he who understands it, earns it; he who doesn't, pays it.”
The same principle applies to your dental practice. You want to make your hard-earned dollars work for you.
Cutting costs is the first step, but the real value comes when you reinvest those savings to help your dental practice grow. For instance, if you can save $50,000, reinvest it into your dental practice, you could go on to generate $1 million in additional revenue for your practice.
How exactly to save that $50,000? In this article, we’ll outline how to cut unnecessary costs and exactly where to reinvest that extra cash in people, training, and systems to generate more revenue for your dental practice.
For Dentists, saving $1 is the same as earning $2.92.
Why?
Because money saved is money directly available. When you spend time working to increase production, the cash on hand is delayed. It often takes one to three months before you receive it.
That’s why saving and investing that money now is so powerful. It gets you on your growth path now, not later. When you cut spend from your budget, you now have that cash on hand, rather than having it go back out the door for some expense or another.
The question is, how quickly can you save money? If it takes too long to realize your savings, it’s hard to invest that money into something that could benefit your team right away.
Dental supplies typically account for 6-7% of a dental practice’s overhead. Reducing that by even 1% can free up thousands of dollars. A lot of the dental practices use software to help them order and manage the costs of dental supplies.
Dental practice owners using Method, a dental procurement software, can reduce their supply costs to the 4-5% range, instantly saving them 2-3% annually. You can cut supply costs without cutting corners. You can get high quality supplies at fair prices by using a marketplace that showcases all the most affordable prices for your supplies.
We recently spoke with Managing Partner Austin Moffat from DSO CFO, an advisory group for dental practices. Here’s how they put it, “Supplies should be around 6-7% of overhead, and even a 1% savings can make a significant difference. The bigger you get, the harder it is to maintain EBITDA. You have to focus on what you can control.”
The best way to control your dental supply spend is monitoring it with a dental procurement software like Method. But there’s only so much you can cut before it affects patient care and team morale.
“Cutting costs is easier than driving revenue…” the advisor went on to say, “but at some point, you can’t cut costs anymore. The real question isn’t how much you can save, it’s what you can do with the money you free up.”
Remember what Einstein said: it’s not about earning money right now. It’s about earning exponentially more money later. You can invest your savings in your practice in any of these three areas: your people, training, or systems to see that exponential growth in your firm. If you have a lot of cash on hand, you can invest in all three.
According to DSO CFO, they follow this mantra: Right people, right training, and right systems.
Take this real-life example of a dental practice that was a DSO CFO client.
This dental practice wanted to generate more than $5 million per year. They were doing well but couldn’t figure out how to break past that barrier. The practice had three doctors and multiple hygienists. Their team was well built, but they didn’t know what was missing. When DSO CFO looked into it, they found that the three doctors met their production goals. But none of the hygienists hit their targets.
When discussing this with the partners of the practice, they suggested they invest in training the hygienist on how to hit their production goals without sacrificing patient care quality. To invest in this training, the dental practice had to find ways to cut costs, save money, and reinvest it into their staff. By following the suggestion of DSO CFO, this dental practice could be on its way to making $6+ million a year.
So can you.
Ultimately it comes down to investing your savings in people, training, and systems.
You can’t run a practice without your team. They need you. You need them. Especially if you have hopes of growing beyond the average $1 million per year practice earnings. Few practices get there without investing in their people.
With 1-2% of revenue freed up, that’s $100,000 for the $5M practice, they could:
A well-trained office manager alone can drive $1M+ in additional revenue by optimizing scheduling, team efficiency, and collections.
People will always be your greatest asset as a dental practice. If you invest more into them, they'll produce more for you. Use your savings to invest in your people and they’ll make it worth your while.
A lack of training is one of the biggest hidden costs in a dental practice.
Let’s say you run a $3.5 million practice and invest $20,000 in advanced training for your hygienists and front office staff. If that training helps increase efficiency and reduces cancellations by just 5%, you could add an extra $150,000-$200,000 in revenue over the next year.
Key training areas to focus on:
Training is often overlooked but offers some of the highest returns in a dental practice. By improving the skillset of your staff, you increase revenue potential. In other words, the more knowledgeable your team, the more efficient and profitable your practice becomes.
If your practice grows from $1.5M to $4M+, you can’t afford to run operations the same way you did before. Without the right systems in place, patient care declines, billing errors increase, and growth slows down.
Many practices struggle with this because they want to balance standardization and autonomy of staff to care for patients how they please. However, the solution is simple. Separate business operations from clinical decisions. They're not the same. They're very, very different. You can't run a business as a clinician or you risk losing out on money now and in the future. You can't run your practice like a business or you risk losing that personal touch your patients have come to love.
Meanwhile, allow your doctors autonomy in patient care and clinical decisions. This balance ensures efficiency without sacrificing quality.
The purpose of savings is to reinvest them into long-term growth. Don’t just save for savings sake. Save for a purpose. Every dollar you free up should be directed to areas that generate more revenue for your dental practice such as people, training, and systems.
Done correctly, a $50,000 savings can help your dental practice generate an additional $1 million in revenue. Turn your pennies into millions by investing them back into your dental practice.
If you don’t know where to start to see savings like this, don’t worry. Method and DSO CFO can help you out.
You can learn more about DSO CFO and what they offer by visiting their website dsocfo.com
May 9, 2025
You and your team work hard for every dollar your dental practice brings in.
Yet, at the end of each month, you might be left asking the question:
Where is the money?
We can’t tell you where your money is. But we have a good idea. Here’s what usually happens:
Your employees who could have been scheduling appointments, educating patients, or managing the practice are burned out from insurance-related tasks.
Then, when claims are finally submitted, many get denied or delayed due to small errors, such as a missing attachment or an incorrect code. Claims pile up, cash flow stalls, and the money you've earned sits out of reach.
This cycle isn’t sustainable, but it’s the reality for many dental practices. You’re able to get by fine, but you're not laying a foundation for scaling your practice. If you want your practice to generate seven figures consistently, then you need to invest in better systems. In this article, we will discuss where your money is and how to get it.
A large portion of revenue sits in collections. If your collection rate is below 98%, money is being left on the table. When your practice grows, whether by adding new patients or new locations, it becomes nearly impossible to keep up with insurance claims, verifications, and payments internally. You're caught in a constant battle to stay ahead of these tasks.
Jenny Fetty, Vice President of Dental Sales at Medusind, a national leader in dental billing & RCM solutions, sees this every day: "The biggest pain point we see is practices trying to grow without the infrastructure to support their revenue cycle. Their staff ends up overwhelmed, and collections inevitably suffer."
Your employees likely aren’t revenue-cycle experts, and hiring specialized staff to handle billing internally can become too expensive depending on the size of your practice. This inefficiency shows up clearly in industry benchmarks:
You’ve worked hard for your money. It’s important to have a system in place to collect as much of it as possible.
Revenue cycle management (RCM) is crucial for dental practices aiming to maintain steady cash flow, minimize denials, and increase overall profitability. Effective RCM involves several best practices:
Instituting these practices helps dental offices significantly boost their net collection rates, typically reaching upwards of 98%, and creates a predictable, reliable cash flow. This improves the dental practice evaluation.
As Jenny from Medusind notes:
"When practices partner with us, their staff can refocus on patient care. We handle the complexities of the insurance cycle, freeing your team from hours on the phone each day."
Medusind supports dental practices by providing specialized teams dedicated to managing complex insurance tasks, including eligibility verification, claim submissions, payment posting, denial management, credentialing, and diligent follow-ups. Leveraging dedicated experts ensures that these RCM best practices become seamlessly integrated into daily operations, achieving measurable financial improvement without burdening your internal staff.
This is one of a few places your money is hiding. But it’s not the only place. One of the other areas your money hides is in your dental supplies. You may be paying too much for them over time, and by doing that, your net earnings decrease. Not good.
You want every dollar to be accounted for. You also want to maximize the EBITDA your dental practice achieves.
By centralizing and simplifying revenue management processes, your practice stops leaking cash. A portion of your collected dollars can now be reinvested into patient care, advanced equipment, marketing, staff training, or expanding locations.
At the end of the day, your practice valuation is up to you and how you manage your funds. You can create processes that help you manage your funds so that every dollar billed is collected and managed. With the right systems in place, your team can focus on what matters most: delivering exceptional care and growing a practice built to last.
To see if you can increase cash collected, reach out to our partners at Medusind. They can help with Revenue Cycle Management and get you more cash in your dental practice's pockets. The more money you collect, and as your costs decrease, your EBITDA increases and so too does your practice's value.
May 6, 2025
Procurement in the dental industry is at a crossroads.
For many practice owners, they don’t think they need to label “buying supplies” with a term like procurement.
That’s just a formal label, best relegated to the white collar business world.
Unfortunately, this mindset has led to significant waste in dental practices across the country. While practices focus intensely on patient care, scheduling efficiency, and revenue optimization, they often overlook the systematic management of their supply chain.
The result? Expired products sitting on shelves, inconsistent pricing across locations, missed volume discounts, and hours spent reconciling invoices that could have been automated.
The good news is that modern procurement solutions have evolved to match the unique needs of dental practices. They're no longer the complex, enterprise-only systems of the past.
Procurement platforms made specifically for dental practices can help both single-location practices and large DSOs alike take control of their spending while maintaining the flexibility needed in a clinical environment.
You’ve got to find the right balance and that’s exactly what we’ll cover in this blog.
On the balance, dental practices—particularly single-location operations—have historically approached procurement with minimal formal processes. A credit card, a trusted staff member, and a collection of supplier relationships might seem sufficient. However, this approach carries hidden costs that impact both operations and profitability.
Price creep represents one of the most insidious effects of under-managed procurement. When practices lack systematic monitoring of their spending patterns, suppliers can (and likely will) gradually increase prices without detection.
These small increases may add up to perhaps just cents on individual items. However, much like the plot of Superman III, these tiny amounts can accumulate to significant amounts across thousands of transactions. Some practices experience double-digit percentage increases in costs simply because they lack visibility into their spending patterns.
Security concerns also arise with informal procurement processes. Consider many cautionary tales in business where a staff member uses the company credit card for personal purchases.
Without proper controls and oversight, such incidents can go undetected until significant damage is done.
Overall, under-management often leads to missed opportunities for cost savings. When practices don't have clear visibility into their spending patterns, they can't effectively negotiate with suppliers or identify opportunities to consolidate purchases.
They might be paying premium prices for items available at significant discounts through alternative suppliers or private label options.
On the opposite end of the spectrum, some practices (especially growing DSOs) fall into the trap of implementing too many procurement solutions. This often results in a sort of process overload where staff members must juggle multiple systems, passwords, and myriad multi-step processes just to complete basic purchasing tasks.
Consider the front desk staff member who needs to open five or six different websites just to manage basic procurement tasks. This complexity not only slows down operations but also increases the likelihood of errors and staff frustration.
When processes become too complicated, staff members might seek workarounds, defeating the purpose of having robust systems in place.
Over-complexity can also manifest in supplier relationships. While having multiple suppliers can provide competitive advantages, managing more than four suppliers often creates diminishing returns.
The administrative burden of processing multiple invoices, managing various delivery schedules, and reconciling different payment terms can outweigh any cost savings from split purchasing.
Several indicators can suggest your procurement strategy has veered toward either extreme:
Under-management warning signs
Over-complexity warning signs
Finding the right balance for your practice starts with an honest assessment of your current state.
Your goal shouldn’t be to eliminate all complexity. That’s not only impossible but some level of structure is necessary for effective procurement management.
Rather, aim for systems and processes that provide meaningful control and visibility while supporting efficient operations. This balance typically includes several key elements:
1. Streamlined approval processes
Implement workflows that automate routine purchases while maintaining oversight for significant expenditures. For example, orders under $500 from approved suppliers might proceed automatically if within budget, while larger purchases require specific approvals.
2. Formulary management
Maintain a clear, well-organized formulary that balances standardization with flexibility.
This might include:
3. Supplier relationships
Work with two to four primary suppliers to maintain competitive pricing while keeping administrative overhead manageable. Having a multi-vendor approach provides leverage for negotiations while avoiding the complexity of managing too many vendor relationships.
4. Data-driven decision making
Implement systems that provide clear visibility into spending patterns without creating information overload. Focus on key metrics such as:
Successful procurement lies in finding solutions that enhance rather than complicate your practice's operations.
For many practices, this means implementing a single, comprehensive procurement platform that can:
Smart practices are discovering that the right platform can transform procurement from a necessary evil into a strategic advantage.
Method offers dental practices a comprehensive yet intuitive solution to procurement. After all, dental practices have enough on their plate without yet another software to use. Our simple, intuitive platform allows your staff access to the information they need, when they need it—all without a steep learning curve.
May 1, 2025
The success of your dental practice or DSO hinges on one balancing act: meeting immediate needs while also planning for future growth.
Focus too much on the short term? You’ll either lose out on potential for growth or ignore long-simmering problems. Too much focus on the long-term means you can potentially stumble over roadblocks with cash flow and hitting production numbers week by week, month by month.
Finding this equilibrium is crucial for sustained success as one study by McKinsey found that this leads to results like:
The principles of balancing short-term goals and long-term growth apply across the spectrum of dental practices, from solo practitioners to large DSOs. Regardless of size, every dental business faces the challenge of meeting immediate needs while planning for future expansion.
In this post, we'll explore practical strategies to help you navigate the challenges of balancing short-term goals with long-term growth aspirations.
The first step in balancing short-term and long-term objectives is taking a look at how your daily operations are running and seeing how they align with your overall strategic vision.
SMART goals are a great tool for this. This means setting goals that are:
For example, you might set a short-term goal of increasing hygiene production by 10% in the next quarter, while also planning for a 5% overall growth in the coming year. These goals should be integrated into a detailed business plan that clearly connects daily tasks to long-term growth objectives.
Implement systems to track progress and measure important KPIs for your practice.
An e-procurement platform to track and analyze your supply costs against production on a monthly basis. These systems can also help track compliance with both vendors and internal practices on a monthly basis. Regular monitoring ensures that negotiated terms are being honored and that your team is adhering to established procurement protocols.
During regular team meetings, you can reinforce the connection between these KPIs, daily work, and future growth. Monthly staff meetings, meanwhile, can give you more data to review and see how you’re pacing versus annual objectives.
This not only keeps everyone aligned but also fosters a sense of ownership and purpose among your team.
Effective financial management is at the heart of both short- and long-term growth.
Start by reviewing (or creating) your budget that allocates resources for both immediate operations and future expansion. If you're managing a DSO, you’ll also have to consider individual budgets for each practice while also planning for overall organizational growth.
Moreover, having a very clear picture of cash flow is vital. Keep a close eye on your collections as a percentage of production, aiming for at least a 98% collection rate. This ensures you have the necessary funds to cover immediate expenses while also investing in future growth.
Optimizing your procurement processes and accounts payable strategies can also help optimize your cashflow. With clearer visibility into these areas of your back office, you can better align your purchases (supplies, equipment, etc) or other investments with your practice’s financial rhythms.
Speaking of technology and equipment, carefully evaluate or project ROI over a 3-5 year period. While new digital imaging equipment might have a significant upfront cost, the long-term benefits in terms of improved patient care and increased efficiency could justify the investment.
Don't forget to build financial safety nets. Allocate a percentage of your monthly revenue to both an emergency fund and a growth fund. This dual approach ensures you're prepared for unexpected expenses while also saving for future expansion opportunities.
As we touched on previously, effective inventory management is a powerful lever for overall practice health.
Pay particular attention to how you’re managing your inventory at your practice. Establish par levels for supplies based on monthly usage patterns. This helps prevent both stockouts and overstocking, optimizing your cash flow.
Balance just-in-time ordering with bulk purchasing for cost savings. For high-use items like gloves, consider bulk orders to take advantage of volume discounts. However, for perishable items or those with fluctuating demand, more frequent, smaller orders may be more appropriate.
Once you have a better handle on your inventory processes, revisit your relationship with vendors. If you’re only working with one supplier, we strongly recommend adopting a multi-vendor approach. Having at least 2 to 3 suppliers can ensure you avoid supply chain disruptions or certain supplies being out of stock.
You should also be regularly reviewing your contracts with vendors for year-over-year price increases and rebate thresholds to avoid unexpected costs and maximize savings. Conduct quarterly business reviews with your vendors to ensure you're getting optimal pricing and service. If you are working with a variety of them, perhaps narrow these reviews to the top five. These reviews also provide an opportunity to discuss future needs and potential partnerships that could support your long-term growth.
Trying to manage these processes manually can be downright impossible. Consider a procurement platform like Method so you can compare prices across vendors and track spending against budgets. This data-driven approach can lead to significant cost savings in the short term while informing strategic decisions for long-term growth.
Once your back office is sorted, it's time to turn to the patient-facing aspect of your practice.
When introducing new services, do so strategically based on market demand and your practice's long-term goals. For instance, you might phase in clear aligner treatments over 6 months while maintaining focus on your core services.
With your new systems and processes in place monitoring inventory, you’ll better be able to spot spikes in supply spend. Using your e-procurement platform, cross-reference with production data to determine if it correlates with increased procedures. This analysis helps distinguish between necessary expenditures for growth and potential inefficiencies in procurement.
Staff training should reflect both current needs and future growth areas. Schedule quarterly CE sessions to keep skills sharp for current services, and plan annual training for new technologies or services you're planning to introduce.
Patient feedback is invaluable for both immediate improvements and long-term planning. Make it easy for your patients to leave feedback and incorporate results into your monthly reviews. Use this information to make a priority list of immediate concerns, and use the aggregated data in your annual strategic planning to inform future service offerings.
Finding a steady balance within your dental practice is an ongoing process that requires careful planning, consistent execution, and regular reassessment.
The dental industry is constantly evolving, and your ability to adapt while maintaining a long-term perspective will be crucial to your success. Maintaining flexibility is key. Your practice will have its own rhythms based on your patient base. Monthly, quarterly, and annual planning sessions can help you adjust your strategies as needed.
While implementing these strategies may seem daunting, the benefits are worth the effort.
April 24, 2025
Within the last few years, dental practices and DSOs of all sizes have become quite familiar with price volatility when ordering supplies for their location(s).
Since 2020, dental supply costs have increased significantly, with some practices spending as much as 9% of their revenue on supplies (compared to about 6% pre-pandemic).
Supply chain disruptions, price fluctuations, and market uncertainties continue to drive these prices higher meaning practices must carefully consider their approach to purchasing.
But with so many factors out of their control, what can practice owners do?
In this post, we’ll talk through what these uncertainties mean and explore the best approach to protect your practice's financial health from a supply cost perspective.
Traditional ordering processes have given way to a more complex environment.
Inventory challenges both from the pricing and stock perspective stem from supply chain challenges that create both volatile pricing variations and inconsistent stock levels that affect practice profitability.
There are multiple factors at play here causing this.
In the case of current events—at least at the time of this writing—tariffs on countries that many suppliers source raw materials from or where factories are located can be one cause of price volatility.
Supply chain bottlenecks can be another. The "bullwhip effect", for instance, can be caused by over-ordering and wildly fluctuating demand. This effect results in persistent supply chain inefficiencies, keeping prices elevated even as demand stabilizes.
Recent data indicates dental practices experience price variations up to 30% on identical products, based on supplier relationships and purchase timing. Tariffs and trade disputes can cause this number to double or triple on some products depending on the trade policies in place.
Dental supplies, like any other manufactured goods, are part of an interconnected, global supply chain.
Changes in one area—whether from trade policies, manufacturing adjustments, or global events—create a ripple effect throughout the supply chain.
This is the cause of:
Much like during the pandemic, ongoing trade negotiations are very likely to affect dental practices nationwide almost immediately.
Suppliers adjust pricing strategies continuously, sometimes before actual cost increases occur.
This means practices often pay premium prices ahead of genuine market changes. These rapid fluctuations make budgeting and financial forecasting particularly challenging, with price variations of 15-25% on identical products within the same week.
Price increases are only the start of the issue.
To make sure they’re keeping the right amount of stock while keeping supply costs consistent, practice teams have to spend more time on building a supply order. That means additional time to searching for alternatives, comparing prices, and managing inventory.
This operational impact compounds the direct financial costs of higher-priced supplies, creating a cascade of challenges that practice owners must actively manage.
Many manufacturers and suppliers have already potentially invested in higher-priced inventory.
They'll need to sell through these existing stocks before prices can adjust downward.
What this means is that current supply chain challenges will influence prices well into the future, creating a lasting effect that extends beyond immediate market conditions.
Think of it like an echo. Even after the initial disruption subsides, its effects will continue to reverberate for the whole sector.
Suppliers who have modified their procurement patterns or shifted to new manufacturing sources may maintain these changes long-term, resulting in a new pricing baseline for many dental supplies.
This mirrors what we observed during the pandemic, where price normalization took 12-18 months after initial disruptions ended. Your practice needs to prepare for this extended timeline.
These structural changes in the supply chain mean practices must adapt their long-term budget planning and procurement strategies accordingly.
As of right now, every practice is in an uncertain dental supply market. The fact of the matter is: even after this storm passes, there will be another.
The best, strongest protection against unpredictable costs isn't panic buying in bulk or supplier loyalty programs.
Accurate, real-time data at the moment you place an order is the only way you can be sure you’re making informed decisions based on what is happening today as your team places an order.
Without accurate, real-time pricing data, your practice faces multiple challenges:
To protect your practice in today—and any day’s—volatile market:
This emphasizes the need of an effective procurement platform that allows you to tackle all of the above.
With a platform equipped with both inventory management and real-time supplier data, your team can spot pricing anomalies instantly. So if one supplier raises prices unexpectedly, you can immediately compare alternatives across a wider network without having to log into each individual website to check.
This real-time comparison prevents overpaying and helps identify the optimal time to place orders.
Dentists’ economic confidence has declined. According to one survey, only 35% of dentists expressed optimism about the U.S. economy in early 2025, reflecting broader economic volatility that impacts procurement decisions.
While a lack of confidence might be warranted given market conditions, practices aren’t at a loss of actions they can take.
Method has been advising all our clients to implement smart procurement practices and consistent cost monitoring to help create some level of stability week to week regardless of variable conditions.
Our platform is able to deliver instant insights into pricing trends, helping you make strategic purchasing decisions at the moment of order. You can track this information across multiple suppliers, validate price increases, and identify opportunities for savings all in real time.
April 16, 2025
There's no end to the pressures for those running a dental practice.
You've likely felt the waves of many of them: rising supply costs that eat into your margins, growing demands for transparency from both patients and regulators, and the never-ending need for efficiency in a world where every minute counts.
It's enough to make even the most seasoned practitioner's head spin.
So what should your team do as you look toward the new year? Fortunately for you, our team at Method has the privilege of engaging with dozens upon dozens of dentists at practices of all sizes—whether single location practices or large DSOs.
The common trend is this: change is coming fast and not small tweaks here and there. We're seeing seismic shifts that are going to redefine how dental practices manage their supplies and operations.
In 2025, the practices that stay ahead aren't going to be the ones clinging to outdated systems and crossing their fingers. No, the winners will be the ones who embrace the key shifts coming down the pipeline.
You don't have to wait until 2025 to start preparing. Let's take a look at what we're seeing and hearing about what’s to come in the next year or so.
The days of relying on reps and outdated systems to place orders are numbered. Practices are realizing that those methods are slow, costly, and a headache to manage. Trying to adopt a multi-supplier approach is hardly possible with your staff trying to handle it manually.
Forget the future, the present is digital, and procurement platforms (like our own Method) are going to dominate.
Here’s why:
Price Comparisons in Real-Time:
Being able to see prices from multiple suppliers at once makes it simple to choose the best deal without all the back-and-forth.
Automated Ordering:
Make manual mistakes or missed reorders a thing of the past and embrace set-it-and-forget-it automation.
Transparency:
Many practices lack visibility into where their money is going. With modern dental procurement platforms, you’ll get a clear picture of every dollar spent (shipping fees, bulk discounts, etc) with no surprises. In a way, you can get visibility into pricing that has never existed previously.
According to a Planet DDS report, over 60% of dental practices will have shifted to digital procurement by 2025. Everyone is trying to cut costs and take back control over purchasing, and platforms like Method are making that easy.
No matter what kind of business, data is the single most valuable asset any business has. Practices should start using their data and relying on analytics to make smarter ordering decisions. This will allow your practice to optimize your entire supply chain.
A couple of things to call out:
McKinsey reported that companies using data-driven procurement save up to 15% annually.
However, Method customers tend to see an average of 20% savings. For a single location practice, that’s significant. For a multi-location DSO, those numbers add up fast. Every penny saved is a penny you can invest elsewhere in your business.
Sustainability isn’t just a buzzword to pay lip service to. Patients care about it, and soon enough, they’re going to expect the practices they visit to care about it too. Sustainable procurement is going to have an indirect impact on how patients choose which practice they go to so better focus on it now rather than later.
Here’s a few potential trends we’re hearing about:
If you want to stay competitive, partnering with suppliers that align with your sustainability goals is a smart move.
For a long time, procurement has been seen as a cost center. Not exactly the most positive label. But fortunately, that’s changing.
Forward-thinking practices are treating procurement like a strategic function.
Why?
Because if you manage this function correctly, it becomes a competitive advantage.
As supply costs rise, the smartest practices will stop thinking of procurement as just another expense and start using it as a tool for growth.
Vendor competition is long overdue for a shift. After all, a lack of competition hurts innovation and customers. Procurement platforms like Method are making it easier for practices to work with multiple suppliers, putting them in direct competition.
This means you get better deals in a few ways:
A McKinsey article reports that industries using vendor competition platforms have cut supply costs by up to 12%.
And that’s just the beginning. But a word of caution: working with too many vendors can dilute your buying power, so be strategic as you choose your suppliers.
Artificial intelligence is changing literally everything. Procurement isn’t going to be an exception. AI-powered procurement platforms are going to make processes faster and smarter.
In 2025, Deloitte expects over 40% of dental practices to be using AI in their procurement process. It’s going to transform the way your practice operates and make everything more efficient and accurate.
If you haven’t invested in a procurement platform to order your supplies yet, you are stepping over dollars to try to save pennies.
In the wake of recent global disruptions, too many businesses have felt the pain of supply chain disruptions. While it’s not possible to account for every possible situation, all businesses including dental practices are realizing that a resilient supply chain is not just a nice-to-have — it's a must.
By 2025, we'll see a significant shift towards building robust, flexible procurement strategies that can weather any storm.
This makes it all the more important for practices to adopt multi-sourcing strategies, moving away from single-supplier dependencies. This approach will involve cultivating relationships with multiple vendors, ensuring that if one supplier faces issues, others can step in seamlessly.
Additionally, we'll certainly see a rise in the use of predictive analytics to anticipate potential disruptions before they occur.
Siloed systems and disconnected data have long overstayed their welcome. Over the next year or so, we’ll likely see more seamless integration between platforms. With regards to dental practices, procurement platforms will be seamlessly integrated with other commonly utilized systems. This will create a unified ecosystem that streamlines operations and enhances decision-making.
Why is this important? Think about how this will impact inventory management. As soon as a procedure is scheduled in the practice management system, you will be able to check inventory levels and, if necessary, trigger orders for required supplies. This proactive approach ensures that practices always have the right materials on hand without overstocking.
Follow that through to financial management systems. Procurement data will flow directly into accounting systems, providing real-time insights into spending patterns and profitability. Practice owners will be able to see how supply costs impact their bottom line instantly, allowing for more informed financial decisions.
Patient care will benefit too. With procurement joining other dental-specific dental software, practices can ensure they always have the specific materials needed for each patient's unique treatment plan. This could even extend to personalized products, with the system automatically ordering custom items based on patient records.
So, with all that in mind, what should you do next?
The most important step your practice should take is embracing digital procurement platforms. This gives you the ability to get you ahead of all of these trends whether that’s leveraging data, focusing on sustainability, or using technology to turn procurement into a strategic asset.
Platforms like Method are leading the charge, helping practices like yours save time, cut costs, and run smoother.
If you’re interested in hearing more, reach out to a Method expert today to learn more
April 5, 2025
Nobody wants to reach for a box for a crucial supply only to find an empty or expired box.
Inventory management is one of those subtle points of friction that many dental practices struggle with inventory management, but it doesn't have to be this way.
In this blog, we’ll talk about 12 common inventory mistakes your practice might be making and how to avoid them.
Before we jump into the common pitfalls, let's talk about why inventory management is such a big deal. Keeping your shelves stocked isn’t meant to be just busy work. Having the correct supplies on hand is important when you’re looking to optimize your entire practice's operations. If (or rather, when) things go awry, it is helpful to have everything you can control behind the scenes working smoothly.
First and foremost, proper inventory management translates directly to your bottom line. Studies show that dental practices can tie up as much as 30% of their annual revenue in inventory. If you’re ordering too much or not enough, you’re wasting capital that could otherwise be invested back into the practice with technology, staff training, or marketing efforts.
But the benefits don't stop at cost savings. Efficient inventory management means being more productive. Consider this: how much time do you and your staff spend hunting down supplies, placing emergency orders, or dealing with stockouts? Now, imagine redirecting all that time and energy towards patient care. The result is a more efficient practice, happier patients, and a team that can focus on providing the best dental care possible.
On the flip side, poor inventory management can have far-reaching consequences that extend beyond just running out of supplies. It's like a domino effect that can impact every aspect of your practice.
First and foremost, there's the potential risk to patient care. Nobody wants to reschedule a patient's procedure because you're missing a critical item. Not only does this disrupt your schedule, but it also erodes patient trust and satisfaction. Patient reviews can make or break a practice and these seemingly small hiccups can have a significant impact on your reputation.
Then there's the financial toll. Overstocking ties up your capital in unused inventory, while understocking can lead to rush orders and higher shipping costs. It's a delicate balance, and getting it wrong can eat into your profitability faster than you might think. Going by the figure we talked about earlier, if you’re spending over 30% of your annual revenue on supplies, you could be costing the practice money!
Now that we understand the stakes, let's talk through common inventory management mistakes that could be holding your practice back – and more importantly, how to fix them.
One of the biggest inventory management blunders is failing to accurately forecast your supply needs. Many practices rely on gut feeling or last-minute checks, leading to either overstocking (tying up capital) or understocking (causing stockouts).
The solution is in your hands: your own data. Modern inventory management systems can analyze your historical usage patterns, seasonal trends, and even upcoming appointments to predict your supply needs with incredible accuracy. Consider it your crystal ball for the stockroom, only this one can help save tens of thousands of dollars. By using your own production trends, you can optimize your ordering process and ensure you always have the right supplies on hand without unnecessary excess.
How often do you actually check your inventory? If you're like many practices, it's probably not as often as you should. Infrequent checks can lead to surprises–and not the good kind. You might suddenly realize you're out of a critical item or find expired products taking up valuable shelf space.
The solution is to implement a regular inventory check schedule. Set a weekly or bi-weekly schedule for a full inventory review, and you'll always have an accurate picture of your supplies. Like with any sort of maintenance, prevention is always better than cure!
If you're still managing your inventory with spreadsheets or pen and paper records, it's long past time for an upgrade. Manual systems are not only time-consuming but also prone to errors. It's like trying to perform a root canal with a hand drill.
The fix is simple: invest in a digital inventory management system. These cutting-edge solutions automate much of the process, from tracking usage to generating purchase orders. They provide real-time visibility into your stock levels, send alerts when it's time to reorder, and even integrate with your practice management software.
It's tempting to always go for the lowest price when ordering supplies. After all, who doesn't love a good deal? But focusing solely on purchase price can be a costly mistake. It's like choosing a dental chair based only on price without considering comfort, durability, or features. That won’t be just a one-time regret but one you'd likely sit with every day.
Instead, take a holistic view of your inventory costs, especially when it comes to clinical supplies. Consider factors like lead times, minimum order quantities, and supplier reliability. But don't stop there, factor in your doctors' preferences and clinical requirements too. After all, a bargain composite that doesn't meet your dentist's standards for handling or aesthetics isn't really a bargain at all.
A slightly higher price from a vendor who offers faster shipping, better customer service, and consistently high-quality products might actually save you money in the long run. It can reduce the chance of running out of items, minimize rush orders, and ensure your clinical team has the tools they need to deliver exceptional care.
A disorganized stockroom is another major efficiency killer and a source of waste. If your staff is afraid to pull out a box at risk of upsetting a Jenga-like stack of boxes, it's time for a change. Poor organization can lead to overlooked items, difficulty in finding supplies, and even expired products.
Instead, implement a logical organization system. Use clear, labeled bins for smaller items. Arrange products by category or frequency of use. And most importantly, follow a FIFO (First In, First Out) principle to ensure older stock gets used before it expires. A well-organized stockroom sets the stage for a well-organized practice.
We've all been there – ordering a large quantity of an item "just in case" we need it. But this approach can lead to unnecessary costs and wasted storage space. It's particularly common with items like specialized composite shades or rarely used instruments.
Instead of overordering, use your inventory management system to set appropriate par levels for each item based on actual usage. For infrequently used items, consider partnering with suppliers who offer quick shipping on small orders. This way, you can keep your inventory lean without sacrificing the ability to meet unexpected needs.
Even the best inventory system won't work if your team doesn't know how to use it properly. Lack of training can lead to inconsistent practices, data entry errors, and missed reorder points.
The solution is simple: make sure everyone understands the importance of accurate data entry, proper storage procedures, and how to use your inventory management software. Regular refresher sessions can help reinforce best practices and introduce new features or processes.
Storing supplies in multiple locations throughout your practice might be a matter of necessity but can easily lead to confusion, overstocking, and lost items. Centralize your inventory storage as much as possible. Designate a primary stockroom where the bulk of your supplies are kept.
If you need to keep some items in treatment rooms for immediate access, treat these as mini-stockrooms with their own par levels and regular restocking schedule. This centralized approach gives you a clearer picture of your overall inventory and makes management much more straightforward.
If you're not regularly generating and reviewing data on your inventory levels, you're missing out on valuable insights that could help optimize your supply chain and budget.
Regularly look at usage trends, spending by category, and supplier performance. Many modern inventory systems can generate these reports automatically and even provide actionable insights. Use this data to make informed decisions about your ordering patterns, negotiate better deals with suppliers, and identify areas for cost savings.
In many practices, inventory management is a shared responsibility which often means it's no one's primary focus. This can lead to oversights, inconsistencies, and a general lack of accountability. The solution is to designate a primary inventory manager. This doesn't mean this person has to do everything related to inventory, but they should be responsible for overseeing the process, ensuring consistency, and being the go-to person for inventory-related questions. In smaller practices, this might be the office manager, while larger practices might have a dedicated inventory coordinator.
In the excitement of trying new products, it's tempting to place a large order right away. But this can lead to wasted money and storage space if the product doesn't meet your needs. It's like changing your entire restorative protocol based on a single CE course without trying it in your own practice first.
Instead, start small. Many suppliers offer sample sizes or trial periods for new products. Take advantage of these opportunities to test new items in your practice before committing to a large order. This is especially important when it comes to clinical supplies. By starting small, you can assess the product's effectiveness, ease of use, and patient acceptance before making a significant investment.
Last but certainly not least, failing to track and manage product expiration dates can lead to significant waste and potential patient safety issues. It's easy to lose track of expiration dates, especially for less frequently used items. But using expired products is not only financially wasteful – it could compromise patient care.
Implement a system for tracking expiration dates as part of your regular inventory management process. Many digital inventory systems can send alerts when products are approaching their expiration date. For items with shorter shelf lives, consider implementing a color-coded system in your stockroom to visually flag products that need to be used soon.
Effective inventory management is paramount for dental practices, offering benefits that range from increased efficiency and profitability to improved patient care. As practices grow, the challenges of managing inventory can become more complex.
Fortunately, these challenges also present an opportunity to optimize your operations.
The secret to unlocking the benefits we discussed in this blog lies in selecting the right dental procurement platform with built-in inventory management capabilities. A well-designed system can transform inventory management from a time-consuming chore into a powerful driver of practice success.
Method is one such platform that stands out in addressing these needs. By integrating seamlessly with your practice's workflow, Method can help you streamline your inventory processes, reduce errors, and free up valuable time for patient care.
Book a free demo with a Method expert today and discover how the right platform can revolutionize your inventory management, setting your practice on the path to greater efficiency and success.
March 14, 2025
That’s not a question you might have at the front of your mind. For good reason. You’re probably thinking about quality patient care, getting more patients into the office, dental assistant turnover, etc. After you think about all that, then and only then do you ask, “Am I even profitable?”
However, profitability must be a top priority if you want to expand your services, open a new location, or simply ensure long-term sustainability.
Profitability is the deciding factor in whether you can grow your practice. Unlike a simple “more revenue equals more profit” mindset, true profitability in a dental practice depends on collections versus production, dental practice expenses, operating costs, and growth costs.
Let’s dig in.
At a high level, profitability means making more money than you spend. Simple, right? Yes and no. There are different levels of profitability, and knowing where you stand is critical for making informed decisions. A big part of this comes down to how your month-to-month revenue cycle unfolds:
You might see a month of high collections (due to payments arriving from previously completed procedures), followed by a month of heavy production but fewer collections. This back-and-forth can create a “see-saw” pattern in your net margins. Tracking these cycles closely is essential for maintaining stable cash flow and avoiding major commitments based on a single spike in revenue. Because if you did that, it could mean bad news bears. When managing your finances as a business, you want to ensure that revenue is sustainable, not just a random one-off.
Below is a breakdown of how collections compare to production—and how that shapes profitability:
If collections are lower than production, you may be running at a loss or hovering close to it. Net margins often drop below 5%. Before taking on expansions, identify core issues—such as low case acceptance, out-of-date fee schedules, or inconsistent revenue cycle management—to get back on track.
When collections match production, you generally net below 10%. You cover the basics but have minimal flexibility for unexpected costs.
Greg Essenmacher, founder and CEO of GnA Consulting, notes, “Determining the break-even point is a critical first step in analyzing the dental practice's financials and identifying areas for improvement. It provides the baseline to then assess profitability margins.”
If your collections slightly exceed production, you’re likely netting in the 10-15% range. This setup allows for measured growth—like adding a new service line or part-time staff—without straining finances. Many practices operate successfully here, balancing overhead and revenue effectively.
If your collections significantly outpace production (netting 30% or more), you have the freedom to invest in new tech, increase pay, or even acquire another practice without risking stability. Achieving this tier typically requires disciplined revenue cycle management, streamlined operations, and ongoing expense monitoring.
Understanding exactly where you stand in profitability determines if you can safely add treatments that come with higher upfront costs such as full arch procedures or extensive cosmetic work. If your margins are tight, taking on more expensive cases can add financial strain. By knowing your true profitability level, you’ll have clarity on when (and how) to expand your services.
Tracking how collections align with production is crucial, but it’s only half of the story. You also need a clear view of the expenses that go into delivering patient care. These typically include:
In total, aim to keep these at roughly 40–50% of production. If they climb higher, look for ways to negotiate with vendors, adjust compensation arrangements, or better manage supply inventory.
Even when clinical costs are under control, other operating expenses can quietly eat away at your profit margin:
Practices sometimes hire additional staff or lease larger spaces prematurely, leading to overhead “bloat.” Each significant operating cost should link back to measurable productivity or collections gains.
Growth-related spending—marketing, more office space, advanced equipment—should be evaluated for its potential return:
You might be attracting enough leads, but if your practice struggles with case presentation or scheduling, your marketing ROI will appear weaker than it actually is.
Whether you’re just above break-even or already in the sustainable zone, you can look into the following expenses to take the following steps to improve margins:
As a practice owner, you balance providing great patient care with maintaining a healthy bottom line. If you want to improve profitability in the near term, it helps to pinpoint exactly where your revenue and expenses stand. Start by targeting supply costs. Aim for supplies to be 7–10% of production, ideally less, and use data-driven tools like Method to track spending in real time.
It’s also crucial to monitor key performance indicators (KPIs) so you can stay on top of the broader financial picture. Five KPIs worth keeping front and center are:
By focusing on these metrics, along with understanding your collections-versus-production balance, overseeing clinical and operating costs, and watching for the see-saw effect in monthly revenue, you can shift from unprofitable or break-even to truly sustainable or highly profitable. With that foundation, you’ll be ready to expand services, invest in new opportunities, and ensure your dental practice remains a thriving, successful enterprise. It’s your practice, it’s your money. Manage it well and it will take care of you.
March 11, 2025
Profit margins are the lifeline of any dental practice, and at 30-40%, the dental industry offers healthy potential for sustainable growth.
But don't let those numbers lull you into a false sense of security.
While these margins dwarf those of auto dealerships (3%) or life insurance companies (0.72%), they can vanish quickly through inefficient operations and procurement blind spots. Understanding, measuring, and optimizing certain key performance indicators (KPIs) can make all the difference between strong, sustainable growth and having your books in the red.
Let's explore the numbers that determine how well you’re managing your practice's procurement and cash flow.
Just as a doctor monitors vital signs to gauge a patient's health, KPIs for procurement provide crucial insights into your practice's operational wellness.
These metrics reveal not just how much you're spending, but whether those dollars are being used efficiently, from tracking price variations across suppliers to identifying opportunities for bulk purchasing discounts.
By closely monitoring procurement KPIs, you can spot concerning trends before they become serious problems, negotiate more effectively with suppliers, and ensure your practice maintains healthy profit margins in an increasingly competitive marketplace.
These metrics provide crucial insights into your practice's operational wellness. For instance, supply costs typically represent 4-6% of a practice's collections. Even small improvements in procurement efficiency can significantly impact your bottom line.
Consider a practice with $1 million in annual collections. At 6% supply costs, they're spending $60,000 annually on supplies. By optimizing procurement to bring that down to 4%, they'd reduce spending to $40,000 - a $20,000 difference that goes straight to the bottom line.
The challenge? Many practices are flying blind when it comes to their procurement processes.
Your practice might know its total monthly spending, but that’s only a fraction of the bigger picture. Without deeper insights, you’re missing opportunities to optimize their operations and maximize profitability.
That's where these seven essential KPIs come into play.
How much you're spending is a relative number. The real insights come from understanding how your procurement costs align with your revenue and collections.
A practice bringing in $2 million annually might panic at $100,000 in supply costs, while that same number could signal serious overspending for a practice collecting half that amount.
Your costs should maintain a consistent relationship with your revenue, typically falling between 4-6% of collections. When this ratio starts to drift, it often indicates underlying issues like price creep from suppliers, inefficient ordering practices, or missed opportunities for bulk discounts.
By tracking this metric monthly, you can quickly spot trends and take corrective action before small issues become major problems.
Here's a metric that often surprises practice owners: leading DSOs maintain a private label utilization rate between 30-40%.
Why? Aren’t premium products simply better?
Well, these so-called private label products often deliver comparable quality at 30-50% lower costs than branded alternatives. In fact, many of these private label products are actually manufactured by the same companies producing the branded versions, just without the premium pricing that comes with the name recognition.
For example, those mixing tips you're paying $60 for from a major brand? The private label version could cost just $25 for literally the exact same item with a different sticker on it. If your practice isn't hitting at least 30% private label utilization, you're most definitely leaving money on the table.
This measurement is less about keeping order sizes low and frequent or high and seldom. How large your Average Order Size is determined by your practices habits. Small, frequent orders may create unnecessary administrative burden and shipping costs for one practice yet another may literally not have the storage space for larger orders. By monitoring and optimizing your average order size, you can reduce headaches caused by orders that are too large or too small for your practice’s needs.
Your formulary is a powerful cost control mechanism.
When you’ve got the right suppliers and the right products set up within your procurement platform, higher compliance is better. That’s because high compliance rates (aim for 70% or higher) indicate that your team is following established purchasing protocols and taking advantage of negotiated pricing. Low compliance often signals a need for better staff training or formulary adjustments because what the staff wants is not on there.
The sweet spot? Two to four primary suppliers.
Too few suppliers limit your negotiating power, while too many create unnecessary complexity. You want the competitive process, but you don't want to burden the organization.
Monitor your supplier mix to ensure you're maintaining healthy competition while keeping operations manageable.
Depending on the practice size, specialty, and other factors, a single practice location can be dealing with anywhere from 500 to more than 2,000 different types of supplies at any given time. Price creep is not only likely but a guarantee if you’re not monitoring costs.
A small price increase here, another one there, and before you know it they’ve accumulated into significant extra costs. Track price variations across your key supplies and leverage this data in supplier negotiations.
You can't push back against price increases if you're not watching for them.
This isn’t much different than managing spend overall but still an invaluable exercise to do regularly. Breaking down your spending by category (hygiene, restorative, infection control, etc.) so you can see a different view of where your money is going.
You might find additional savings opportunities if you find you’re over ordering one category or having to rush-ship another because you keep running out.
This granular view helps you identify areas for optimization and supports more strategic purchasing decisions.
Having these KPIs is just the starting point. The real value comes from how you use them. Let’s take a look at how to make the most of these metrics:
Start by establishing baseline measurements for each KPI.
Compare your numbers against industry standards, but remember that your practice's unique characteristics might require adjusted targets. The goal isn't to hit arbitrary numbers—especially if they make no sense for your practice. Instead, you want to drive consistent, achievable, but continuous improvement.
Make KPI review a regular part of your practice management routine.
Monthly reviews help you spot trends early, while quarterly deep dives allow you to assess progress toward longer-term goals. Share relevant metrics with your team to foster accountability and engagement in procurement optimization efforts.
Dental procurement platforms make tracking these KPIs infinitely easier than manual methods.
Instead of spending your day trawling through excel spreadsheets, you can instead have exactly the view you’re looking for in just a few clicks. The right technology can turn procurement from a chore into a breeze that’ll cement a powerful strategic advantage for your practice.
Getting visibility into these crucial KPIs has traditionally been a nightmare for dental practices. With data scattered across supplier portals, spreadsheets, and paper records, tracking procurement metrics often feels like solving a puzzle with pieces from different boxes (and more than a few pieces might be missing).
Fortunately, technology has offered a better approach.
Method brings all these critical metrics together in one unified view, right out of the box. No more juggling multiple systems or manually compiling reports.
Instead of spending hours hunting down numbers, you can access real-time insights with a few clicks. From tracking private label utilization to monitoring price variations across suppliers, Method illuminates your entire procurement process from end to end.
Your practice's financial health shouldn't be a guessing game. Take control of your procurement metrics today and transform those blind spots into opportunities for growth.
February 21, 2025
Running a successful dental practice of any size involves far more than clinical expertise. It's about mastering the behind-the-scenes business activities that ensure your practice keeps thriving.
One often overlooked but crucial aspect of running a successful dental practice is procurement. Whether you're a single-location practice, a multi-location group, or a Dental Service Organization (DSO), optimizing your procurement process can lead to significant cost savings and operational efficiencies.
Let's dive into the world of dental procurement and discover how it can transform your practice.
Many dental practices, regardless of size, often believe they lack the buying power to negotiate better deals. In actuality, you have more leverage than you think. The truth is that your procurement strategy, not just your volume, can drive substantial savings.
Even smaller practices can leverage smart procurement tactics to reduce costs and improve their bottom line.
The first step to better procurement is realizing that you have more negotiating power than you might believe. Suppliers are often willing to offer better prices and terms to practices that demonstrate a structured and fair procurement process.
Here's how you can leverage this:
By following these steps, you create a competitive environment where suppliers are motivated to offer their best prices to win your business.
Sole sourcing may appear to be a straightforward solution for dental practices. This is a critical mistake that can significantly undermine your financial health and operational flexibility in the long run.
While it might seem simpler to work with just one supplier, this approach can lead to price creep, reduced motivation to offer competitive prices, and puts you at risk for stock shortages should that supplier run out.
Working with multiple suppliers allows you to:
It's crucial to strike the right balance. Working with too many suppliers can create logistical challenges and inefficiencies.
The sweet spot is typically 2-3 suppliers, with a maximum of 4 for larger practices or DSOs.
Managing a multi-supplier approach manually can be challenging, especially for larger practices or DSOs.
This is where procurement platforms come into play. Advanced procurement platforms designed for the dental industry can help you:
For multi-location practices and DSOs, technology can be a game-changer in maintaining consistency and compliance across all locations.
One often overlooked tactic for substantial cost savings is the strategic use of private label products. These versions of products can offer jaw-dropping savings of 30-50% compared to their branded counterparts, without compromising on the quality your patients deserve and expect.
Keep in mind that not all private labels are created equal. The quality can vary as much as the shades in your composite resin kit. That's why it's crucial to approach private label procurement with the same precision you apply to your clinical work.
The good news? Many high-quality private label products are manufactured by the same companies producing the branded items you already trust. So in the end, you’re getting the same top-notch ingredients in a different package and at a fraction of the cost.
To truly optimize your savings, aim for a private label percentage of 30-40% of your total spend. This sweet spot balances cost-effectiveness with maintaining a diverse and reliable supply chain.
But how do you achieve this without spending hours comparing products? This is where a dental procurement platform comes into play. Modern platforms can easily identify private label alternatives to your current products, making for a smooth switch.
For Dental Service Organizations (DSOs), the impact is even more dramatic. By increasing private label usage from a modest 20% to an optimized 30-40%, you're looking at substantial cost savings that ripple across your entire organization. That money can then be reinvested in state-of-the-art equipment, enhancing staff training, or simply boosting your cash position.
Depending on the state of your practice today, embracing private label products is a smart, strategic move that can radically shift your practice's financial health.
For smaller dental practices or those managing fewer than 6-8 locations, joining a Group Purchasing Organization (GPO) can be an excellent strategy to access more competitive pricing.
GPOs leverage their collective buying power to negotiate directly with manufacturers, securing discounts that are then passed on to their members.
The benefits of GPO membership are significant. Members gain access to discounts typically reserved for larger organizations, reducing the need for direct negotiations with manufacturers. This can lead to substantial cost savings on supplies, effectively leveling the playing field for smaller practices.
By joining a GPO, these practices can gain access to pricing structures that were previously out of reach, potentially leading to significant improvements in profit margins without compromising on the quality of supplies.
It's important to note that maximizing GPO benefits requires more than just membership. To fully leverage these advantages, practices need to implement the right technology solutions. An effective procurement platform can help practices navigate the array of discounted products efficiently, ensure consistent use of GPO pricing across all purchases, track and quantify savings over time, and streamline the ordering process.
By combining GPO membership with appropriate technology, dental practices of all sizes can optimize their procurement processes, improving financial performance and operational efficiency.
To truly revolutionize your dental practice's procurement process, you need to keep your finger on the pulse of performance. It's not just about buying supplies; it's about smart, strategic purchasing that boosts your bottom line.
For starters, aim for a private label percentage of 30-40% of your total spend. This sweet spot balances cost savings with quality assurance. Next, keep an eye on your average order size. Is your office ordering the same products frequently? Bigger orders often mean lower processing and shipping costs, so when the time (and price) is right, stock up.
Formulary compliance is another crucial metric. This ratio refers to how well your team sticks to your preferred product list, ensuring you're leveraging your carefully negotiated deals. Track your cost savings month-over-month and year-over-year to see your procurement strategy in action.
Don't forget about supplier performance. On-time delivery, order accuracy, and customer service are vital for smooth operations.
Like any business, what gets measured gets managed. Tracking these KPIs will go a long way to improving your overall efficiency and cost savings over time.
Effective procurement isn't a "set it and forget it" endeavor. It's an ongoing process that requires constant attention and refinement—and the process never ends.
The dental industry is always evolving, with market conditions, product offerings, and practice needs in a constant state of flux. That means that standing still is essentially falling behind.
Consider this: the composite material you've been using for years might now have a more cost-effective alternative that offers the same or better clinical results. Or perhaps there's a new private label option for your favorite impression material that could save you significant money without compromising quality.
Regularly reassessing your product choices, considering both economic and clinical factors, is crucial. Even if you love a particular product, two years later, there may be an alternative that's significantly less expensive. In the dental context, this could mean finding a high-quality bonding agent for $60 that performs just as well as the $150 option you've been using.
This ongoing evaluation process should involve both your business team and your clinical staff. You don't want the business people dictating the clinical products the clinicians are using, but the business people can ask the clinicians, "Hey, this composite is out. Let me know if you like it. The manufacturer just came in and we could save 40% on composites, but I want you guys to sign off on this."
By fostering this collaborative approach and maintaining a commitment to continuous improvement, you can ensure your procurement strategy remains cutting-edge, cost-effective, and clinically sound.
If you remember one thing from this article, it’s this: you have more leverage than you might think.
Whether you're a single-location practice looking to boost profitability or a DSO aiming to standardize procurement across multiple locations, focusing on smart procurement strategies can yield substantial benefits.
With these strategies, you can turn procurement from a necessary expense into a true competitive advantage for your dental practice.
January 30, 2025
Dentists, and by extension their practices, are no strangers to precision.
A fraction of a millimeter can mean the difference between a successful procedure and one that requires revision. Yet, while this level of precision is second nature in clinical settings, it's often overlooked in a crucial area of practice management: financial processes.
Many dental practices that pride themselves on their clinical accuracy may be surprised to find their financial systems lacking the same level of precision. This disconnect can lead to inefficiencies, errors, and missed opportunities for growth.
One such opportunity is invoice matching - a financial practice that brings the same level of exactitude to your books that you bring to your patients' care.
In this article, we'll explore how invoice matching works, why it's crucial for your practice's financial health, and how implementing a matching process can be the foundation your practice needs to reach your profitability goals.
Consider this scenario: it’s time to close the books for the month. Your team has gotten in a bunch of supplies but there are a whole bunch of invoices to go with each shipment. Obviously the invoices should be paid but are you certain every single one of them is correct?
There are any number of discrepancies that mean the invoice shouldn’t be paid as is. This includes situations like:
Not having insight into these situations is precisely where many practices go wrong. You wouldn't treat a patient without first examining their full dental history. The same principle applies to your practice's finances.
Invoice matching matters because it ensures long-term financial health by spotting issues before they become significant problems.
This could include things like the following.
Invoice matching acts as your practice's financial safeguard, identifying discrepancies and potential fraud. It catches duplicate invoices efficiently and identifies pricing discrepancies that could be impacting your bottom line.
With invoice matching, you'll ensure timely payments, avoid late fees, and even capture early payment discounts. It's like giving your practice's bank account a regular check-up and cleaning.
Just as you build trust with your patients, invoice matching helps you foster strong relationships with your suppliers. By reducing payment disputes and facilitating clear communication, you'll become a preferred customer.
Ready to elevate your practice's finances? Here's a quick roadmap to implementing invoice matching.
Start by creating comprehensive procurement policies that outline the entire purchasing process.
These policies should detail who has the authority to make purchases, spending limits, approved vendors, and the required documentation for each transaction. Clear guidelines ensure consistency across all departments and reduce the likelihood of unauthorized purchases or incomplete documentation.
Include steps for initiating purchase requests, obtaining approvals, and submitting orders. Make sure these policies are easily accessible to all staff members and provide training to ensure everyone understands their role in the procurement process. Regularly review and update these policies to reflect changes in your practice's needs or industry standards.
Consistency is key when it comes to efficient invoice matching.
Develop standardized templates for purchase orders, receipts, and invoices that capture all necessary information in a uniform format. These templates should include fields for essential data such as item descriptions, quantities, unit prices, total amounts, order numbers, and vendor information.
Work with your suppliers to ensure their invoices align with your preferred format. If possible, implement electronic forms to reduce manual data entry errors. Standardization not only simplifies the matching process but also makes it easier to spot discrepancies quickly.
Implement a centralized digital repository for all procurement-related documents.
This system should be secure, easily accessible to authorized personnel, and capable of organizing documents by type, date, vendor, and other relevant criteria. Consider cloud-based solutions that offer robust search capabilities and allow for real-time updates.
Ensure the system can handle various file formats and has sufficient storage capacity for your practice's needs. Implement a clear naming convention and folder structure to make document retrieval efficient. Regular backups and data security measures are crucial to protect sensitive financial information. Train your team on how to properly use and maintain this centralized system to ensure its effectiveness.
Establish clear criteria for what constitutes a match between purchase orders, receipts, and invoices.
This may include exact matches on item descriptions, quantities, and prices, as well as order numbers and dates. Determine acceptable tolerance levels for discrepancies, such as slight variations in pricing or quantity due to rounding or shipping adjustments.
These tolerance levels should be based on your practice's risk tolerance and the typical nature of your purchases. Create a hierarchy of matching requirements, distinguishing between critical fields that must match exactly and less crucial fields where some variation is acceptable.
While manual invoice matching can certainly improve your practice's financial accuracy, the true power of this process is achieved with automation. This way you can scale your financial processes alongside your practice.
When selecting an automated invoice matching solution for your dental practice, prioritize systems that align with your specific needs and goals. Look for seamless integration capabilities with your existing financial and practice management software to ensure smooth data flow and eliminate manual entry across platforms. The ideal solution should offer customizable matching rules to accommodate your practice's unique requirements and efficient exception handling processes for quick issue resolution.
Implementing invoice matching in your dental practice can have rippling effects through every aspect of your operations. By bringing the same level of precision to your financial processes that you apply to patient care, you're setting the stage for unprecedented growth and efficiency.
The key takeaway is clear: automating invoice matching is not just about preventing errors or saving money, though it certainly accomplishes both. It's about freeing up your team's time and mental energy to focus on what truly matters: providing exceptional patient care.
When you're not bogged down by manual financial processes or constantly putting out fires caused by invoice discrepancies, you and your staff can dedicate more attention to enhancing the patient experience. This could mean spending extra time explaining procedures, investing in advanced training, or simply being more present and less stressed during patient interactions.
By optimizing your back-office processes with automated invoice matching, you're ultimately investing in your ability to deliver top-notch care and build lasting patient relationships.
Take the first step today towards financial precision and talk to a Method team member today for a short, personalized demonstration of how our platform can help with invoice matching and more.
January 13, 2025
Balancing costs with maintaining high-quality patient care is a constant challenge for dental practices of any size.
As practice owners and dental service organizations (DSOs) look for ways to optimize their operations, one strategy often overlooked is the strategic use of private label products.
These alternatives to brand-name items offer significant potential for cost savings without necessarily compromising on quality.
In this article, we'll explore how dental practices can leverage private label products to maximize their cost savings and improve their bottom line.
Private label products, sometimes known as store brands or generic products in other industries, are items manufactured by one company but sold under another company's brand name. In the dental industry, these products range from disposable items like gloves and masks to more specialized equipment and materials.
Many dental professionals have misconceptions about private label products, often assuming they are always inferior to branded alternatives. However, the reality is far more nuanced. Private label products in dentistry span a wide range of quality levels, from basic to premium.
In fact, many high-quality private label items are manufactured by the same companies that produce well-known branded products.
The primary appeal of private label products is their cost-effectiveness. On average, dental practices can expect to save 30-50% compared to branded equivalents. This substantial difference can have a significant impact on a practice's overall expenses.
For example, consider a common item like impression material mixing tips. A branded product might cost $60 for a pack of 48, while a comparable private label alternative could be available for just $25 – a savings of nearly 60%.
When applied across numerous products used daily in a dental practice, these savings can quickly add up to thousands of dollars annually.
For larger organizations like DSOs, the impact is even more pronounced. Industry data suggests that top-performing DSOs aim for a private label usage of 30-40% of their total spend.
For a DSO currently at 20% private label usage, increasing to 30-40% could result in savings of hundreds of thousands or even millions of dollars across the organization.
While cost savings are important, they shouldn't come at the expense of quality patient care. It's crucial to understand that not all private label products are created equal. Quality can vary significantly between different private label offerings, which is why careful evaluation is essential.
When considering private label alternatives, it's important to evaluate each product individually.
Yes, many numerous high-quality private label products are manufactured by the same companies that produce branded items. These manufacturers often use the same materials and production processes for both branded and private label products, with the main difference being the packaging and marketing.
But you’ve got to conduct your due diligence to ensure that this is the case for any given product.
Factors to consider include the manufacturer's reputation, the product's performance characteristics, and any available clinical data or user reviews. By taking a thoughtful approach to product selection, practices can often find private label options that meet or even exceed the quality of branded alternatives.
Transitioning to private label products doesn't have to be an all-or-nothing proposition. A gradual implementation strategy can help practices find the right balance between cost savings and maintaining familiar products.
Here are some strategies to consider:
Begin by replacing office supplies, disposables, and other non-clinical items with private label alternatives. This allows you to realize immediate savings with minimal impact on clinical procedures.
When evaluating private label options for clinical materials, involve your dental team in the decision-making process. Their hands-on experience can be invaluable in assessing product quality and performance.
Many modern procurement systems offer features that make it easy to identify and compare private label alternatives to your current products. Look for software that provides "similar product" suggestions and allows for easy product swapping in your catalog.
Develop a formulary or preferred product list that includes high-quality private label options. This can guide purchasing decisions and help maintain consistency across multiple locations for DSOs.
Before making a full switch to a private label product, order a small quantity for testing. This allows you to evaluate its performance in real-world conditions without a significant financial commitment.
Despite the potential benefits, some dental professionals may be hesitant to adopt private label products. Common concerns include perceived quality issues or worries about patient perception.
To address these concerns:
To maximize the benefits of private label products and streamline their integration into your practice, consider the following best practices that combine effective use of technology with strategic product management.
Modern procurement platforms offer powerful tools that can significantly simplify the process of adopting and managing private label products.
Look for software that provides automatic suggestions for private label alternatives to your current products, allowing you to easily identify potential cost-saving opportunities. The ability to quickly swap branded items with private label options in your catalog streamlines the transition process. Additionally, robust compliance tracking features help ensure that your team adheres to the use of preferred products, including private label items.
The dental supply market is dynamic, with new products and trends emerging regularly. To maintain an effective private label strategy, it's crucial to periodically reassess your choices.
Use the data analytics from your procurement software to guide these reviews, identifying areas for potential improvement or additional savings. Simultaneously, always be investigating new private label offerings and industry trends that might impact your product choices.
Building and maintaining strong relationships with your suppliers is crucial for ensuring the consistent quality and reliable supply of your chosen private label products.
Track supplier performance metrics such as delivery times, order accuracy, and product quality. This data can facilitate open and productive communications with your suppliers, allowing you to address any issues promptly and collaboratively work towards improvements.
Strong supplier relationships can also lead to better pricing, early access to new products, and valuable insights into market trends.
It is essential to ensure adherence to your preferred product list, including private label items. Regularly review these metrics to identify any areas where compliance may be lagging. This information can guide you in adjusting your strategy or providing additional staff training as needed.
Private label products offer dental practices a powerful tool for managing costs without compromising on quality.
As with any change in your practice, the key to success lies in careful evaluation, gradual implementation, and ongoing assessment. With the right approach and the support of modern procurement technology, private label products can help your practice thrive in an increasingly competitive dental landscape.
By thoughtfully incorporating these alternatives into your procurement strategy, you can realize significant savings that can be reinvested in your practice or passed on to patients.
January 9, 2025
What if we told you there's a mental barrier preventing most dentists from taking their practices to the next level?
The answer may surprise you, but it's rooted in a fundamental misunderstanding about how modern dental practices thrive.
When running a practice, you're not just a healthcare provider – you're a business owner navigating the challenging environment of the new dental economy.
The secret to running an effective practice lies in having a solid roadmap to follow and that means having frequent checkpoints along the way.
In this comprehensive guide, we're going to supercharge your practice management skills with the ultimate planning checklist.
We'll break down the essential review periods – monthly, quarterly, and annual reviews – that will keep your dental business running at peak performance. Whether you're a solo practitioner or steering a multi-location DSO, this blueprint for success will help you:
Your practice probably already has some form of monthly planning to keep your practice on track. But are you maximizing the potential of these regular planning sessions? Let's explore how to refine and enhance your existing processes and make them powerful drivers of practice performance.
Review Your Key Performance Indicators (KPIs)
Sometimes it can be hard to tell how your practice is really doing. That’s why your monthly review should always include a focus on concrete numbers. Focus on important KPIs that ensure your practice is on the right track. This includes:
Expert Tip: Use your e-procurement platform to track supply costs against production. This data-driven approach can help optimize your spending and improve profitability.
Meetings are a double-edged sword. They can either be huge drivers of productivity and build rapport amongst your team or be an expensive waste of time. Monthly staff meetings ensure everyone is aligned and working efficiently. Here are a few tips to make sure you’re getting the most out of these conversations:
If you look behind the scenes of any thriving dental practice, you’ll find a team, working in unison towards shared goals. Regular monthly check-ins are so important to fostering a culture of collaboration and clear communication.
Ever started your week with a clear idea of how it might go only to find that it’s pandemonium by the end? We’ve all been there. Since this can be a common occurrence in practicing dentistry, it’s important to keep your short term goals flexible. During your monthly planning sessions, you should focus on the following:
Expert tip: SMART goals are really helpful to setting goals. This acronym refers to setting goals that are specific, measurable, achievable, relevant, and have a set timeline.
Effective inventory management helps dental practices reduce costs, improve cash flow, and prevent revenue loss because you didn’t have the necessary supplies for a patient. Monthly inventory reviews ensure you're always stocked with what you need, when you need it. Here are a few tips to make sure you're maximizing your inventory efficiency:
Behind every efficient dental practice is a well-managed inventory system. Regular monthly inventory audits are crucial for maintaining optimal stock levels, reducing waste, and ultimately enhancing your practice's financial health.
Your practice's success isn't just about what happens in the chair – it's also about getting patients in the door.
Plan Next Month's Marketing Activities
Whether it's a social media campaign or a local event sponsorship, stay proactive in your marketing efforts. Look to capitalize on:
What's your ROI on that Google Ads campaign? Adjust your strategy based on real data. Start by gathering comprehensive analytics from all your active marketing channels. This could include:
Once you have this data, analyze it critically.
Which campaigns are performing well, and why? Are there any underperforming areas where you're not seeing a good return on investment? Use these insights to make data-driven decisions about your marketing strategy.
This might involve reallocating budget from low-performing channels to high-performing ones, tweaking your messaging based on what resonates with your audience, or exploring new marketing avenues that align with your successful campaigns.
Expert Tip: Use your patient management system to identify patients due for recall and plan targeted communication efforts.
While monthly planning keeps your practice on track, quarterly planning sessions offer a valuable opportunity to take a broader view of your practice's performance and make more substantial adjustments.
Think of these quarterly check-ins as a chance to step back from the day-to-day operations and focus on the bigger picture.
Financial Performance Review
A quarterly financial performance review should go beyond the monthly review of KPIs to include a comprehensive analysis of your practice's financial health. Start by comparing your actual results to the budgeted goals you set at the beginning of the year. Are you on track, ahead of the game, or falling behind? This comparison provides crucial insights into your practice's overall performance and helps identify areas that may need attention.
Next, turn your attention to profit margins and overhead costs.
Dental practices often operate on tight margins, so even small fluctuations can have significant impacts. Analyze each category of expenses, from staff salaries to equipment maintenance, and look for trends or anomalies.
Are your supply costs creeping up? Has your marketing spend yielded the expected return on investment? This detailed examination can reveal opportunities for cost-saving measures or areas where additional investment might boost productivity and profitability.
Fee Schedule Assessment
The quarterly review is also an ideal time to reassess your fee schedule. Things move fast when you’re running your own practice or DSO. It's easy to let your fees stagnate, potentially leaving money on the table.
Review your current fees against industry standards and local competition. Consider factors like inflation, increased supply costs, or new technologies you've implemented that might justify fee adjustments.
The reason we advocate for doing this quarterly is because small, regular increases are often more palatable to patients than large, infrequent jumps.
Treatment Plan Evaluation
Beyond financials, your quarterly planning should include a thorough evaluation of your treatment plans and follow-up procedures.
Are patients completing their recommended treatments? If not, why?
This review can uncover issues with patient communication, financial barriers, or scheduling difficulties that may be impacting your practice's productivity and patient care quality.
Technology and equipment needs should also be on your quarterly planning agenda.
New items are coming to market every day that can improve patient care and practice efficiency. That said, it’s important to not upgrade for the sake of upgrading.
Assess your current equipment: Is it meeting your needs? Are there new technologies that could enhance your services or streamline your operations? While major purchases might be part of your annual planning, identifying needs quarterly allows you to budget and prepare effectively.
Patient satisfaction and retention rates provide valuable insights into your practice's performance from the patient's perspective. Review patient feedback, survey results, and retention statistics. Look for patterns or trends that might indicate areas for improvement in patient care, communication, or office processes.
Your quarterly planning sessions are a perfect time to review and adjust your procurement strategies. It’s frequent enough that you can make decisions that’ll impact your practice quickly without acting on imperfect information.
With three months of inventory data to analyze, you can get a much clearer picture of whether your current suppliers are meeting your needs in terms of quality, cost, and reliability. This is an opportunity to negotiate better terms with existing suppliers or explore new options that might offer better value for your practice.
Like your monthly sessions, each quarterly session should result in a clear action plan with specific goals and strategies for the coming months. By dedicating time to this level of strategic planning, you're setting your practice up for long-term success and continuous improvement.
While monthly and quarterly planning keep your practice running smoothly, annual planning is where you set the course for your practice's year over year success. This is a prime opportunity to take a bird's-eye view of your practice, assess your progress, and map out your strategy for the coming year.
Here’s how you should structure these conversations.
Start with a Strategic Review
Begin your annual planning session with a comprehensive review of your practice's performance over the past year. This should include:
Use this information to conduct a thorough SWOT analysis (Strengths, Weaknesses, Opportunities, Threats). This exercise will help you identify areas where your practice excels and where there's room for improvement.
Set Comprehensive Goals
With a clear understanding of your practice's current state, it's time to set goals for the upcoming year. Be sure to make these goals SMART (Specific, Measurable, Achievable, Relevant, Time-bound). Consider setting:
Expert Tip: Aim for a mix of ambitious and realistic goals. Include 3 large goals that will significantly impact your practice, 3 medium goals, 3 smaller, easily achievable goals, and 1 stretch goal that pushes your practice to new heights.
Financial Planning and Budgeting
Your annual plan should absolutely include a detailed budget and financial forecast for the coming year.
This process should involve:
Remember to factor in potential industry changes, such as new regulations or technological advancements, that might impact your financial planning.
Make space to talk about your team’s performance and work-life goals as well. Use your annual planning session to:
Marketing Strategy
The end of the year is the best time to develop a comprehensive marketing strategy for the year ahead. A few things you should include in your conversation:
Technology and Equipment Planning
While this is something that you may be looking at quarterly, be sure to work in larger investments or longer term plans into your annual conversation.
Do your due diligence for any new tech you decide to bring in. It should enhance your practice's efficiency and patient care, not just be a shiny new toy.
Patient Care and Service Offerings
Consider how you can enhance your patient care in the coming year:
Procurement and Vendor Relationships
With a full year’s data to work from, you should use your annual planning session to take a deep dive into your procurement strategies. In particular, you should be paying attention to:
Implementing Your Plan
Once you've developed your annual plan, break it down into quarterly and monthly goals. This will help you stay on track throughout the year and make your plan more actionable.
Don’t feel like your annual plan is set in stone.
Regular reviews during your monthly and quarterly planning sessions will allow you to adjust your strategy as needed, ensuring your practice remains agile and responsive to changing circumstances.
Successful dental practices are going beyond just reacting to changes. They're anticipating and preparing for them. Your planning sessions are your opportunity to do just that.
If you’re looking for a way to take your planning up a notch, consider leveraging Method's comprehensive procurement platform.
With Method, you can easily track and analyze your supply costs against production, providing invaluable data for your financial planning and budgeting. Our platform's robust reporting features allow you to dive deep into your procurement strategies, helping you identify cost-saving opportunities and optimize vendor relationships.
Talk to a Method expert today and see how our solution empowers you to make more informed decisions during your planning sessions, ultimately driving your practice's efficiency and profitability.
October 24, 2024
It goes without saying that exceptional patient care and clinical excellence are paramount for successful dental practices.
But as savvy practice owners and managers know, that’s only part of the story.
Supporting those endeavors are streamlined back office activities such as procurement. In fact, strategic supplier management can significantly impact the bottom line and overall efficiency of their operations.
Enter the multi-supplier approach – a powerful strategy that can revolutionize your dental practice's procurement process.
Adopting a multi-supplier approach involves working with multiple vendors to source your dental supplies and equipment. Rather than relying on a single supplier for all your needs, you source certain product types from certain vendors selectively based on what works best for your practice (which we’ll get into in a moment).
This strategy creates a competitive environment that can lead to better pricing, improved service quality, and increased flexibility for your practice.
Many dental practices hesitate to adopt this approach. There’s often fear that this shift might complicate their procurement process or strain supplier relationships. However, when implemented correctly, the multi-supplier approach can do the opposite. That means streamlined operations and stronger, more mutually beneficial partnerships with your vendors.
To truly appreciate the value of the multi-supplier approach, it's important to understand the potential drawbacks of relying on a single supplier, known as single-sourcing.
One of the most significant risks of single-sourcing is gradual price increases over time, often referred to as "price creep." When a supplier knows they're your sole source, they may slowly raise prices, knowing you have no immediate alternative. These incremental increases might seem small at first but can significantly impact your bottom line over time.
Single-sourcing can lead to complacency on the part of the supplier. Without competition, they may have less incentive to innovate, improve their service, or offer competitive pricing. This "comfort zone" effect can result in stagnation in product quality and service levels.
Relying on a single supplier leaves your practice vulnerable to any issues that particular supplier might face. If they experience stock shortages, financial difficulties, or service disruptions, your practice could be left scrambling to find alternatives, potentially impacting patient care and practice operations.
Working with multiple suppliers offers a powerful solution to the pitfalls of single-sourcing.
By engaging multiple vendors, dental practices create a competitive environment that naturally motivates them to offer their best prices and services. This competition drives better pricing across the board, as suppliers vie for a larger share of your business through special discounts, bulk pricing, or other incentives.
The knowledge that they're competing against other vendors often pushes suppliers to improve their own service quality. You might push suppliers to offer faster delivery times, better customer support, or more flexible terms.
That may happen over time but in the near term the biggest benefit is cost savings. Different suppliers often specialize in or have better pricing for certain types of dental supplies or equipment. By strategically splitting your purchases among these vendors, you can optimize your spending across all categories.
For instance, you might find that Supplier A offers the best prices on disposables, while Supplier B excels in dental equipment. This approach allows you to leverage each supplier's strengths and ensure you're getting the best value for every item you purchase.
Furthermore, maintaining relationships with multiple vendors provides valuable flexibility in your procurement process. You can take advantage of various promotions and discounts offered by different suppliers, shifting your purchasing to capitalize on special offers for products you regularly use. This adaptability not only helps you save money but also ensures you have backup options in case of stock shortages or other supply chain issues. If one supplier is out of a critical item, you can quickly turn to another to fill the gap, minimizing disruptions to your practice operations.
While these benefits are excellent for any dental practice, it's crucial to strike the right balance. Working with too many suppliers can create logistical challenges, increase administrative workload, and potentially dilute the benefits of supplier competition.
For most dental practices, the sweet spot is typically 2-3 suppliers. This number allows for healthy competition while keeping the management process manageable. Larger practices or Dental Service Organizations (DSOs) might work with up to 4 suppliers to accommodate their more complex needs.
When determining the optimal number of suppliers for your practice, consider factors such as:
Looking to get started implementing a multi-supplier strategy? Here's a step-by-step guide to help you implement it effectively:
Start by analyzing your current purchasing patterns. Identify your top spending categories, frequently ordered items, and any pain points in your current process.
Research and create a list of potential suppliers that can meet your needs. Look for vendors with strong reputations in the dental industry, competitive pricing, and a track record of reliable service.
Create a set of criteria to evaluate potential suppliers.
This might include factors such as:
Develop a standardized process for soliciting and evaluating bids from potential suppliers. This ensures fairness and allows for easy comparison of offers.
Once you've selected your suppliers, negotiate contracts that clearly outline expectations, pricing, and terms. Develop an onboarding process to integrate new suppliers into your procurement workflow smoothly.
You should revisit your arrangements with each of your suppliers every quarter. There are always new products, better products, and less expensive products coming to market, so your approved product list (or formulary) should be continuously evaluated and optimized.
While the multi-supplier approach offers numerous benefits, it's not without its challenges. Here are some common issues and strategies to address them:
Some suppliers may understandably resist the move to a multi-supplier model, fearing a loss of business. Be transparent about your goals and emphasize that this approach can lead to more focused, mutually beneficial relationships.
Working with multiple suppliers can potentially lead to variations in product quality. Mitigate this by clearly communicating your quality standards and regularly talking with your team about product performance.
Initially, managing multiple suppliers may increase administrative tasks. Invest in a solid procurement platform for dental practices which can minimize this burden over time.
If your practice has been sticking with a single supplier up until this point, implementing a multi-supplier approach is definitely a major shift.
Making this change requires careful planning and ongoing management but the potential benefits far outweigh the challenges.
With the right approach and tools, even small to mid-sized practices can leverage the power of multi-supplier procurement to save money and position your practice for long-term success and growth.
October 4, 2024
Step into a successful dental practice, and there's a sense of energy in the air.
There are phones ringing off the hook, patients waiting to be seen, staff bustling about to keep everything running smoothly — and this is just the tip of the iceberg of a successful practice.
Behind the scenes lies a complex network of back-office tasks that keep the practice running smoothly. From tracking down the right suppliers to managing insurance claims and patient payments, the behind-the-scenes work is just as crucial as the patient care itself.
The last thing anyone wants to worry about is a cumbersome accounts payable process. Many practices resort to putting portions of their AP on autopilot by having invoices auto-paid via their practice credit card.
Credit cards have a time and a place for use in business. That said, while it seems convenient to use a credit card whenever a supplier invoice lands on your desk, this habit can lead to a host of problems down the line. In this post, we'll dive into the pitfalls of using credit cards for supplier payments and explore how dental practice accounting can be transformed through smart automation.
It's tempting to simplify your accounts payable process by using a company credit card for all your supplier payments. After all, it means one less task on your never-ending to-do list, right?
But before you put those invoices out of sight and out of mind, it's crucial to understand the potential risks involved.
Loss of financial control
This is the single, biggest risk of using a credit card to manage supplier payments.
With no reconciliation or scrutiny over invoices from suppliers, it's all too easy to lose track of expenses and accumulate debt.
You could be missing out on credits, chargebacks, and other financial benefits simply because it's hard to keep track of all the moving pieces when everything is lumped together on a credit card statement.
Moreover, credit cards make it easier to lose sight of how much you're actually spending each month. This is a problem for single-location practices and only becomes more severe as more locations enter into the equation.
Seemingly small charges compound and can quickly balloon into a significant sum, leaving you with an unexpectedly high bill at the end of the billing cycle. This lack of visibility and control can be detrimental to your dental practice accounting and overall financial health.
Cash flow issues
Cash is the lifeblood of any business. It is the key to sustaining your business as well as facilitating any growth opportunities.
Yet relying on credit cards for supplier payments leaves your practice open to so many potential cash flow issues. This includes things like interest charges, unpredictable payment amounts, and the hassle of reconciling statements. It's easy for your cash flow to take a hit.
Before you know it, your practice credit card could have missed or late payments which will have a ripple effect on your practice's financial standing.
Late fees and interest charges add up as quickly. Trying to catch up with these balances then becomes a puzzle of payments in the sense of “who gets paid when”. This runs the risk of damaging your relationships with suppliers and your credit score.
What’s worse is should both cash and credit become an issue, it puts your entire business at risk.
Less bargaining power
Using a credit card to pay suppliers could be costing you more money than just interest and payment fees. You could be diminishing your bargaining power by not dealing directly with your supplier.
When disputes arise or you need to negotiate payment terms, having a credit card company involved in the middle will definitely complicate matters. You may find it harder to resolve issues directly with your suppliers when you have to go through the credit card issuer first.
On the flip side, paying suppliers directly often comes with perks like early payment discounts or access to promotional items. Vendors may even prefer direct payment methods to avoid the fees associated with credit card processing. By cutting out the credit card middleman, you can strengthen your supplier relationships and potentially score some great deals for your practice.
Accounting issues
Relying on credit cards for dental practice accounting can create a bookkeeping nightmare.
Credit card statements will lump everything all in one statement. It's hard to verify whether you've received the correct orders when all you have to go on is a generic line item on your statement. This lack of clarity means you'll likely end up spending hours manually reconciling your accounts, hunting down missing information, and trying to identify potential double payments or missed payments.
Reconciling these charges within your accounting or bookkeeping software can become a mess. The result is a cumbersome reconciliation process that's far more time-consuming compared to other payment methods like checks or ACH transfers.
Not only is this a massive drain on your time, but it also leaves more room for error and could even lead to additional scrutiny during audits.
Using a credit card may seem convenient but as we've explored in the previous section, this approach can lead to a host of challenges if you simply set invoices to autopay using your credit card. So what’s the alternative? Fortunately, there are several. Let's take a closer look at three of these options.
ACH or electronic payments
ACH or digital transactions are likely familiar and likely the reason you switched to using a credit card instead. Yet they are still one of the most effective alternatives to credit card payments. While ACH (Automated Clearing House) may be viewed as making the process more manual, the range of benefits can’t be matched by a credit card
For starters, using ACH can reduce the fees you’re paying whether those are interest, late payment, or even individual transaction fees. Credit card fees can range from 1.5% to 5% of the transaction amount, depending on the card type and merchant agreement. In contrast, ACH fees are typically just a flat per-transaction fee, often under $1.
The more transactions you complete switching back to ACH, the more you can potentially save.
Electronic payments also give you more control over the timing of your transactions. You can schedule payments in advance, ensuring that you never miss a due date and helping you maintain positive relationships with your suppliers while also maintaining cash where your business needs it.
Finally, ACH removes one of the inherent headaches of reconciling credit card transactions. Each line item provides clear and detailed information about each payment. This makes it simple to match payments to invoices and reduces the risk of errors or discrepancies in your accounting records.
Payment plans: negotiating favorable terms and discounts
One lesser known alternative to consider is negotiating payment plans with your suppliers or lenders. By proactively discussing your financial needs and preferences, you may be able to secure more favorable terms that benefit your practice in the long run.
For example, some suppliers may offer early payment discounts if you agree to settle invoices within a specific timeframe. These discounts can help you save money on your purchases while also improving your cash flow. Similarly, negotiating quarterly or bi-annual payment plans can help you spread out your expenses and better manage your budget.
Some suppliers may even offer credits for unused supplies or promotional discounts for bulk purchases. By taking advantage of these opportunities and maintaining open communication with your vendors, you can optimize your accounts payable process and reduce overall costs.
These are less possible to negotiate should you just leave their invoice on autopay.
Financing directly with suppliers
Depending on your situation, it could be worth considering the option of financing directly with your suppliers. This approach can streamline your accounts payable process by eliminating the need for intermediaries like credit card companies or third-party lenders.
When you finance directly with a supplier, it becomes much easier to track what items were received and what payments are associated with each purchase. This direct relationship simplifies the reconciliation process, as you have a clear line of sight between your orders and your financial transactions.
Moreover, financing directly with suppliers can help you build stronger, more transparent relationships with your vendors. By working together to establish mutually beneficial payment terms, you can foster a sense of partnership and collaboration that extends beyond transactions.
While alternative payment methods like ACH and supplier financing can help you avoid some of the pitfalls of relying on credit cards, they don't address the root of the problem.
The truth is, you likely turned to credit cards in the first place because your AP process was taking up too much time and you or your team was looking to automate it. While automating some or all of your procurement processes does take a bit of time, it can reap rewards far beyond that initial investment.
Following these steps can free up countless hours and mental energy that you can reinvest into growing your practice and delivering top-notch patient care
1) Understand the current state
The first step in revolutionizing your AP process is to understand where you’re starting from.
That means refining your existing AP process – or creating one from scratch if you don't have a standardized system in place. Part of this process involves clearly defining roles and responsibilities within your organization.
Unlike other tasks that can be split among team members, accounts payable management thrives on consistency and accountability. If you don’t already have a department or designated person handling AP, a major part of this step is to change that. Assigning dedicated staff to handle AP duties can go a long way toward improving your dental practice accounting.
If your existing staff can’t handle such a shift in workload, consider bringing in a new person or organization that can be focused on accounts payable activities only. Should you choose to build your AP function within your practice, these team members will also need the right tools to complete these duties but we’ll get into that in just a moment.
2) Map out your accounts payable processes
Once you have your team in place, it's time to take a hard look at your AP processes. Ask yourself questions like: What’s costing our team the most time? Where are the biggest opportunities to improve our cash management? What have we been missing?
This sort of analysis is where the real magic happens.
By establishing clear, consistent procedures for every step of the accounts payable journey, you can eliminate confusion, reduce errors, and pave the way for successful automation.
While we don't have the space to dive into the nitty-gritty details of AP best practices here, the key takeaway is this: effective AP functions are built on a foundation of standardized processes.
From PO generation to invoice approval and payment processing, every step should be carefully mapped out and optimized for efficiency. This is also the perfect opportunity to identify areas where your current process may be falling short.
Are invoices getting lost in the shuffle? Are approvals taking too long? Do you struggle with cash flow management?
By pinpointing these pain points, you can target your automation efforts where they'll have the greatest impact.
3) Choose a function to automate
The fastest, most effective route to having success in automating your AP function is starting small. It’s difficult but resist the temptation to dive into complex overhauling of your entire finance system before you've proven the value of automation on a smaller scale.
By focusing on a well-defined project, you can avoid getting bogged down in the intricacies of shaping a comprehensive platform without fully understanding its practical application.
For example, let's say you've identified accounts payable as a prime candidate for automation. Rather than attempting to overhaul your entire AP process from day one, start by automating invoice processing or payment approvals. With the ‘what’ figured out, it makes it that much easier to figure out the ‘how’ which is the technology you will use.
4) Adopt the right technology for the problem
With your people and processes identified and mapped out, the right software can take your AP management to the next level.
You should look for solutions that can seamlessly integrate with your existing systems, standardize your PO and invoice management, and offer robust reporting capabilities. The goal is to find tools that work together to create a cohesive, efficient AP ecosystem – not just add more complexity to your plate.
For instance, Method Pay is purpose-built for dental practices like yours, offering a user-friendly platform that automates every step of the accounts payable process. From digital invoice capture and 3-way matching to custom approval workflows and seamless ERP integrations, Method makes dental practice accounting a breeze.
Running a dental practice has so many moving parts. It's understandable that many practices have turned to credit cards as a quick fix for automating supplier payments.
Credit cards absolutely have their time and place and should be used correctly and responsibly. Strategically taking advantage of points or using them to extend cash flow are two such instances.
However, don’t let the short term benefits lead to a host of long-term problems that jeopardize the financial health and sustainability of your business.
Solely relying on credit cards for automating supplier payments exposes your practice to unnecessary risk, accounting headaches, and cash flow issues that may impact the sustainability of your business.
Take the time to clearly understand your current challenges. Identify the areas where automation can have the greatest impact and you can set your practice up for long-term success.
Ready to experience the power of AP automation for yourself?
Request a free demo of Method today and discover how our innovative AP solution can help you save time, reduce errors, and take control of your cash flow. With Method’s AP solution, you'll be able to focus on what really matters: providing exceptional patient care and growing your practice.
October 3, 2024
If your answer is the latest dental chair or 3D imaging system, you might be overlooking a critical piece of the puzzle: your procurement process. Whether you're running a single practice or overseeing a Dental Service Organization (DSO), the right software powering your back office can make or break your bottom line.
For practices seeking guidance on adopting software, we’ve created The Ultimate Guide to Buying Software for Dental Practices. Inside we cover a comprehensive six-step process for dental practices to purchase software that’s not just an expensive line item but helps grow your business.
Curious what’s inside? Here are 3 takeaways from our guide.
First things first. Before you even think about signing on the dotted line for new software or changing your procurement strategy, you need to know exactly what problem you're trying to solve. Without a clear picture of what you are solving for, finding the right software or tool will leave you with an expensive headache.
The best way to go about this is to talk to your staff. Is your scheduling system a nightmare? Are you drowning in supply costs? Or maybe your inventory management is as accurate as a blindfolded archer?
Whatever the issue, it's crucial to pinpoint it precisely. Here's what that looks like:
Here’s an example:
"We have a problem of going over budget on supplies every month at each location. To solve this problem, we need to drastically reduce our supply spending and create a formulary (a preferred product list) that applies to all locations. This will save us thousands of dollars a month in supply spend and reduce time spent ordering supplies."
This simple exercise will keep you focused throughout the buying process. Once you’ve clearly defined a problem, whether inventory management or otherwise, it’ll become that much easier to evaluate solutions.
Any addition to your practice’s workflow goes far beyond what you’re hoping to accomplish today. Each investment should be one for long-term success.
Choosing software that can scale with your growth helps avoid finding yourself back at square one sooner than you think. For instance, if you don't ever plan on offering Teledentistry at your practice, investing in a practice management solution with robust teledentistry tools wouldn't be a wise investment.
Understanding what your ROI will eventually look like starts with establishing a clear budget for that initial purchase.
When determining your budget, consider:
Next, create a ranked list of your software needs. Your problem statement will help guide the core issues you’re looking to fix but think broader. Many platforms supporting dental practices offer myriad features that can help support your organization.
For instance, is top-notch customer service a must? Do you need comprehensive training for your team? Prioritize these needs – they'll guide your search in the next step.
You don’t want to find yourself in a position where you’re overlooking the importance of certain capabilities. Otherwise you’ll find yourself several months in with software that doesn’t quite fit the bill.
Scalability in dental software means it can handle your needs today and expand as your practice grows. It's not just about adding more patients or locations. It's about adapting to new technologies and evolving industry standards.
Let’s say you’ve gone through the process of understanding the problem and what you’re hoping to spend to solve it. From there it’s a matter of identifying the solutions that fit both those criteria – and that’s an exceptional first step!
But now it's time to get everyone on board. Depending on the size of your practice or DSO, there could be several stakeholders you’ll need to have on board including (but not limited to):
Depending on the size of your practice, this list could go on to include legal, marketing, individual practice managers, and more.
For that reason, it’s important you share your findings from the previous steps with these stakeholders. Alignment is crucial. Skip it, and you might hit a wall later in the process.
Another key consideration is integrations, which is why your IT people are your good friends here. One of the biggest challenges facing just about every single business is having a bunch of powerful software tools that don’t play nice with each other.
This includes scenarios where your Practice Management System (PMS) needs to integrate smoothly with your financial software, such as Sage Intacct or QuickBooks. For instance, after a patient visit for a root canal and crown, your PMS records the procedure codes, details, and handles the billing.
However, for comprehensive financial management, this information should also transfer automatically to your accounting software. Additionally, many practices use Patient Communication Software that works hand-in-hand with the PMS to enhance patient engagement and streamline administrative tasks. Ensuring all these systems work together seamlessly is crucial for efficient practice management and accurate financial reporting.
If you don’t have the right people or systems involved from the get go, it can cause plenty of issues, slow down adoption, and worst of all, potentially lose valuable team members in the process.
Upgrading any aspect of your dental practice’s operations isn't just about shiny new toys. It's about solving real problems, future-proofing your business, making smart financial decisions, and bringing your team along for the ride.
Take it one step at a time, and before you know it, you'll be running a practice that's the envy of the dental world.
Interested in all the insights our guide has to offer? Download the full guide now and take the first step towards a more efficient, profitable, and patient-friendly future.
August 16, 2024
If you think accounts payable is just about paying bills, it's time to reconsider.
Thanks to both internal and external factors, many dental practices continue to struggle with cash flow. This makes it harder to grow and puts additional stress on everyone involved.
The key to solving this pressing issue lies in rethinking how your accounts payable process works. It doesn’t matter if you're a small, single-location practice or a growing multi-location operation, automating your AP function can reshape how your practice approaches both financial strategy and decision-making.
The results are tangible benefits that extend far beyond the accounting department including improved cash flow, focusing resources on revenue generating activities, and more.
In this article, we'll explore how rethinking your approach to AP can enhance your financial reporting, improve decision-making, and ultimately contribute to the growth and success of your dental practice.
While accounts payable is a critical function for any business, many dental practices are still stuck with inefficient, outdated processes. This includes a heavy reliance on manual data entry and processing. Staff members often spend hours inputting invoice details, a task that's not only time-consuming but also prone to errors.
Based on research and averages across industries, for every 10,000 data entries people make would commit between 100 and 400 errors. To use a more specific circumstance, let’s say your practice orders regularly from three separate suppliers.
When closing the books each month, your staff needs to:
As practices grow, this clearly isn’t sustainable. Manual AP processes can potentially work for a single-location practice will likely buckle under the increased invoice volume of a multi-location operation. More locations means more invoices which requires more staff all of which increases the chances of errors occurring.
Many practices attempt to avoid this problem entirely and simply put those suppliers on autopay using a practice credit card which is a mistake in its own right.
The best solution isn’t to use a credit card but to resolve the root cause of the issue: inefficient AP processes. This is where automation steps in and the impact can be huge.
By leveraging technology to streamline AP, dental practices can transform their financial reporting and decision-making processes to be more forward thinking and geared for practice growth.
Enhanced Accuracy and Efficiency
One of the most immediate and impactful benefits of AP automation is a drastic improvement in accuracy and efficiency.
If we use the same rule of 10,000 data entries, instead of 100 to 400 errors, automated systems would make between 1 and 4.1 errors. Once the system is set up, AP automation systems come equipped with intelligent features that pre-fill fields with vendor information, pricing, and automatically carries over other invoice details. For newly submitted invoices, features like optical character recognition (OCR) can automatically read invoices and log the correct data in the system.
This not only removes human error from the process but ensures consistency and accuracy across all transactions.
The efficiency gains are particularly notable for multi-location dental practices. With a centralized AP automation system, practices can process invoices for all locations from a single platform, streamlining operations and providing a unified view of expenses across the entire organization. Centralization eliminates the need for separate AP processes at each location, saving time and reducing the potential for discrepancies between different office locations.
Moreover, AP automation significantly reduces the risk of duplicate payments, a common issue in manual systems. The software can automatically flag potential duplicates, saving practices from costly errors.
Another powerful feature of AP automation is three-way matching. With so many steps between quote to paid invoice, there are many opportunities to miss crucial information along the way. Systems equipped with three-way matching can compare purchase orders, invoices, and proof of delivery, ensuring everything lines up perfectly. Any discrepancies are immediately flagged for review, dramatically reducing the risk of overpayment or fraud. For dental practices juggling multiple suppliers and complex orders, this feature alone can save countless hours and prevent situations like paying for supplies that never arrived.
Oftentimes, practices will be able to drastically reduce the time from receipt to payment from weeks to days. This speed goes a long way toward building a quality relationship with vendors and could lead to added advantages such as better pricing or priority service compared to other practices.
While important, this approach is about more than just preventing errors. No matter what the size of your practice, time saved through automation means resources can be directed elsewhere.
Better employee experience and productivity
For most dental practices, wearing multiple hats is the norm. But when it comes to finances, too much overlap can spell trouble. AP automation helps you implement proper controls without hiring a whole finance department.
With automated workflows, you can ensure that the person who approves an invoice isn't the same one who processes the payment. This separation of duties is a key factor in preventing fraud and errors, giving you peace of mind and making sure any potential auditors are pleased.
Consider a typical three operatory dental practice. Often, the dentist or a single office manager handles everything from patient care to bill payments. They might approve invoices, process payments, and reconcile accounts – all while trying to focus on patient care. This setup, while common, leaves the practice vulnerable to potential errors or oversights.
These problems aren’t just for small practices. Multiple locations only exacerbate the issues.
By implementing AP automation, such a practice can set up a workflow where one person, say the office manager, reviews and approves invoices in the system. Once approved, the system automatically routes the payment for processing, which the dentist can quickly review and authorize with a click. This simple change adds a crucial layer of oversight without complicating day-to-day operations.
Moreover, any staff members who were previously bogged down with manual data entry and invoice processing can now focus on more strategic tasks. This shift in responsibilities opens up new possibilities for practice growth and improved patient care.
Improved financial visibility and control
Practices that lack visibility into their accounts payable processes are more prone to cash flow issues. This is caused by an inability to clearly see where and when their money's going out.
Making your AP process faster and more efficient through technology comes with the added benefit of allowing your team far more insight into the financial health of the organization. Since all the information and data will be accurate and centralized within a single system, it won’t be isolated to spreadsheets living on one team member’s desktop.
This is important because most AP automation platforms for dental practices will be able to give your practice more visibility through built in reporting tools.
Your practice should be able to effectively track and measure improvement of vital AP metrics such as:
Then, coupled with data from your procurement system, you can start to identify trends and spending patterns from various angles. This might include examining spending across different product categories, vendors, or time periods. For instance, you’ll be able to better spot pricing changes over time with certain suppliers that might be cause for renegotiating.
These sorts of insight go beyond just looking at past history.
Tracking these metrics are invaluable for budgeting and forecasting into the future and managing your cash flow. By having a clear view of upcoming payments, practices can optimize their payment timing to coincide with cash flowing into the organization.
This visibility allows practices to then make the most out of stocking up in times of a strong cash position or or to strategically timing payments to maintain optimal cash reserves.
Strengthening Compliance and Audit Readiness
Let's face it: audits aren't exactly a walk in the park. But for many dental practices, especially larger DSOs, they're an unavoidable reality.
Whether it's for regulatory compliance, financial due diligence, or just good business practice, being audit-ready is crucial. This is where automated systems can really shine, turning a stressful, teeth chattering experience into a breeze.
Gone are the days of rifling through filing cabinets for legacy records prior to an audit or scrolling through endless spreadsheets and systems. AP automation creates a real-time, digital breadcrumb trail for every transaction. Want to know who approved a payment and for what amount? That’s all neatly logged for you and easily accessible.
This level of detail isn't just about keeping auditors happy (though it certainly does that). It's about giving you a clear picture of your practice's financial health at any given moment. You can see the entire lifecycle of an invoice, from receipt to payment, with just a few clicks.
Another added benefit of this level of insight is fraud prevention.
Finally, there’s the consideration of either expansion, investors, or perhaps even selling your practice down the line. Having your financial house in order is crucial. Having comprehensive, easily accessible financial records that clearly demonstrate your practice's health and efficiency make all the difference in any process requiring due diligence.
Imagine being able to pull up detailed spending reports, vendor payment histories, and cash flow projections at a moment's notice. That's the power AP automation puts at your fingertips. It transforms your financial data from a headache into a powerful tool for strategic decision-making and growth planning.
Get started with AP automation with Method
Streamlining your accounts payable process is more than just paying the bills. You're freeing up valuable resources, gaining deeper financial insights, and positioning your practice for growth.
This modern approach to AP transforms a once tedious task into a resource to make strategic business decisions so you’re able to grow your practice, your way.
Ready to see how AP automation can revolutionize your dental practice's financial operations?
Take the first step towards a more efficient, accurate, and growth-oriented future by requesting a demo of Method Pay today.
Don't let manual processes hold you back any longer! Experience firsthand how our platform can help your practice smile all the way to the bank.
July 25, 2024
Running a dental practice is demanding. Between patient care, scheduling, and staff management, the last thing you need is a procurement nightmare. But lost invoices, disorganized spending, and supplier confusion can quickly turn into a financial black hole. Here at Method, we know your pain. That's why we're revolutionizing dental procurement with our brand new Reports & Analytics feature. Imagine This: No more scrambling for data. No more wondering where your money goes. Method unveils nearly unlimited insights of your practices purchasing, presented in a way that's clear, concise, and actionable.
Method's Reports & Analytics aren't just pretty charts and graphs. We provide pre-built dashboards for a quick overview, but you can also delve deeper. Our user-friendly interface allows you to:
Method understands the importance of teamwork. Our reports can be effortlessly exported and automatically delivered to key personnel, ensuring everyone is on the same page.
Continuous Improvement: The Key to Long-Term Success
Track key metrics, gather feedback, and refine your procurement strategies based on real data. With Method by your side, you can continuously optimize your processes and achieve long-term financial success.
Stop Procurement Headaches in Their Tracks
Say goodbye to the days of frustration and wasted resources. Method's Reports & Analytics are your one-stop shop for clear, actionable insights that empower intelligent procurement decisions.
Are you ready to transform your dental practice's financial health? Get started with Method today!
April 1, 2024
The field of dentistry has witnessed remarkable advancements in recent years, propelling it into a future filled with the continuous evolution of technology, the dental industry is on the cusp of a digital transformative that holds the potential for unthinkable improvements.
From advanced cosmetic procedures to minimally invasive techniques, dentists now have an array of options to cater to diverse patient needs, not only enhancing oral health but also contributing to overall well-being and self-confidence.
Cutting-edge technologies play a pivotal role in shaping the future of dentistry. From digital imaging systems that provide precise diagnoses to 3D printing technology that enables customized dental restorations, these advancements have revolutionized treatment planning and execution.
As we stand here on the threshold of this transformative era, improvements are on the horizon that allow patients to expect faster and more comfortable dental procedures with reduced recovery times. We, the dental care professionals, will benefit from enhanced diagnostic capabilities and improved treatment outcomes, expanding access to quality dental care.
The dental industry's journey from its traditional roots has been nothing short of remarkable. Let’s explore:
The field of dentistry is undergoing a remarkable transformation with the advent of digital technologies. Digital dentistry encompasses a range of advancements that are revolutionizing how dental professionals diagnose and treat patients. Key among these advancements are digital impressions, 3D imaging, and computer-aided design (CAD), which have become integral to diagnostics and treatment planning.
Digital impressions have replaced traditional putty-based impressions with a more accurate and comfortable alternative. By using intraoral scanners to capture detailed images of the teeth and gums, dental professionals can create precise virtual models that can be used for various purposes, such as orthodontic treatment planning or fabrication of restorations.
3D imaging has emerged as a powerful tool in dentistry. Cone beam computed tomography (CBCT) scans provide detailed three-dimensional images of the oral structures, allowing for more accurate diagnoses and treatment planning. This technology is particularly useful in implantology, where it enables precise placement of dental implants.
Then, there is computer-aided design (CAD), which has transformed how dental restorations are created. Dental professionals can design and fabricate crowns, bridges, and other prosthetic devices with CAD software and milling machines with unparalleled precision. This improves the fit and aesthetics of the restorations and reduces turnaround time for patients.
Adopting these digital technologies in dentistry holds immense potential for improving patient outcomes and enhancing the overall dental experience. Leveraging these advancements in diagnostics and treatment planning processes, dental professionals can deliver more accurate diagnoses and personalized treatments tailored to individual patients' needs while minimizing discomfort during procedures.
It’s clear that digital technologies will continue to play a pivotal role in shaping the industry. Dental practices that embrace these advancements will be at the forefront of providing high-quality, efficient, and patient-centric care and secure stability as we move into the future.
A fascinating development that is gaining traction is tele-dentistry. This concept takes inspiration from telemedicine and applies it to dentistry, allowing for remote consultations and follow-ups. The implications of tele-dentistry are far-reaching, not only enhancing accessibility for patients in remote areas but also facilitating timely advice and preventive care.
Tele-dentistry bridges the gap between patients and dental professionals who may be geographically dispersed. Through virtual consultations, individuals can seek expert advice without physical travel, saving time and resources. This is extremely beneficial for those residing in underserved areas where access to specialized dental care is often limited.
Dental professionals can now provide timely advice and preventive care via tele-dentistry. Leveraging video conferencing and digital imaging technology, we can remotely assess oral health conditions, offer guidance on oral hygiene and treatment practices, and monitor progress. This is a highly proactive approach that empowers patients to take control of their oral health while minimizing the risk and potential complications.
Patients with busy schedules or mobility limitations can now easily connect with their dentists from the comfort of their own homes or workplaces. As we know, flexibility promotes regular check-ups and early intervention when necessary, ultimately contributing to improved overall oral health outcomes.
As digital dentistry continues to evolve, tele-dentistry stands out as a promising advancement that enhances accessibility, provides timely advice, and promotes preventive care.
Advances in biotechnology have paved the way for groundbreaking techniques in regenerative dentistry. Stem cell research, for instance, has shown promising results in harnessing the regenerative potential of these cells to restore damaged dental tissues. By utilizing stem cells derived from various sources, such as dental pulp or bone marrow, researchers are exploring their ability to regenerate teeth and gums.
Tissue engineering is another exciting area within regenerative dentistry that utilizes biotechnology. Scientists have been developing sophisticated biomaterials that can serve as scaffolds to support tissue growth and regeneration. These biomaterials mimic the natural environment of dental tissues, providing a framework for cells to proliferate and differentiate into functional tooth structures.
The integration of biotechnology into regenerative dentistry holds immense potential for patients who have suffered from tooth loss or gum disease. Instead of relying solely on traditional restorative methods like implants or dentures, this emerging field offers a more holistic approach by stimulating the body's natural healing processes.
While there is still much research to be done, the progress made thus far in biotechnology and regenerative dentistry is undeniably promising. As technology advances, we can anticipate further breakthroughs that will revolutionize dental care and provide patients with more effective treatment options for repairing and regenerating damaged oral tissues.
In the realm of oral health, precision medicine is paving the way for a new era of treatment plans. We are now harnessing the power of an individual's genetic makeup and oral microbiome data. Dentistry is embracing a more personalized and targeted approach to care.
Precision medicine in oral health considers the unique genetic variations that influence an individual's susceptibility to certain dental conditions or diseases. By analyzing this genetic information, dentists can tailor treatment plans to each patient's needs, optimizing outcomes and minimizing potential risks.
Let’s not forget that we are now also considering the intricate relationship between an individual's oral microbiome and overall oral health. The oral microbiome refers to the diverse community of microorganisms that reside in our mouths. Dentists can gain valuable insights into how specific microbial compositions may contribute to various dental conditions by studying this complex ecosystem.
As we combine genetic analysis with oral microbiome data, precision medicine enables dentists to develop targeted interventions that address the root causes of dental issues rather than just treating symptoms. This approach enhances treatment efficacy and promotes long-term oral health and disease prevention.
Precision medicine will continue to advance in the field of oral health, and we can expect to deliver more personalized treatment plans tailored to each patient's unique genetic profile and microbial composition. This transformative shift holds immense promise for improving outcomes and revolutionizing traditional approaches to dental care.
You didn’t think we were going to get through this without talking about AI, did you?
The integration of AI into dental diagnostics is absolutely revolutionizing the field by improving the accuracy and efficiency of identifying oral health issues. With the help of advanced AI algorithms, dental professionals are now analyzing dental images with greater precision, detecting abnormalities, and aiding in the early diagnosis of conditions such as cavities and periodontal disease.
Dentists can rely on more objective and consistent analysis of dental images, nearly eliminating human error and ensuring a higher level of accuracy in diagnosing oral health problems, saving valuable time and allowing for prompt treatment planning and intervention.
AI is helping us identify subtle signs or patterns that may go unnoticed by human observation alone. We are allowing machines to evaluate vast amounts of data from various sources to recognize even the most minute indicators of potential issues, enabling early detection and prevention and restorative practices to begin as early as possible.
The integration of AI in diagnostics has the potential to enhance patient care by providing dentists with comprehensive insights into a patient's oral health history. Analyzing previous records alongside current diagnostic data, AI systems assist dental professionals in making more informed decisions regarding treatment plans tailored to each individual's specific needs.
While AI is undoubtedly transforming the world of dental diagnostics for the better, it is important to note that it does not and will not replace human expertise. Rather, it acts as a powerful tool that complements the skills and knowledge of dental professionals. The collaboration between artificial intelligence and human practitioners holds the key to improving diagnostic accuracy while delivering optimal oral healthcare outcomes for patients.
In recent years, the world of oral care has witnessed a remarkable transformation with the advent of smart dental devices such as smart toothbrushes, flossers, and connected orthodontic devices, that are revolutionizing personal oral hygiene routines and paving the way for a more proactive approach to dental health.
Smart toothbrushes are equipped with advanced sensors and technology that can track brushing habits in real-time, providing users with valuable feedback on their brushing technique, and ensuring that every corner is thoroughly cleaned. These devices often pair with companion mobile apps that offer personalized recommendations and reminders for optimal oral care. We are even seeing some of these apps providing doctors with true data about self administered patient oral care.
Similarly, smart flossers have emerged as an effective tool in maintaining healthy gums and preventing gum disease by utilizing cutting-edge technology to enhance traditional flossing methods. With features like pressure sensors and motion tracking capabilities, they guide users through proper flossing techniques while collecting data on their flossing habits.
Connected orthodontic devices have absolutely transformed the landscape of teeth straightening treatments. Integrating Bluetooth connectivity and sophisticated algorithms into braces or aligners, these devices have enabled orthodontists to remotely monitor patients' progress. This not only reduces the need for frequent in-person appointments but also allows for more accurate adjustments based on real-time data collection.
The data collected by these smart dental devices is not only beneficial to patients but also provides valuable insights to dental professionals. Dentists can access comprehensive reports on their patients' oral hygiene routines and identify areas that require improvement or intervention. This data-driven approach allows you to deliver more personalized treatment plans and better overall oral health outcomes.
As smart dental devices continue to evolve and become more accessible, we will be watching them transform how we approach oral care. Combining convenience, technology, and data collection capabilities, these devices empower individuals to take control of their dental health while fostering a closer partnership between patients and dental professionals.
The future of dentistry is undoubtedly exciting, with a convergence of technological, biological, and personalized approaches. As the dental industry continues to embrace innovation, patients can look forward to more efficient, comfortable, and tailored oral care experiences. I have another blog on the comparison of dentistry to the restaurant business.
In the ever-evolving field of dentistry, the advent of technology has brought about a significant transformation. Gone are the days when dental treatments were limited to basic procedures. With the technology boom, dentistry's menu has expanded exponentially, offering patients a wide range of options.
From digital advancements like 3D imaging and CAD/CAM technology to regenerative therapies such as stem cell research and tissue engineering, the landscape of dentistry has been revolutionized. These advancements have improved treatment outcomes and enhanced patient experience and comfort.
As we continue to witness advancements in technology and regenerative therapies within dentistry, it is clear that the landscape is evolving at an unprecedented pace. With technology as a valuable ally in managing these options effectively, we can provide our patients with cutting-edge treatments while ensuring optimal oral health outcomes.
Dr. Wu received his DMD from Tufts University School of Dental Medicine. Dr. Wu continued training in Advanced Education in General Dentistry Residency at UCLA which included implants, veneers, and full mouth reconstructions.
Dr. Wu has lectured in multiple courses at the Yankee Dental, Texas Dental Conference, and Ontario Dental Association since 2008.
Dr. Wu was in an article featured in June 2019 Dentaltown Magazine on an “Own the Business side of Dentistry”
Dr. Wu completed Henry Schein’s Dental Business Institute.
Dr. Wu is the clinical director of Onsite Dental care providing mobile dentistry to the assisted living communities across New England.
Dr. Wu currently owns Emerson Dental, a Multi-Specialty practice in 2 locations Westford, MA and Bedford, MA.
He has embraced digital technology having integrated both Sirona CBCT and CEREC Primescan, and consulted with companies Pearl AI, Bola AI and Method to improve the outcomes through technology
His practice has a strong focus on the patient experience, he has won Reader Choice Awards and Angie Super Service Awards.
February 26, 2024
Are you neck-deep in your end-of-year reporting, working weekends pulling together data for next year’s budgeting process and questioning whether the data you can get is complete, or even accurate?
If you are responsible for leading the financial planning activities for your organization, this time of year can be grueling, frustrating, and just a little stressful. What makes this whole process even more difficult is when you don’t have access to the information needed to make informed decisions. When that data sits in many different and siloed locations and is hard to get your hands on, this process can take days or even weeks.
What if you had the ability to see where every penny spent on supplies had gone? What if this included who spent it, where, when, and on what? What if you could view spend information by practice or location or role? How sharp would your forecast be if you could analyze data. By product category, supplier or time period? What if you could see what was purchased on formulary or off?
What if all of this information was centralized in a single location, being pulled in from across your entire enterprise in real-time? Would this make it easier and faster to make decisions?
This is exactly how Method enables financials leader to do more. We give you all the tools you need to make the best decisions and drive financial gains, instead of spinning tire trying to get to the data.
Let’s make 2024 a year of action. Let Method give you a tool that enables you and your leadership team to make decisions that could save your business tens or even hundreds of thousands of dollars, next year, and every year after.
In the world of financial planning for dental service organizations, the adage "knowledge is power" couldn’t ring truer. As the industry matures, strategically savvy DSOs are evolving from driving growth purely through acquisition to putting more emphasis on same-store growth.
To successfully make this shift, it is critical to be able to parse out performance metrics with a great deal of precision and flexibility. Access to comprehensive, precise data on buying behavior, forms the bedrock of informed decision-making, directly impacting the efficacy and success of financial strategies. The quality of decisions made about future spending strategies is only as good as the data on past spending behavior used to inform them.
This article explores how access to accurate data makes it easier to maximize savings from rebate programs and guide your private-label buying strategy. We also look at the role of standard operating procedures (SOPs), and the importance of establishing benchmarks to guide future financial decisions. Finally, we will examine how e-procurement solutions can directly impact the ability to accomplish specific goals associated with same-store growth.
With management consultant Greg Mahoney from our industry partner Skytale Group, let’s look closely at how e-procurement can enhance your access to critical information, enabling you to make data-driven decisions and fortify your financial planning in 2024.
The key factor that distinguishes successful financial planning from arbitrary decisions is the ability to leverage comprehensive and accurate data. By analyzing past spending behavior, dental service organizations can predict future trends, identify cost-saving opportunities, and streamline financial operations. This data-driven approach empowers organizations to make precise forecasts and allocate resources more efficiently and Method is the special sauce that delivers the data to you on a silver platter.
A pivotal aspect of financial planning for dental service organizations involves procurement and purchasing decisions. When dental service organizations have easy access to complete and accurate data, they gain a nuanced understanding of their spending behavior. This insight enables the optimization of spending strategies, ensuring resources are allocated to the most impactful areas. Let’s look at a few examples:
One of the key benefits of having access to complete and accurate data is the ability to maximize rebates from different suppliers. By thoroughly analyzing past spending behavior, Dental Service Organizations can identify opportunities to negotiate better terms, such as volume discounts or extended credit periods, as well as leveraging bulk buying strategies. A comprehensive understanding of historical purchasing patterns equips organizations to strike deals that yield better discounts and increased rebates, positively impacting the bottom line.
Visibility into buying behavior provides DSOs with a distinct advantage in optimizing spending on private-label supplies, particularly in non-clinical, disposable, and consumable categories. With comprehensive data at their disposal, organizations can make informed decisions about when and how to best allocate resources to these supplies. This insight allows for strategic planning, ensuring that funds are effectively channeled towards high-quality private-label supplies without compromising on costs.
Easy access to a platform aggregating financial data across multiple practices and locations saves invaluable time and resources. Rather than manually collecting data from various sources, a centralized platform eases the burden of financial information collection. Greg Mahoney from Skytale Group commented, "This time-saving aspect enables the financial team to focus on analysis and strategy development, fostering more efficient and effective decision-making."
The ability to sort financial data by category significantly streamlines analysis. This feature is especially beneficial for individuals without a clinical background who might not be familiar with the intricacies of dental products. Categorization simplifies the process, enabling quick and informed decision-making, thus enhancing overall financial planning efficacy.
Understanding industry benchmarks for performance metrics is essential for gauging organizational performance against industry standards. Developing internal benchmarks enables the comparison of future results against current performance, aiding in goal-setting and performance evaluation within the organization
This provides context and helps in identifying areas for improvement as your organization evolves and establishes higher standards and new KPIs. In order to drive continuous improvement, it’s important to have a solution in place that allows you to customize what metrics you monitor and aggregates that performance data for you. This enables you to easily compare against historical performance and monitor progress toward future goals
Establishing, monitoring, and reinforcing clear guidelines for future spending behavior forms the bedrock for the financial health of companies, particularly those in growth mode. These SOPs act as the backbone for financial governance, ensuring consistency, adherence to financial regulations, and optimizing spending behavior, aligning actions with organizational goals.
The Skytale Group team emphasizes the importance of procurement SOP implementation to involve clearly defined approval processes for expenditure, standardized guidelines, and policy frameworks for negotiating contracts. For instance, a comprehensive SOP might dictate the process for evaluating and selecting vendors, thereby ensuring transparency and compliance in supplier negotiations.
Once you have identified the buying behavior that will drive financial performance, the next challenge is ensuring that behavior becomes the norm across your enterprise. The implementation of standardized procedures serves as a key factor in driving financial discipline and fiscal responsibility within organizations, especially during expansion phases. Consistent and clear guidelines are instrumental in shaping spending behavior, ensuring transparency, and fostering a culture of financial prudence and accountability. This is where e-Procurement really becomes the execution arm for any procurement department. Utilizing Method becomes the structural tool that reinforces SOPs unilaterally across all locations.
The success of financial planning for Dental Service Organizations hinges on being able to maintain visibility into and control over buying behaviors. The ability to enforce these behaviors as SOPs is crucial, as they are, in reality, the execution of your strategy. A powerful e-procurement platform gives you both the needed visibility to set your strategy and the control to ensure it is executed properly.
Interest rates remained high throughout 2023 and there is no indication that they will be dropping in 2024. This means there is less capital available to DSOs for acquiring new practices. Skytale Group’s Greg Mahoney shared that many DSOs, and their investors, will be focusing more of their attention on increasing revenue from their existing locations. Same-store growth figures allow you to see what percentage of a practice’s sales revenue is coming from growth in existing locations versus revenues from the acquisition or opening of new locations. Accurately tracking same-store growth will become a requirement as DSOs mature and the pace of acquisitions slows.
To accurately measure same-store growth (SSG), you first need to be able to calculate the revenue that each of your existing locations generates over a specific period of time. Using a robust e-procurement solution to track your spend across all locations, month-to-month, quarterly or YoY, will make this task much easier.
Here are a few tips on how to maximize SSG:
With access to the right data, it’s easy to identify where there is room to adjust pricing structures and secure more favorable terms. By having visibility into purchasing across all of your locations, you’ll be able to see where you have the greatest leverage and how you need to adjust your purchasing patterns to increase it.
Integrating your various tech platforms to bring all your data together is a powerful enabler for making good decisions, faster. It also simplifies the process of testing new procurement strategies and easily analyzing the results, leading to greater profitability.
Did you know that every dollar you save is equivalent to approximately three dollars in production? Because of the expenses associated with chair work (staff, equipment, supplies), only one of three dollars in production contributes to your EBITDA but every dollar save through better pricing goes directly to your bottom line.
In the fast-evolving landscape of dental service organizations, the importance of leveraging comprehensive and accurate data cannot be overstated. The ability wield this data requires the assimilation of e-procurement software into the financial planning framework. Such tools provide clarity on past spending behaviors to sort and analyze massive amounts of information.
Best practice dictates a need for real-time access to spending snapshots, drill-down capabilities into focus areas, and the utilization of benchmarks, both industry-based and internal, to enhance the financial planning landscape. These tools and benchmarks empower DSOs to navigate complexities, make informed decisions, and foster continued growth in the competitive dental industry.
If you would like to learn more about creating efficiencies in your DSO, contact our partners at Skytale Group to help build a roadmap to continued growth and scaling of your business. Reach out at greg.mahoney@skytalegroup.com or visit their website www.SkytaleGroup.com.
February 12, 2024
You probably aren’t expecting this, but I’m going to say it anyway. We need to recognize the commonalities between dentistry and the restaurant industry. Why? Because dental professionals can draw inspiration from the world of hospitality to enhance the patient experience that they’ve grown to expect from the hospitality industry. We can incorporate elements such as personalized service, attention to detail, soothing environments, and even innovative techniques used in food presentation into their practices.
Ultimately, by embracing these similarities between seemingly unrelated fields like dentistry and the restaurant industry, dental professionals have an opportunity to elevate their patient experience by providing not only exceptional oral care but also an enjoyable visit that leaves a lasting positive impression.
Here are some points to consider:
Both dentistry and the restaurant business place a strong emphasis on customer experience. Just like a fine dining establishment strives to create a memorable dining experience for their patrons, dentists aim to make their patients feel comfortable and well-cared for during their visits. From warm greetings to soothing ambiance (well, as soothing as a dental office can be), both industries understand the importance of creating a positive customer journey.
Let's remember the overall experience. Going to a high-end restaurant is not just about satisfying your hunger; it's about indulging in an immersive dining experience that leaves you feeling satisfied on all levels - taste buds included! Similarly, visiting the dentist isn't just about getting your teeth checked; it's about receiving comprehensive oral care that leaves you feeling confident and healthy.
It is important to highlight that precision plays a crucial role in both the dentistry and restaurant industries. In the culinary world, chefs meticulously measure ingredients and closely follow recipes to achieve culinary perfection. Similarly, dentists also prioritize precision when performing intricate procedures or crafting dental restorations. Both fields demand a keen attention to detail and an unwavering commitment to delivering exceptional results that meet the highest quality standards.
In today's competitive market, customization and personalization have enhanced customer satisfaction and success. This is true in the hospitality and retail industries and in professions like dentistry.
Similar to how a chef tailors a dish to suit a customer's preferences or a fashion designer creates custom-made clothing based on individual measurements and style choices, dentists also provide customized treatment plans based on each patient's unique needs.
By personalizing services, you can ensure that your patients receive the most effective and suitable treatments for their oral health conditions. This tailored approach improves patient satisfaction and increases the likelihood of successful outcomes.
Furthermore, customization and personalization create a sense of trust and confidence between dentists and their patients. When individuals feel their needs are being understood and addressed individually, they are more likely to establish long-term relationships with their dental care providers.
Customizing and personalizing services in dentistry play a crucial role in enhancing overall satisfaction and success. Practitioners who tailor treatment plans to match individual preferences and needs foster stronger patient relationships and achieve more positive outcomes in oral health care.
Readers who want to learn more about trends in personalized services should read, “Good to Great: Why Some Companies Make the Leap and Others Don't,” by Jim Collins. Another great book I recommend is, “Extreme ownership: How U.S. Navy SEALs Lead and Win,” by Jocko Willink and Leif Babin.
Hygiene and cleanliness are paramount in various industries, such as restaurants and dental practices. In the food service industry, restaurants prioritize cleanliness to ensure food safety and prevent the spread of illnesses. They adhere to strict cleanliness standards, including proper handling and storage of ingredients, regular sanitization of cooking surfaces, utensils, and equipment, as well as maintaining clean dining areas.
Similarly, dental practices strongly emphasize hygiene to safeguard patient well-being. Dental professionals follow rigorous sanitation protocols to prevent cross-contamination and maintain a sterile environment. This includes sterilizing dental instruments after each use, using disposable materials when possible, regularly disinfecting treatment areas and waiting rooms, as well as practicing proper hand hygiene. I would venture to say that the Dental Industry isn’t given enough credit for how meticulously clean our environments have to be to ensure the best possible patient care. But we should always strive to go above and beyond in sterilizing our spaces.
A clean and hygienic environment promotes health and instills confidence in customers or patients. It demonstrates a commitment to safety and professionalism while minimizing potential health risks. Whether it's in the restaurant industry or dental practices, maintaining high standards of hygiene is essential for the well-being of both customers and staff alike.
An interesting parallel between restaurants and dental practices is the menu. Just as restaurants offer diverse menus to cater to various tastes and preferences of their customers, dentists also provide a wide range of services to address different oral health needs of their patients.
The ability of restaurants to offer a variety of menu options allows them to attract a broader clientele. On the flip side, the more specialized the menu, the more niche the customer. No matter what, they understand that not everyone has the same taste or dietary restrictions and therefore aim to provide options that cater to different preferences. Both diversity and specialization in their menus enable them to serve customers with varied tastes and ensure an enjoyable dining experience, even for the most particular pallets.
Similarly, dentists offer a range of treatments and services tailored to meet the specific oral health needs of their patients. Different individuals may have different dental issues or requirements - from routine check-ups and cleanings to more specialized treatments such as orthodontics or periodontal care. By offering a diverse range of services, or even niching down, dentists can accommodate the unique needs of each patient and provide the care their patients deserve.
Both industries recognize the importance of catering to individual preferences or needs in order to thrive in today's competitive market. By offering variety in their offerings - be it through menus or treatment options - restaurants and dentists are able to attract and retain a broader clientele base.
Understand your customers, and your patients, and deliver the services and care they need and want.
A great read I recommend is, “Quench Your Own Thirst: Business Lessons Learned Over a Beer or Two,” by Jim Koch. He says, “find one thing you’re great at, do it extremely well, and you don’t necessarily have to have so many options.”
Clear communication and education play a crucial role in both dentistry and the restaurant business. In the field of dentistry, effective communication is essential for dentists to educate their patients about oral health, treatment options, and preventive measures. By clearly explaining these concepts to their patients, dentists can empower them to make informed decisions about their oral care.
Now let’s look at the restaurant business- clear communication is vital for restaurant staff to educate diners about menu choices and ingredients. By providing accurate information about the dishes on the menu and any potential allergens or dietary restrictions associated with them, restaurant staff can ensure that diners have a pleasant dining experience while making informed decisions about their food choices.
In both industries, effective communication and education contribute to building trust between professionals and consumers. Dentists who effectively communicate with their patients help establish a strong dentist-patient relationship based on trust and understanding. Similarly, restaurant staff who provide accurate information about menu choices create a sense of transparency and reliability that enhances the dining experience for customers.
You have to not only facilitate informed decision-making but also foster professional-consumer relationships built on trust and confidence.
Learn to be a storyteller and give analogies so it's easy for others to understand. A great read I recommend is, “The Art of Explanation: Making your Ideas, Products, and Services Easier to Understand,” by Lee LeFever.
Dentists and restaurants are embracing technology to enhance their operations and improve the overall experience for their customers. In the dental field, digital tools are being utilized for diagnostics and treatments, allowing dentists to provide more accurate and efficient care. On the other hand, restaurants are adopting technology for various purposes such as reservations, order processing, and customer engagement.
Digital tools in dentistry include advanced imaging technologies like digital X-rays and 3D imaging systems, CAD system, and even ordering platforms like Method that save time and money, and allow your staff to get back to chair-side instead of stuck at a desk ordering from five different websites.
Restaurants have also embraced technology to streamline their operations.
Online reservation systems allow customers to book tables conveniently without the need for phone calls or waiting times. Order processing has become more efficient with the implementation of digital ordering platforms or mobile apps that enable customers to place orders remotely. This not only saves time but also reduces errors in order taking.
Furthermore, technology is being utilized by restaurants for customer engagement purposes. Loyalty programs integrated with mobile apps or online platforms incentivize repeat visits by offering rewards or discounts. Social media platforms provide a space for restaurants to engage with their customers through promotions, updates on new menu items, or responding to reviews.
By embracing technology, both dentists and restaurants can improve efficiency in their respective fields while enhancing the overall experience for their customers. Digital tools enable dentists to provide more accurate diagnoses and treatments while restaurant technology streamlines processes such as reservations and order processing. Ultimately, these advancements contribute towards creating a seamless experience that meets the evolving expectations of today's tech-savvy consumers.
My final tips on keeping up with the technological revolution happening in the Dental Industry is to stay involved with Study Clubs, CEs, and attend Conferences to get a pulse of what’s happening in Dentistry. As new Dentists it’s easy to isolate and get into a comfort zone and do the same thing over and over.
Study Clubs, CE, Conferences and sales reps to get a pulse of what's happening and new, as dentists it's easy to isolate and get into a comfort zone and do the same thing over and over.
Dr. Wu, a highly accomplished dentist, graduated from Tufts University School of Dental Medicine and furthered his education at UCLA with a focus on implants, veneers, and full mouth reconstructions. Renowned for his expertise, he frequently lectures at prestigious events such as the Yankee Dental and Texas Dental Conference, and was featured in Dentaltown Magazine for his insights into dental business management. Dr. Wu's leadership extends to his role as the clinical director of Onsite Dental Care, where he oversees mobile dentistry services across New England. As the owner of Emerson Dental, operating Westford and Bedford, MA, he champions the integration of digital technology like Sirona CBCT and CEREC Primescan, collaborating with industry innovators to enhance patient outcomes. Dr. Wu's commitment to excellence has earned his practice numerous accolades, including Reader Choice Awards, reflecting his unwavering dedication to providing exceptional patient care.
January 22, 2024
As your organization increases in size, scale and complexity, managing your procurement processes can start to feel like raking leaves in a thunderstorm. You have multiple offices, each moving in different directions, at varying paces, with their preferred products or suppliers, and inconsistent internal processes.
You must handle each of these scenarios differently to ensure you are successfully managing spend and driving efficiency across the entire enterprise. To succeed you need both greater visibility and control. You have to be able to see what is happening at each location and regulate behavior to be consistent.
At Method, we recognize the pivotal role procurement plays in securing the financial health of DSOs. Leveraging sophisticated tools, such as Method's specialized procurement and spend-management software, is crucial to achieving the level of cost control that will fuel continued growth.
We’ve put together 9 Key Performance Indicators (KPIs) that we recommend your procurement department rigorously track. Using Method’s advanced data and reporting tools, which include diagnostic and predictive analytics, you’ll have greater visibility into micro and macro spending behavior, be able to develop more accurate forecasts and easily identify inefficiencies and disconnected processes more accurately. With these powerful tools at your disposal, you can use these KPIs to take action to improve your organization's EBITDA by pinpointing and rectifying unnecessary expenses.
Efficiently aligning supply budgets with anticipated revenue is the cornerstone of effective dental procurement. Method's specialized software facilitates real-time tracking, allowing us to gauge whether each dental office adheres to, surpasses, or falls below the designated budget.
Having a supply budget is a start for those who are new to spend management. For those practices that have had consistent budgets for some time, having the ability to track additional dollars spent outside of the eProcurement platform. and documenting additional revenues, brings an additional level of accuracy to the mix.
Suppose a dental office sets a supply budget at 6% of its average monthly revenue of $100,000. If their average monthly revenue exceeds $100k they can spend more than $6k on supplies and still achieve their revenue-to-spend ratio goal. Method makes it easy to closely monitor this KPI so you can identify trends and make necessary adjustments to ensure optimal budget allocation despite revenue fluctuations.
Creating a formulary allows DSOs to achieve the primary goal of procurement which is to always buy the right items, at the right, time, in the right quantities at the best possible price.
Standardizing supply orders through a formulary ensures uniformity in product selection and pricing and should be used as much as possible. Any deviations from this protocol can increase the risk of paying higher costs, hampering the negotiation leverage that is gained through volume.
Use Method to better understand what your practices are purchasing at each location. Our platform allows you to use order histories to create "catalogs," creating efficiency in the ordering process and eliminating excessive searching for items. You can also use it to identify similar products that can be consolidated into a single preferred SKU and added to the formulary.
Method also allows you to set a default, so that formularies are viewed first by users. Depending on the preferences of each practice, we can "lock in formulary" (no office autonomy) or set formulary KPIs (% of spend) to reinforce formulary use. Review with some frequency to swap items to get the most out of pricing, manufacturer discounts, clinical decisions, etc.
Many practices offer what we’ve coined “soft compliance,” when enforcing the use of their formulary. This means there are some products (often non-clinical) where purchasing should be strongly suggested, if not mandatory, and other products (mostly clinical) where the provider is allowed some autonomy to order off formulary when they have a strong preference. Method's on/off formulary report provides valuable insights into these deviations, allowing us to promptly guide offices back to the approved formulary. Additionally, this report is a great indicator of what should be negotiated and added onto the formulary to capture the most leverage for a practice.
When leveraged with our Formulary Compliance tool, a practice can set KPIs for on-formulary spend to hold locations accountable, thus maximizing the amount of spend available to a practice for channeling into their negotiated items.
Method’s on/off formulary report makes it easy for you to identify when certain offices consistently purchase supplies outside the approved catalog. Now you can intervene promptly to ensure adherence to negotiated pricing and terms, fostering cost-effective procurement.
Structured procurement processes are essential to prevent pitfalls like small order fees, additional shipping costs, and additional costs of labor and burden in managing a larger volume of orders than strictly needed across all impacted staff (local offices, procurement, accounts payable, etc). Method’s order frequency report offers visibility into the order workflow, allowing you to streamline operations and guide offices toward synchronized and cost-effective procurement practices.
By analyzing order frequency, we ensure offices adhere to established guidelines for supply orders, preventing unnecessary expenses and promoting operational efficiency across the board.
Vendors often impose a fee on orders under a certain quantity. Consolidating orders into substantial bulk requests minimizes these small order fees and streamlines the procurement process. Method's small order count report, coupled with the order frequency report, gives you the insight you need to proactively engage with offices, emphasizing the benefits of strategic consolidation.
Utilize the small order count report to strategize and educate offices about the cost-saving benefits of consolidating orders, fostering efficiency, and reducing unnecessary fees
Efficient procurement hinges on timely supply deliveries. Monitoring transit times from order placement to receipt allows us to gauge procurement efficiency, hold suppliers accountable, and ensure uninterrupted operations.
Identify consistent delays from a specific distributor through Method's reporting tools. Collaborate with the distributor to improve shipping processes, preventing disruptions and maintaining a seamless supply chain.
For DSOs to fully maximize their rebate programs they must consolidate their ordering with suppliers, pushing as much volume as possible through a small, preferred set of manufacturers.
Use Method’s reporting to identify which suppliers you can most effectively centralize your purchasing with. Then, determine from which manufacturers you can source the largest number of items. Consolidating both suppliers and manufacturers will allow you to optimize the potential savings available through all rebate programs.
Costs can be hidden in specific areas. If your spend is exceeding projections, knowing exactly how much of your spend is going into different categories, and where it may differ from your projections, makes it easier to understand where you need to make adjustments to get back on track. Pairing categorical spend with our “alternative products” is an easy way to find similar products from other suppliers and/or manufacturers that do the job just as well.
Use Method’s Product and Price Analysis feature.
Buying “generic” is a great way to drive down costs and keep them low over time (sometimes to a 40% discount).
Method allows you to easily compare costs between multiple private label suppliers and to see how much of your inventory is being filled through private labels at each location. Method also makes it simple to switch out private label products in your formulary and make these changes by location, by practice or across the entire enterprise.
In summary, managing the procurement process at a growing DSO is challenging but, if done correctly, can contribute significantly to fueling the organization's success. A core part of your growth strategy is knowing what metrics to pay attention to and how to make the adjustments that will drive continuous improvement. By establishing baselines for these nine KPIs and monitoring them, you will have your finger on the financial pulse of the business. Using a powerful e-procurement solution like Method allows you to know how you are performing against both industry norms and your own internal goals and, more importantly, make data-driven decisions that will ensure you achieve your financial ambitions.
December 20, 2023
Although the exact procurement lifecycle for your dental organization may vary slightly depending on the size of your practice and the maturity of your processes, it's essential to understand each of the critical steps, what you could be missing, and how digitization can help.
The dental procurement lifecycle is the end-to-end process—each and every step—required in the purchasing of your dental supplies. An efficient standard process for buying the supplies required to service your patients is critical to the financial effectiveness of your dental organization. It ensures you choose the right supply partners, safeguard your business and optimize profits.
If you're looking to increase profits and scale, it may be a good time to reassess your current procurement procedures and start buying better.
The typical dental supply buying process involves:
For many dental offices, the entirety of the lifecycle process continues to be managed manually, reliant on emails, phone calls, supplier portals, and yes, even fax machines. When leveraging technology, the process is streamlined, efficient, and effective, empowering you to make the most advantageous buying decisions for your practice.
Buying smart and implementing best practices throughout the procurement lifecycle enables you to:
And by leveraging automation to procure your dental supplies effectively, you ease the burden on employees so they can spend their time and efforts doing what they do best, taking care of patients.
Let's take a look at each of the steps and the power of a procurement platform to transform how you work.
The goal of procurement is to buy:
→The right product
→In the right quantity
→At the right time
→At the best possible price
The trick is, however, is to find the sweet spot. Buy too early or too much, and your cash flow takes a hit, and you risk the financial hits of wasted supplies due to loss, damage, or expiry. Buy too late or too little, and you risk stockouts, impeding service levels and production rates. Buy in a hurry and you risk errors, such as buying the wrong product, which can damage your quality of service, frustrate employees, or worse, put your practice at risk if products don't meet regulation standards.
Buying from the wrong supplier can also come with a host of risks, and if you pay too much, your profits suffer.
Manual processes rely mostly on guesswork or "gut feel" and are highly prone to human error and inconsistencies. Much like Goldilocks, employees learn what's "just right" through trial and error, purchasing reactively upon the sudden realization that you may soon run out and often get burnt in the process.
To avoid running out of supplies, rush orders are placed, resulting in extra costs associated with expedited shipments like faster deliveries. Opportunities to take advantage of quantity price breaks, amalgamate orders to reduce shipping costs, or even shop for more competitive pricing all go out the window, with your profits right behind them.
With the right procurement platform, the identification of needs becomes quite simple.
A digital inventory system allows you to easily keep track of what you have in good supply and what you're running low on and will let you know when it's time to order. By using barcoding and RFID tagging technologies, your dental office staff can quickly and easily perform an inventory count so you can buy confidently, knowing your stock levels are accurate.
Once you've established some purchasing history within the platform, procurement analytics offer you usage reports so you can fine-tune appropriate minimum stock levels and base buying decisions off of data rather than guesswork. These same analytics give you all the data you need to move on to the next step, submitting Request for Quotes (RFQs) to vendors.
Prior to selecting vendors to place orders with, you must first identify and pre-qualify a pool of suppliers to choose from. We understand you may have long-term relationships you value, but regardless of your procurement strategy, to ensure you receive the best possible price and service your organization deserve,s you'll want to periodically send out an RFQ to both current and potential new suppliers.
Connecting and establishing relationships with new suppliers through RFQs will put you in an advantageous position for negotiating with current vendors and creates a healthy competitive environment that puts you in the driver's seat when it comes to pricing. Having relationships and pricing established with more than one vendor also safeguards your business continuity as you can more quickly and safely react if your preferred supplier suddenly comes up with a supply issue.
Furthermore, you can ask vendors to lock in pricing for 3 to 6 months at a time, bringing stability to your supply costs along with cost savings.
To ensure you receive a good market-wide comparison of price and service, you'll want to put your supplies list out to bid directly with manufacturers as well as with every major dental supply distributor and smaller, more local distributors. Manually putting together and sending out an RFQ for your long list of dental supplies to that many suppliers can be extremely cumbersome and time-consuming, and that doesn't even include all the work of gathering and analyzing responses!
But don't worry—a digital procurement platform can help you every step of the way. A digital RFQ process can help you gather all pertinent information, including item descriptions, SKUs, manufacturer, item category, quantity, unit of measure, and of course, price per unit. Those selected to participate in the RFQ can easily enter their bid online through the procurement platform. Once all responses have been received all responses, Method's procurement platform can help you analyze prices with an apples-to-apples comparison.
Once you've compared pricing, you'll need to select your vendors.
However, RFQs aren't the only way to price shop. Method provides an Amazon-like shopping experience, where you can compare current pricing and availability from multiple authorized dealers, including web, negotiated, group, or DSO pricing.
The industry's most comprehensive cross-match of dental products, including private label items with a detailed product catalog of over 700,000+ dental supplies and with access to a 2,000+ dental-specific supplier database, guarantees you can find what you need at the best possible price.
But before simply jumping on the lowest price, it's prudent to stop and ask yourself some questions. How well do you know these suppliers? Are clinical evaluation trials required before purchasing? Do you hold trusted long-term relationships you would like to prioritize?
It may be worth revisiting the RFQ and offering your most preferred suppliers the opportunity to requote on the items where they were not competitive. Suppliers often just need a little nudge to sharpen their pencils and prefer to do so rather than lose out on business.
Now you should be ready to make your selections. Consider how many suppliers you want to work with, keeping in mind that every purchase order comes with its own costs. From issuing and placing orders to receiving shipments and paying invoices, each step of the procurement lifecycle takes time out of your employees' day and, therefore, comes at a cost.
As the procurement manager or dental practice owner, you'll want to give your employees some guidance or perhaps even set an official procurement policy for your staff to comply with. Whatever your strategy, digitizing the end-to-end procurement lifecycle with a procurement platform can help you implement it, including publishing, controlling, and analyzing formularies.
An order approval process helps leaders maintain financial oversight, ensuring purchases align with your policies and your budget.
While a manual approval process may have you struggling to gather what you need to make an afformed decision, Method's digital approval process delivers all the information you need to your fingertips, so you can approve orders based on data— like how you currently stand against your budget—and allowing you to avoid costly mistakes before they impact your bottom line.
By viewing all relevant quotes and comments associated with the order as well as a full cost analysis, you can avoid expensive errors, declining certain items on a request while still approving others. A fully transparent and digital approval process allows you to better collaborate with team members, keeping everyone in the loop and ensuring nothing slips through the cracks, and no requests are lost or forgotten while reducing unnecessary, incorrect, or duplicate orders, resulting in saving you money.
A purchase order serves as a legally binding request for the supplier to provide goods or services at the specified price, quality, quantity, meeting, and other requirements stated and is the next step in the procurement lifecycle. As the purchase order is legally binding, it's critical they be accurate and kept on file—something an automated procurement process is designed to do.
Method's digital procurement platform allows you to quickly and easily create a purchase order from an order request, prior orders, inventory status, or catalogs and will electronically submit orders directly to the necessary vendors. Automating the process reduces the chance for errors and delays by avoiding the opportunity for human error.
If you're running a manual procurement process, in order to know what has been delivered and what is still on its way, you'll need to track your status shipments through numerous supplier portals, phone calls, and emails. A procurement platform like Method's brings it all to you in a single location.
Prior to delivery, an online procurement platform like Method's can provide you with a summary chart, helping you monitor what has shipped and when you can expect delivery with online shipment tracking. As orders proceed along each step of the lifecycle, you can easily view receipt and invoice status for every order, all in one place, regardless of supplier.
When an order arrives, all shipment details must be validated for accuracy, confirming the right product (as per the purchase order and order confirmation) in the right quantity were delivered in good working order. If discrepancies or issues are found, it could cause problems and arguments with the supplier. To avoid invoicing issues, it's imperative they be noted and communicated to the supplier as soon as possible so you can hold suppliers accountable.
Comments can be added to each receipt, along with photos of the damage to support your claims. Having all proof and documentation in one place eases communication and can help ensure corrective actions such as the return of incorrect or damaged products are coordinated as required.
If the goods received match the delivery slip and align with what was ordered, supplies can be quickly scanned into the inventory management system and then placed in their correct location, remembering to use First-In-First-Out (FIFO) and placing the newest items farthest from reach. If quantities vary, the method allows you to record the actual quantity received for each item.
Whether purposely fraudulent or due to human error, invoice mistakes occur. To prevent improper payment, invoices must be compared to the physical receipt of supplies and prices compared to purchase orders. Having all your records in one place ensures you can easily validate what you need to before cutting that payment.
Record maintenance is critical in case of disputes, fraudulent behavior, or simply to verify data for your own internal purposes. A manual process reliant on a paper trail to be maintained by busy office staff is ineffective and time-consuming. With Method, you can easily view all documents related to a purchase, including order requests, purchase orders, receipt of goods, invoices, and payments, along with all comments, photos, and supporting documentation.
An end-to-end audit trail keeps everyone on the same page and ensures you maintain control of each step of the lifecycle for every order you place. Creating a streamlined, consistent, and scaleable ordering process that allows you to purchase your dental supplies with speed, control, and accuracy is vital to running an effective and efficient dental office and essential for profitable growth.
Designed and built to support the unique needs of a dental organization through streamlined, electronic tools, Method enhances existing relationships with dental supplier account managers and opens the door to new ones.
Regardless of where you're starting, if you're ready to take control of your procurement, Method offers flexible pricing so can revolutionize how you manage your spend and start improving your profits.
Start your transformation today.Get in touch with our team today or request a demo to see it for yourself.
April 25, 2023
Procurement is the low-hanging fruit.
Increasing revenue may get all the glory, garnering the attention of dental organizations looking to increase profits and scale—however, procurement is the low-hanging fruit it seems everyone keeps forgetting about, and to the great detriment of profits.
Driving patient traffic, clinical results, patient experience, case acceptance, marketing—offices looking to scale often focus on the revenue side of things. But if we take a moment to do the math, increasing production may come with limited results.
Let's say you grow your business to between $800 to $1million in production. IF you can grow to that number all without hiring, then after you pay some expenses, supplies, and other costs, the balance of that growth makes it to your bottom line.
But what happens if your business doesn't run effectively, or has simply reached its capacity, and to reach that $800 to $1million in production, you now have to hire new staff? Let's estimate that employees' salary at $50,000 per annum, that comes right of those expected profits. Worse yet, increasing revenue is a costly venture that comes with no guarantee. It's a roll of the dice, with your earnings on the line.
And that's just on the "soft" side of things.
But now, let's flip the script. Say you choose to focus on transforming your procurement processes, finding efficiencies while reducing the cost of your dental supplies? Well, suddenly, doing business costs you less. On the "soft" side, the day-to-day running of the business now requires less employee time, freeing up your staff to focus on increasing those production rates. On the "hard" side, your supplies cost you less, immediately improving your bottom line, and unlike revenue, it's dollar for dollar. So when you DO increase your production, that production is more profitable.
Suddenly, focusing on procurement seems to make good business sense, doesn't it? And best yet, it doesn't have to be either-or. If you have the resources, go ahead and improve your procurement practices while you strive for growth. Just don't forget about procurement, the low-hanging fruit, and sure bet that after a quick and easy implementation with a low barrier to entry guarantees improved profits and a fast ROI.
On that note, let's take a look at some of the key procurement performance metrics you should be monitoring so you can make sure to improve and fatten up that bottom line.
Overhead costs impact all aspects of your business. Want to know if you can afford to hire that new dental assistant, market your dental organization so you can increase revenue, or buy the dental supplies you need?
Estimating and forecasting your overhead costs should play a significant role in informing business decisions.
Non-labor expenses, such as dental supplies that are necessary for running a dental practice (referred to as overhead costs), are an integral part of your business plan, which is required to secure loans or grants from investors or loan institutions.
But what constitutes a "healthy" overhead cost, what do they consist of, and how can you calculate them?
Firstly, there are two types of overhead costs, fixed and variable. Fixed are, not surprisingly, fixed, meaning they do not change regardless of your production rates. They consist of things like salaries and payroll, office rent or lease, utilities, and administration costs such as accounting or legal. In other words, it's an expense related to the running of a practice that doesn't fluctuate. And as they don't vary, they're easy to budget and account for.
Variable expenses (you guessed it!) vary month-to-month. They include items such as dental and office supplies, services, and marketing costs. Due to their variability, variable expenses are more difficult to budget. A best practice is to take your average over your fiscal year and make any adjustments for known changes, such as the significant purchase of assets or large upcoming promotional events.
When it comes to your dental supplies, knowing your purchasing habits, supply requirements, and what you're likely to spend on a monthly basis empowers you to find opportunities for improvements, highlighting where you may be able to drive out costs and make better buying decisions for your business.
As we stated in The Dental Procurement Lifecycle Explained, it's important to consider how many suppliers you want to work with, keeping in mind that every purchase order comes with its own costs. From issuing and placing orders to receiving shipments and paying invoices, each step of the procurement lifecycle takes time out of your employees' day and, therefore, comes at a cost.
However, the number of suppliers you choose to work with affects your efficiencies, but it could also impact your supply costs. Manufacturers and distributors like to take advantage of economies of scale. Having reliable business, they can count on (and therefore make and buy products knowing it will sell) or streamlining logistics or other workflows allows them to work efficiently and, therefore, increase profits.
By controlling the number of suppliers you work with, you can better leverage your purchasing volumes through Request for Quotes (RFQs), negotiating special discounts, or simply buying at larger price breaks.
Knowing you're working with limited preferred suppliers, or worse, are single-sourced, gives little motivation to vendors to offer you better pricing and top service. To be frank, they're confident they're getting your business without it, so why would they bother? Creating the right strategic competitive supplier landscape ensures suppliers continue to fight for your business and offer you the best possible price to gain it.
To create this competitive environment while maintaining your efficiencies, we suggest sticking to 2-3 main distribution suppliers. By leveraging their purchasing power with a limited number of vendors, dental organization can get better pricing and more favorable contract terms and will establish themselves as an important customer suppliers, and are more likely to receive optimal service and security of supply, and generally get more support from suppliers.
As we began to explain above, there is a sweet spot when it comes to placing orders. While you want to take advantage of economies of scale and limit shipping and other service charges or minimum order requirements, you also don't want to impede your cash flow or risk the financial hits from damaged, lost, or expired supplies that come with over-ordering.
For many, the sweet spot is generally around 2 to 3 orders per month.
Tracking how much you order and how often, on an item level basis, allows you to plan for your requirements, ensuring you have enough room in your stock area or the available staff to do the receiving, for instance. The data also informs RFQs and allows suppliers to bid knowledgeably and sharpen their pencils as best they can.Knowing the number of orders you place is a standard procurement metric that allows you to identify room for improvement.
The dental supply chain can be a complicated one. Knowing how your dental supply chain works can help you mitigate your risks and build a strategic procurement plan that extracts the maximum value for your dollars and safeguards your organization against disruption.
Over the last couple of years, the dental industry has begun to feel the impacts of supply chain issues as manufacturers and their partners faced decreased production rates while demand continued to spike globally. As a result, demand for PPE and all the associated raw materials skyrocketed. For those not monitoring their delivery times or open purchase orders, production rates and service levels suffered.
Although most tend to think of full-service dealers and mail-order distributors as the main sources of supply, the market is much more complicated and carries varying risks and service levels- whether they stem from a global pandemic or one of the many other areas of risk.
This makes delivery times one of the most critical metrics to measure in order to mitigate risk.
You may have grown accustomed to your vendors regularly delivering in 1-3 business days, which should be the goal. However, if you don't pick the right partners with regional warehouses, you could get stuck with extended lead times and risk stockouts, putting your production rates and service levels at risk.
Measuring delivery times is a way to monitor supplier performance and ensure your vendors do their due diligence in assuring supply. From sourcing the raw materials required through the final manufacturing and delivery of the end product, supply chains can be long, intricate, and may cross many trade borders. And the longer the chain, the more opportunity for disruption to happen anywhere along the chain with severe reciprocal effects all the way down the line.
If your suppliers don't have the right contingency plans in place, your business could be at risk. Extended delivery times are a warning sign that something may be amiss, and if you've planned your ordering assuming average delivery times, you may find yourself in deep water. Simply put, keep an eye on delivery times because when your suppliers deliver matters—greatly.
Let's be honest; this one seems like a no-brainer. Yes, you should be monitoring your profits. But, as the old saying goes, you can't affect what you can't measure. At the end of the month, you should know what you've spent, what you've brought in, and how you're doing.
Monitoring your margins can help you see if you need to cut down on your inventory costs to increase profits. On average, here's what dental supplies should be costing you:
5% of Revenue- You're doing well
6% of Revenue- You're a little high. There may be some opportunity for improvement
7% of Revenue- It's time to address your procurement practices
Just as you monitor your patients' dental health through benchmarks and metrics that allow you to quickly assess how your patients are doing and where problems may lay, key procurement performance metrics allow you to see issues and identify priorities for effecting change.
The long-term viability of your dental organization is reliant on ensuring profitability and growth. By establishing benchmarks and setting targets, you can measure and improve its health, ensuring your organization is around to continue serving its patients with the best possible service for a long time to come.
Ready to optimize your procurement and inventory management with Method Procurement Technologies? It doesn't have to be complicated.
Give us a call to discuss or arrange a demo, and let us show you just how simple it can be.
April 18, 2023
As competitive as the Dental care space may be, in order to remain viable, it’s essential to remain profitable. So, we thought we would provide you with a toolbelt of revenue-generating solutions to have at the ready, so you can pry some more profits back into that bottom line.
With a little time and a little monetary investment, the strategies below could deliver a significant impact in increasing your dental organization’s revenue. However, there’s no one-size-fits-all formula for increasing profits. So, before jumping ahead, you’ll want to put together a plan of attack. We suggest you take some time to evaluate which options hold the highest potential to boost revenue for your practice and target those areas first.
Patients go to your dental office to receive care, and treating them in a professional but friendly and agreeable way ensures they enjoy their experience as much as possible and will want to return. Your employees are busy people and have a lot on their minds, but you want them to be accommodating to patients who may or may not be feeling so great, no matter how busy.
A dental practice can be a stressful environment. Although it’s always important to provide feedback on how people and the office can improve, it’s to maintain a positive atmosphere you must ensure they are also given praise or words of encouragement. And remember to celebrate any small wins. Positive daily feedback helps employees feel appreciated.
Spending time together as a group outside of the office can help break down barriers and make teams feel more united. It’s also another nice way to give back a little and motivate your employees to continue putting in their best efforts. Consider scheduling special outings. It could be something as simple as a dinner, or may try something a little more fun like an Escape Room, which is also great for team building.
Although it may seem counterproductive, make sure your employees feel listened to and have somewhere they can voice their discontent or let you know of serious problems that need to be addressed. To help them see the light at the end of the tunnel, it’s also a good idea to communicate any improvements you’re working on to the team.
Lastly, ensure you lead by example. Treat your employees well, and they’re more likely to treat your patients well.
Thanks to the global pandemic, people have learned to quickly embrace anything they can accomplish online. Dentistry is no exception. The more convenience you can offer patients, the more opportunities you create to increase revenue. In fact, InstaMed’s Trends in Healthcare Payments 11th Annual Report showed that 78 percent of respondents want contactless healthcare options and are more likely to visit a provider who offers them.
While, in many cases, a standard in-person appointment will be necessary in order to perform any dental care services, virtual appointments can help you kick off the relationship and take care of any conversational portions of patient care that don’t require the doctor or the patient to be in-person or face-to-face. Intake forms, pre-registration, and self-scheduling appointments are other ways to provide new and existing patients with more convenience while reducing the workload on your staff.
Nobody knows more about the excellent patient experience and care you provide than your loyal patients. This is why they make amazing referrals. Happy patients are usually happy to share their positive experiences with your practice with friends and family. And because the information comes from someone they trust, it’s likely to be more trusted than paid advertisements and can be a great avenue for increasing practice revenue.However, people are busy and, unless prompted, may not share their experience, no matter how great it was.
To ensure you maximize your referrals from existing patients, you’ll need to be proactive and make the ask. This can be done by giving out referral cards to patients during their visits, leveraging social media pages to provide links to review sites, or adding referral requests and links to emails.
Your current patient list may also be able to help bring in more patients. An incentive program that awards both existing and new patients with, for example, a discount on teeth whitening or a complimentary dental exam may help bring in new patients.
Also, don’t overlook your employees, but instead of relying on the goodness of their hearts, consider a bonus or incentive program for them as well.
To help encourage new patients to select your dental practice over the competition, you’ll want to create a company Google business page. To stand out, take some time to optimize the page and show off your practice’s personality with images and videos. Make sure to monitor the page and answer any questions, and include all the essentials, such as your practice name, address, and hours of operation.
Have a new service you would like to promote? Is there a topic patients are always inquiring about that you would like to share some insights on? Upload an article on the subject. Google’s My Business Page is a great way to engage with your patients that you don’t want to underutilize.
Chances are you likely already have a website, but when was the last time you updated it? Make sure your website represents your organization in the best light possible, is up-to-date, informative, and, most of all, easy to navigate. If you haven’t yet added a chatbot that can respond to new and existing client inquiries, you’re likely missing out on a huge opportunity to reel in that new potential patient that just landed on your website.
Videos are another great way to make a strong first impression and convert website visitors to patients. Help them “get to know” you and your staff and the services you provide, and perhaps tell them about a procedure or what their first visit would be like. It’s a great way to ease some of their concerns and establish more of a personal connection with your brand.
Patient trust is a critical factor in retaining and gaining patients, so reviews matter greatly. In fact, one survey found that 70% of patients said a positive online reputation was extremely important in selecting a healthcare provider.
Today’s consumers want to know what your patients think and are likely to check out your practice’s reviews. So make sure you closely monitor your social media and review sites and respond to complaints in a delicate manner and make it clear your practice takes the feedback seriously. Positive feedback and recommendations should be responded to as well and show you’re engaged and appreciative (and encourage more positive reviews!).
Have a long-term patient in for a visit? Ask them if they would be willing to leave you a positive review and maybe even encourage all patients to do the same through a sign at your front desk. You can even include a handy QR code that will quickly take them to your preferred social page or review site.
Expanding your services gives you a double whammy. Not only do you increase your chances of attracting more patients, but you can increase revenue with existing ones. Instead of fighting your competition with lower prices (a game nobody wins), offering a wider range of services allows you to stand out and avoids having to refer patients out.
Don’t forget to market your new services through your social channels and email campaigns. You could even offer a kick-off limited-time discount or run a social media giveaway campaign to help boost your online presence.Be responsive to patient needs. Perhaps you can widen your operating hours, increase the size of your practice so you can add more chairs and include more associates, or offer new specialties. Although you don’t want to over-extend yourself, now may be a good time for that growth plan you’ve been thinking about.
To increase the likelihood of patients accepting treatment options and maintaining their standard ongoing care, providing patients with a wide range of payment options is critical. Payment options could include cash, personal check, debit, credit, and special financing. The more flexible your payment options, the less likely personal financial circumstances will interfere with dental care decisions.
Seemingly small things heavily impact your revenue. You may be surprised to know just how much production time is lost through missed appointments, missing paperwork, or locating supplies. Take some time to review your processes and look for opportunities for improvement. Even minor improvements can add up to big dollars.
Prevent delays by having all paperwork ready ahead of time. Ensure all patient information, such as insurance information and patient history, is gathered before their scheduled appointment. Have patient records and referrals ready and waiting when the patient arrives and any necessary forms completed prior to the appointment time.
Clarify your policy for no-shows, ensure it is communicated to patients in as many ways as possible, and then stick to it. Missed appointments cost your practice money, so if you haven’t yet set a policy for cancellations, no-shows, and late arrivals, we suggest you do.You’ll want to do everything you can to help your patients make their appointments (send reminders ahead of time, offer flexible hours, etc.). However, if they do miss, although you have the option to offer a grace period and provide extra warnings, after this point, go ahead and charge re-offenders a penalty fee. This may help motivate them to abide by your policy moving forward.
If your daily schedule is continually running off course, try having patients complete a survey to help you identify bottlenecks. How long was their visit, and how much of it did they spend waiting in the reception or the exam room? Were they comfortable during their wait, and did they feel there was something that could have been done to improve or speed up their visit? To ensure you get an accurate picture, hand out the survey on different days of the week and hours of the day and across weeks. Your patients will be glad to see you value their time and look to improve your service.
Remember, long wait times represent an opportunity to boost efficiency and increase revenue. So although you may not be able to banish them altogether, the goal should be to reduce them as much as possible for your sake and the patients.
Procurement (the purchasing of your dental supplies) can potentially have a significant indirect impact on your ability to increase your revenue. By freeing up cash and your people's time, resources can then be better invested into growth plans.
If you’re looking to increase your revenue and safeguard your practice, pay attention to how you spend your dollars. And by purchasing the right supplies, you could improve your service.
Spend less, make more
No, cutting expenses doesn’t directly impact your revenue. But ultimately, the goal is really to increase profits, and that procurement does well. As we covered in The Impact of Buying Smart, every dollar you save in the purchasing of your dental supplies goes straight to your bottom line. What exactly does that mean? Well, to increase $1.00 in profits, you can either find $1.00 in cost savings or earn an additional $2.94 in revenue.
Lucky for you, you don’t need to choose. Better procurement can help support revenue growth too.
Increase operating efficiencies
Thanks to new cloud-based technology such as Method’s, buying smart can now happen a lot faster. By leveraging automated, streamlined processes, you can improve your operating efficiencies and free up your staff so they can focus on taking care of patients and bringing in more revenue using all the tips we offered above.
Alleviate cash flow and safeguard your schedule
With proper inventory management techniques and an intuitive ordering system, you can buy what you need when you need it, removing unnecessary and wasteful overbuying that erodes your cash flow and your profits. All without risking stockouts, so you always have the supplies you need to service your patients and maintain your efficiencies.
By freeing up cash flow and minimizing the waste that is incurred through damaged or expired products, you’ll have more cash available to scale your business and increase your production capacity.
Top-quality products, top-quality service
By more carefully selecting your vendors and having access to current market pricing and availability, you can ensure to carry the highest quality supplies and offer top-quality service.
Monitor to budget
Looking to grow and planning to lay out some capital? With Method’s procurement software, you can monitor purchases against budget and ensure you remain in control of spending and hit that budget, so you have the cash you need to grow.
Method Procurement Technologies can help you run an effective, efficient practice and make wise purchasing decisions that optimize your profits. Spend wisely, so you can increase revenue and scale profitably.
Ready for a personalized demo? Contact Method now.
April 11, 2023
As a dental organization, you want to provide the highest quality care for your patients. However, you may be overspending if you regularly purchase the newest equipment and technology for your dental practices. Improper budgeting may lead to inefficient inventory management, including shortages and excesses. Dental purchasing software can help you keep track of your inventory and spending to properly budget and optimize inventory management.
Here are three reasons why you may be spending too much on dental supplies.
Proper budgeting is crucial for your bottom line — spend analysis helps you estimate and compare revenue and expenses. Budgets are a way for your dental organization to set financial goals over a defined period and maximize profits and provide a financial guide for your practices so they can ensure to remain within budget. Dental practices typically include these common expenses in budgets:
When creating a dental practice budget, supplies should cover about 5% to 6% of revenue. When overhead costs begin creeping up toward 7%, it's time for your practice to re-evaluate by analyzing areas where you may be overspending.
Method's dental purchasing software can maximize your practice's productivity so you can measure orders against your budget. You'll be able to better control spending by preventing costly mistakes when ordering from suppliers and only buying what you need when you need to. Plus, dental purchasing platforms let you request quotes from several suppliers to find the best price. Analyzing historical data will also help you refine your financial policies to ensure your budget scales with your growing organization.
An essential step in budgeting is gaining an understanding of your current spending habits. Proper spend analysis will help you identify items you can cut out of your budget and where you can find less expensive alternatives. Typical areas where dental practices overspend include:
Although new technological advancements may seem appealing, before making a buying decision, make sure patients will notice and value how the care has improved. If the new equipment isn't going to help you gain or retain patients, you may choose to only purchase new equipment when it needs to be replaced or if it allows you to expand your services. Also, make sure to do your research, and buy the right products the first time.
Method's dental inventory management software tracks your inventory to automate the inventory and spending management processes and reduce overhead. You'll be able to create a stock list to track stock levels, preventing supply shortages and excess inventory that lead to lost revenue. Method's software allows you to start optimizing your inventory management.
Because spending analysis helps you identify where you can cut costs when reordering supplies, you'll be able to improve inventory management and only carry the inventory you need. Intuitive ordering systems will tell you when it's time to reorder supplies. Keeping accurate records is also crucial for analyzing which instruments and materials are most important for your practice's daily operations and will help you better understand what is involved in your day-to-day operations.
Stockpiling extra inventory in your office can impact your bottom line as well. Although you may be attempting to save time and money, ordering too much inventory can increase costs and create physical and operational bloat. It’s suggested you only order about a month's worth of supply, as buying in bulk can also lead to wasted assets just sitting on the shelf. Plus, goods could become expired or damaged when sitting on the shelves for long periods.
When ordering safety stock, take time to evaluate risks and streamline inventory management. Lean inventory management is a method to reduce costs associated with managing inventory. Inventory management becomes more efficient, focusing on continuous improvement to increase value and profits. Lean inventory has five principles:
End-to-end inventory management software automates inventory tracking to ensure accurate inventory counts. Using software will free up your team so they can spend less time manually tracking inventory and more time caring for patients. You'll optimize stock levels to streamline reordering. Inventory management programs help you be proactive when supplies are running low.
If you're tired of overspending on dental supplies and materials, Method is here to help. At Method Procurement, we share your goal of increasing efficiency at your dental organization to help your bottom line. Your practice will experience both hard and soft cost savings with our easy-to-use dental purchasing software. Contact us today or request a demo to learn how our software can increase efficiency and target overspending!
April 4, 2023
With the rise of Dental Service Organizations (DSOs), increased investor attention, and a new focus on EBITDA, dental organizations are under more pressure than ever to build scalable infrastructure that ensures efficiencies, controls spend, and decreases overhead costs.
We take a look at the seismic industry shift that should have everyone, from single-office practitioners to large DSOs, paying attention to their EBITDA.
As supply costs escalate and the labor crisis wears on, the need to focus on improving margins through lowering costs and doing more with less has increased. Fueled by the impact of Covid-19, as financial pressures (and student loans) continue to mount, dental practitioners have begun to realize the advantages of the DSO model, with its trending popularity quickly gaining traction.
DSOs offer dental practitioners welcome relief from the pressures of running and maintaining the business side of a dental practice. By having a DSO manage the business and administration side of a practice, rather than spending their own valuable time on business functions that dentists don't necessarily have the knowledge, education, or ability to handle effectively, they can enjoy a stable salary while remaining focused on providing quality patient care.
According to Inside Dentistry, “DSOs continue to increase their market share across the United States. In the race to expand, some are offering to pay amounts that are five to nine times practices' earnings before interest, taxes, depreciation, and amortization (EBITDA), which can be tempting to almost any practice owner.”
As they continue to attract the attention of investors with a healthy rate of return on their investments, DSO growth isn’t about to slow down. The American Dental Association predicts DSOs will more than triple their current market share by 2035.
DSOs, Chief Financial Officers (CFOs), and dental practitioners have finally realized that a dollar saved is a dollar made. But with the rise of DSOs, that savings could now lead to much, MUCH more.
Lowering overhead costs with improved spend management not only improves your profits but can significantly increase the value of your business.
When it comes to margin-improvement initiatives, dental practitioners have the typical knee-jerk response of obtaining new patients and working longer hours so they can treat more patients and increase revenue.
While the approach can work and may lead to some financial growth, it is far from fail-proof and has a limited impact on driving the bottom line. Unlike savings, where every penny you save is a penny gained on your financial statement, all revenue gets a hefty chunk taken out of it to cover overhead costs, including the costly marketing campaigns it takes to increase revenue, so only part of that revenue actually makes it to your bottom line.
Unfortunately, today, many dental organizations are operating with extremely high overhead costs, impeding profitable growth.
Average practice overhead runs at 66%, so for every dollar of revenue, 66 cents goes towards funding business operations (for dental practices, overhead costs are considered all costs not associated with dentist income, including rent or mortgage, employee compensation equipment, supplies, and equipment.)
To put that into perspective, this means that every $1.00 saved in overhead yields the same profit as increasing production by $2.94. So, even a small reduction in overhead can yield significant increases in profits without having to increase production.
Overhead costs and procurement practices significantly impact your EBITDA, the primary yardstick used by investors in determining the market value of dental practices.
Aegis Dental Network offers an example whereby focusing on EBITDA rather than collections and positioning his practice as a DSO partnership opportunity, one lone practitioner was able to sell his practice for more than $4.5 million, which was over 170% of collections and $2.7 million more than the $1.8 million (70% of collections) he was originally told to expect.
This was able to happen because the dentist ran an efficient, lean practice that generated $2.6 million in revenue and created a huge amount of EBITDA (over $800,000). Although the buyer paid over 170% of collections, from his perspective, he actually paid over 5x EBITDA, which was within the market range. According to Aegis, the buyer is likely to go to market in the coming 24 months and sell for 10x to 12x its collective EBITDA.
In a seller's market, where interest from investors and DSOs continues to drive up practice valuations, every penny you save counts. The faster and smarter you can buy the supplies you need to run your practice, the healthier your EBITDA, and the more attractive your practice will look to investors. And automation is simply the best way to get there.
But just as critically, Method’s digital spend management delivers essential frameworks designed for easy implementation of best practices that optimize operations and maximize efficiencies. It’s the scalable infrastructure investors look for in a “box.”
Although many dentists are opting to sell to or align with DSOs, those who don’t now find themselves having to compete against capital-heavy DSOs who enjoy economies of scale.
Whether you’re considering buying, selling, relocating, or leasing a dental practice, it’s a massive financial, emotional, and professional decision that’s not to be taken lightly. Luckily, there are organizations that can help. Our partner, Professional Transition Strategies, can provide you with the expertise needed to make an informed decision by providing the breadth and depth of information necessary to find the best transition strategy for you.
But DSOs still have work to do as well. In order to streamline processes and leverage their buying power to improve their EBITDA, DSOs need to implement standard processes and gain control of spending habits across their organization.
Luckily, no matter the size, maturity, or complexity of your business, a digital dental-specific source-to-pay procurement process offers hidden profits and opportunities for quick improvements.
In order to streamline processes and leverage their buying power to improve their EBITDA, DSOs need to implement standard processes and gain control of spending habits across their organization.
Luckily, no matter the size, maturity, or complexity of your business, a digital dental-specific source-to-pay procurement process offers hidden profits and opportunities for quick improvements.
Method’s e-procurement tool can provide visibility and control to your purchasing chaos so you can increase formulary acceptance and reduce maverick spend.
Our all-in-one dental procurement platform enables best practices and optimizes the entirety of the source-to-pay process, from identification of requirements to payment of invoice, so you can cut costs and optimize cash flow by ensuring you buy the right item, from the right supplier, at the right time and at the best possible price.
Method’s Amazon-like shopping experience offers an efficient way to buy, making it easy for you to quickly compare prices from multiple vendors, including any contract or specially negotiated pricing, so you can make sure to take full advantage of cost savings opportunities. Our procurement data analytics help you identify areas for improvement and gather your buy data across locations.
With access to 2000+ suppliers and over 800,000 dental-specific products, Method gives you ultimate flexibility to buy what you wish, from whom you wish. With our automated RFQ process, you can easily request and analyze quotes from multiple vendors and quickly award business.
When it comes to staying within budget, Method’s order approval process and custom buying rules allow you to control spend, so you can govern according to company policies, improve formulary acceptance, and stop overbuying before you overspend.
Ready to start your journey to a healthy, well-run practice with a healthy EBITDA? Contact us now for a personalized demo.
March 28, 2023
Yes, every dollar saved in supplies directly impacts your bottom line. In fact, we’ve estimated that for every dollar you save, you would have to increase revenue by $2.94 to have the same impact on your bottom line. But that’s far from the only reason to concern yourself with supply chain management and understanding how the dental supply chain works.
Dental supplies are vital to your business. A stockout on any critical item impedes your offices’ ability to service their patients. And just as the price you pay for supplies plays a significant role in your profitability, how you manage your supply purchases impacts your cash flow and budget. Selecting the right vendors who offer quality products and services at a competitive price empowers you to offer the highest quality patient experience while improving profits.
Today’s dental supply chains are complex and fraught with risk. Understanding how they work gives you the knowledge base you need to make the best decisions for your organization, allowing you to mitigate risk and level up your procurement strategy.To get you there, we’ll run through why and how the dental supply chain is so complicated, the problems that lay within it, and the issues it can cause for your DSO. We’ll also highlight some critical mistakes you’ll want to avoid.
Read on to garner the supply chain wisdom that makes for better business and fatter profits.
To ensure your making the right decisions for optimal growth and profits through smarter, more strategic procurement, it’s helpful to understand the vendor landscape. These are the suppliers you will buy from, also known in the procurement world as your tier-1 supplier base.
Although most tend to think of full-service dealers or maybe even mail-order distributors as the main sources of supply, the market is, in fact, wider, and each carries varying risks, service levels, and costs. A more holistic view of the industry will help you safeguard the long-term financial health of your organization and take control of your procurement.
Measured by revenue, the Dental Equipment Dealers industry is a $13.5bn market (2021.)
Although a significant portion of the industry is controlled by two of the largest players, Henry Schein Dental and Patterson Dental, competition is heating up. And digital procurement platforms like Method continue to shake up the industry.
The procurement channels for dental supply can be broken down into the following types:
The most established and well-known of the bunch, your traditional full-service “brick-and-mortar” companies distribute products made by a range of manufacturers and are likely to stock over 40,000 SKUs. Sales are promoted through a traditional sales model where field service representatives are responsible for a list of dental office clients they call on. Dental equipment sales and service is provided through regional branches.
You guessed it, direct sales companies sell directly to practitioners. However, as they only carry specific lines of products, distributors like Komet USA, Kettenbach USA, and Garrison Dental are not able to provide a dental office with the full range of products required to run and operate a dental practice.
Fulfillment houses are named thusly as they fulfill orders upon receiving them from practitioners, sourcing items from varying channels. However, a warning, as these groups are known for carrying “gray market” items and should be considered high risk.
Although they are similar to traditional full-service supply companies, their offerings of equipment lines are typically more limited, nor do they normally provide equipment services. Mail-order distributors reside as call centers dispersed throughout the U.S. and have sales reps responsible for specific accounts that they call on by phone or email but do not physically visit.
One of the biggest changes to the industry, GPOs exist to help practitioners leverage buying power as a group. Bringing practitioners, and their volumes, together, GPOs then negotiate savings on dental supplies and products.
Alright, so that was the simple stuff. Now, let’s dig down a little further into the complexity of your supply chain.
When you purchase from any of the five different types of dental suppliers (this would be your tier-1 supplier base), each company will have its own supply chain. This would be known as your tier-2 supplier base and could consist of thousands of suppliers. Although you would not be likely to have any contact with them directly, they do impact your supplier’s ability to serve customers like you. And it doesn’t end there. Your tier-2 suppliers will also have their own set of suppliers (tier-3), and they will have yet another list of suppliers they must rely on (tier-4), and so on. This supplier base can be comprised of anything from raw material suppliers to logistics providers or machine maintenance services.
The list of materials and services required to make, warehouse, and ship your products is long and global. Your tier-1 supplier base may purchase from offshore vendors. PPE is likely sourced from Asia, for instance. However, even U.S. manufacturers are likely to source raw materials from other countries today. Pulp for masks may come from Canada, for example.
To further complicate matters, not only must a manufacturer rely on their raw material providers and their logistical partners, but they may also contract out part of the manufacturing or assembly process. But, again, that comes with all the partners that the process would entail. In the end, if you were to map out the entirety of your supply chain (something many in supply chain management are now doing), it would look much like a spiderweb that covers a few contents.
The complexity of your supply chain and its dependence on offshore sources should hint at the problems that lay within the dental supply chain. However, the problem begins one step closer to home for the dental industry. Although companies the world over have long since realized the power of procurement and supply chain management to improve profitability, increase efficiencies and safeguard their continuity of business, the dental industry has only just started to understand its criticalness.
As you likely well know, the global pandemic hit the U.S., and as the repercussions rippled through supply chains, dental offices began running into shortage of supply issues. As manufacturers and their partners were often forced to shut down or faced decreased production rates, demand for PPE skyrocketed. Those caught single-sourcing supply without visibility to the market found themselves unable to react, and production rates suffered.
However, pandemic aside, the principle remains the same. Supply chains are intricate, highly interconnected, and vulnerable to a long list of disruptions.
Let’s review some areas of risk that may lie within your “value chain” (another term often used for supply chain that refers to each partner along the chain that adds “value” to the process, whether it be further processing, repackaging, or logistics):
Given recent headlines splashed all over the news, this may seem like an obvious one. However, labor shortages and turnover rates affect more than just a company's ability to produce what they need on time. With every new hire comes the need to retrain, an increased risk of quality issues, and decreased efficiencies (which can lead to escalating costs, service, and capacity issues).
Supply chains have always been riddled with logistical challenges, such as extreme weather and human-made accidents. However, the global pandemic escalated these challenges to a near-grinding halt. Even now, supply chain disruptions of all kinds continue to contribute to shortages of product and raw materials across the country, both in and outside the dental industry.
For the most part, for planning purposes, supply chains work off of historical data, especially in industries where usage remains fairly consistent. For instance, raw materials, labor, and machine time are all planned according to what historically has been required. A mismatch of supply (all resources required to make, sell, or ship a product) and demand (sales) causes a shortage.
Hence, why toilet paper was suddenly scarce during the beginning of the pandemic— systems and processes were unable to handle the sudden massive spike in requirements. In short, nobody saw it coming, and responding takes time due to the complexity of the supply chain. And the shift in supply and demand doesn’t need to be under your own roof or even in the same industry to disrupt your ability to take care of your patients and decrease your patient satisfaction.
Many raw materials are used by a myriad of industries, meaning a raw material shortage in a completely different industry could very well still affect your supply chain. And, of course, a disruption in any node of the chain has repercussions upstream. Although suppliers may have some extra inventory on hand “just in case,” they have long since stopped carrying high stock levels, as holding unmoving inventory is a very costly habit that quickly erodes margins and damages cash flow. This explains why most now prefer the leaner “Just-in-Time” model.
In short, the problem with dental supply chains is they’re complex, riddled with risk, and have little ability to adapt quickly in times of peril.
Here are some ways you can mitigate your risks by looking out for mistakes you may be making in managing (or not managing) your supply chain.
Concentration risk. It’s the fancy term for having too many eggs in one basket. To avoid this, you’ll want to ensure you have vetted multiple suppliers, as well as products for as many critical items as possible, starting with those that are at the highest risk of coming up against availability of supply issues.
Before onboarding a new vendor or even going as far as requesting quotes, make sure you vet them first. See if you can find out what kind of reputation they hold in the industry, ask for customer references, or better yet, ask people you know. You may also want to check their financial status and ask them if they are able to provide you with any clear delivery processes and quality performance metrics. To monitor service levels and ensure expectations are being met, you’ll want to develop Key Performance Indicators (KPIs) to track performance and ensure quality, delivery, and service for each supplier in your supply chain.
When selecting vendors and products, ensure you avoid items from the “gray market”— these are items sold by unauthorized dealers and may or may not be authentic. You may think you got a great deal, but the quality should be highly questionable, and it may cost you more in the end and put you at risk. Even if the item happens to be authentic, it may not have been stored or shipped correctly and could be past expiry and relabeled. Plus, if you have any issues or need to return the product, you’ll soon find out it’s not covered under warranty and won’t be able to recover any of your costs.
Gray market products put your company and your patients at risk. If you’re unsure if a distributor is authorized by the manufacturer, you may be able to find the information online. If not, contact them directly to ask. Do not trust any documentation offered as “proof” by the distributor.
Before you purchase a new product, you should run a trial to test its quality and fit for your Doctors and employees. To do so, set up a trial evaluation committee to review, test, and rate products.Find out more about how to conduct trials here
Shop around and know your market prices. You’ll be surprised to see how much discrepancy there is between suppliers. Make sure you aren’t being gouged. Unfortunately, it’s common practice in the industry for suppliers to increase prices randomly, as contracts are not often utilized to secure pricing without notice. Therefore, always compare pricing to what you paid last time and ask your supplier to notify you (and defend the reasons for) any increases. You’ll also want to ensure the supplier invoices you correctly at the right price and quantities. (Hint: Method’s dental procurement platform can help with this.)
“Over-specing” is establishing specifications that are higher than what is required for the job, and it’s something you’ll want to avoid. Instead, know what is required and buy accordingly. Underestimating your requirements will put your production and your patients at risk, but you also want to make sure you don’t overdo it and purchase something far more expensive than what you really need. For example, you may not require an item to be sterile, so purchasing a sterile item is only going to add unnecessary costs.
The more you get to know your supply chain and understand the market, the more you can protect your business, profits, and growth plan. We suggest you research the companies you partner with. You’ll want to understand their size and where they stand in the market, and, importantly, who their partners are and what their quality control and risk management procedures are like.
Talk to employees, strategize, and look for products that may allow you to better serve your customers or make life easier for your employees. Supply chain management isn’t just about cutting costs. It’s about making smart business decisions on the items that impact your business and its employees, as well as finding better ways of doing things that may help you stay ahead of your competition and reduce human error.
If you don’t know it already, we may want to protect your organization by familiarizing yourself with the Sunshine Act. According to Health Affairs, part of the Affordable Care Act, the Sunshine Act, was designed to increase the transparency of the financial relationship between dentists and manufacturers and “requires certain manufacturers and group purchasing organizations (GPOs) to disclose any physician ownership or investment interests held in those companies.
Supply chain management can be overwhelming— unless you’re leveraging the right partnerships and the right tools. When things go wrong, it’s important to be able to react quickly and secure supply before it impacts your business. Method’s procurement platform allows you to quickly and easily see availability and current pricing from 2000+ suppliers and a product catalog of 350,000+ dental supplies.
Critically, Method Procurement Technologies can help you gain visibility into the market and help you gain a better understanding of your supply chain, while streamlined workflows make life easier for your employees.
Contact us to arrange a personalized demo that suits your needs.
March 21, 2023
Running a dental organization can sometimes feel like climbing uphill. Your practices might be struggling to book appointments, or it may even seem like you're throwing your earnings into the void to pay for dental supplies. When offices are struggling with the day-to-day of taking care of patients and perhaps only breaking even on profits, scaling your business can be challenging.
Thankfully, we've collected some strategies for how to improve. Below, you’ll learn tactics for practicing efficient and profitable dentistry.
With so many day-to-day responsibilities, it can be hard for those at ground level to see the larger financial picture. By taking time to reflect on and communicate your practice's financial health, you can find growth opportunities as a team.
What can you do to help improve efficiencies across the board? How can you leverage your collective power, help to standardize processes, and empower your offices to run more effectively? Your employees will thank you for your efforts, and so will your profit sheet.
Answer these questions to help identify areas for improvement.
Errors and interruptions can directly impact your practice's flow, resulting in wasted time and ultimately decreased overall revenue. Consider helping your dental offices to run smoother by implementing these steps.
Depending on the timing, running out of stock can be a minor interruption or an impassible obstacle, hindering the servicing of clients and damaging both your profits and your reputation. To prevent stock issues at critical moments, you must effectively manage your practice's inventory. Your management strategy should include systems for surveying stock levels and ordering supplies.
If your practices are having frequent supply issues, inventory management software can help. Even if they aren't, it can help improve your company's cash flow and guard your organization against the likelihood of having to write off damaged or expired stock.
You can use software like Method to track your stock levels and know how much inventory you have and how much you need. You can also order from suppliers and track order statuses directly within the software, saving you time and organizing order information. Some systems, like Method, can even track stock levels at various suppliers and provide approximate lead times (the time between placing an order and shipping), reducing the risk of late shipments.
In a dental practice, every second matters. Any time your staff spends scheduling tasks or processing billing information is time they could use to assist patients. By automating repetitive tasks, you can maximize your staff's time while also reducing costly human error.
Here are some areas where you could save time with automatic processes:
Evaluating the flow of traffic in your practice can help save time and even prevent accidental collisions. All necessary equipment and supplies should be easy to access while performing a procedure, so you minimize time away from the chair. Work areas should also be far enough away from each other that your staff can move freely without the risk of interrupting another procedure.
Also, consider removing cabinets entirely from your workspace. The act of opening a cabinet adds an extra step to the process. It can even cause accidents if you hurry to grab supplies, as shaking the cabinet might upset stored items and cause them to fall. Instead of cupboards, consider a system of open shelves and storage tubs. You can keep all necessary materials for specific procedures in designated bins, so you can quickly grab everything you need before performing a procedure.
By relieving your organization’s financial stress, you can alleviate pressure and help your employees focus on serving their community with the best possible care. To create a strategy for success, follow these steps.
As much as 64.5% of the money earned through the procedures you perform goes directly to overhead, and almost 10% of the overhead is dental supplies. Any money saved on inventory improvements is an increase in overall profit.
Unlike revenue, savings through improved purchasing and inventory management hit your bottom line dollar for dollar. However, comparing prices between suppliers can be challenging and time-consuming, and ideally, you should spend most of your time on procedures. Consider using purchasing software to aid in the ordering process.
Method’s Spend Management Platform provides you immediate access to a streamlined P2P System, including a product catalog of 750,000+ products, real-time pricing, and availability on your preferred items and approved alternatives, and over 2,000 dental-specific suppliers so you can shop fast and smart.
In addition to setting minimum and maximum stock levels, smart inventory management software can help you find the best price for your dental supplies. Leverage your collective volumes with procurement analytics and a digital, easy-to-use RFQ process that allows you to easily request and receive quotes from multiple suppliers within the platform, then automatically turn quotes into orders.
Purchasing software can also assist you in checking for discrepancies between quotes, purchase orders, and supplier invoices, ensuring you pay no more than you should. You can even check for duplicate payments and other billing errors. Whether discrepancies are an accident on the supplier's end or an intentional effort to make you pay more for a service, cross-checking all aspects can help keep you from paying more than you should for your supplies.
Last but not least, a robust digital P2P process should provide you with the controls you need to enforce and govern buying policies and improve formulary compliance.
Hiring more staff may seem counterintuitive at first, especially if your practice is already struggling with finances. In reality, additional employees can help bridge the profit gap. Suppose your practice only employs a single front office worker. In that case, they are likely already working at total capacity by answering phones, greeting patients, checking patients in and out, and even filing insurance claims. These tasks are necessary for keeping the office afloat day-to-day.
To maximize profits, you must fill up your schedule with appointments. A single office worker may suffer from burnout if they try to find ways to fill the schedule independently, which can lower their overall work performance and even cause long-term health complications. By hiring one or two extra staff for the front office, you will free up a significant amount of time they can use for contacting customers directly and providing top-tier customer service.
When a new patient makes an initial call, your staff will have opportunities to nurture them and schedule an appointment. They can reach out to existing patients to remind them about upcoming visits or even reschedule appointments they might have forgotten. Perhaps most importantly, reducing your staff's burden will help create a more positive and less stressful office environment. Hiring additional staff will improve the moods of the rest of your team, boosting morale and productivity. Your patients will notice the positivity, and positive interactions with staff can help improve your practice's reputation.
When appropriately used, membership programs are excellent tools for patient acquisition and retention, especially for those who cannot afford dental insurance. Rather than directly offering your services at a steep discount, you can use a membership plan charged as a monthly fee to provide preferred pricing to your members.
Membership programs help promote patient loyalty because the patients feel more "attached" to your practice. Membership fees can also act as a stable source of revenue for your practice. By setting a monthly fee for your members, you guarantee that you receive a dependable amount of money each month. For example, 50 members with a membership fee of $30 per month will give you an extra $1,500 per month, even if your patients only come into the practice for a cleaning once or twice a year.
Another advantage of membership programs is that they are entirely separate from insurance companies. They allow you to communicate rates with your patients with complete transparency, so your patients only pay for the treatments they need, and you can avoid juggling insurance issues.
Standing out among dental practices in your area can be challenging. To ensure your offering catches attention, try finding new and exciting ways to serve your patients. Look through your competitors' services and identify holes in their offerings. For example, there may be a surprising lack of practices that offer dentures and veneers. When you find a service that fills a community's need, seize the opportunity and try implementing the service in your practice.
The first step to bringing in patients is to let them know you exist and that you're eager to serve them. There are many ways to spread your practice's message, including internet marketing campaigns and customer referrals. Whether you launch a campaign on your own or use an external marketing company to lead the effort, you will gradually reach more potential patients and increase the likelihood of scheduling an appointment.
Here are a few easy ideas for getting started with a marketing strategy:
Make the most of your valuable time and increase productivity withthese steps.
Ordering processes can take a significant amount of time away from your staff's other duties. From comparing prices between suppliers to keeping track of current inventory levels for making purchasing decisions, the process can take hours away from your practice each week.
One way to ease the burden is with intelligent purchasing software. You can use the software to quickly request quotes from multiple vendors at once and compare them side by side when purchasing. The cost analysis helps you select the best price for your supplies, including shipping and handling fees, helping you save time and money.
Other productivity-boosting features include the ability to view all orders, invoices, and payments regarding an order in a single place, so you can quickly find any documents you need. You can also use rapid auto-order tools to quickly generate and send purchase requests for products you need to order frequently.
With improved inventory management and streamlined ordering, you can begin to bucket orders, reducing the overall number of orders being placed, deliveries you need to receive and put away, and invoices you need to pay, improving efficiencies throughout the purchase-to-payment cycle. Ordering less often also means you can take advantage of larger price breaks and save even more.
While some tasks are necessary for you to take on yourself, you may be able to save on employment costs by outsourcing them. For example, it's essential to keep the building clean to ensure patient satisfaction and health. Rather than asking your staff to clean, you can hire a cleaning service instead. Outsourcing everyday tasks allows your team to focus on more critical functions like maintaining healthy patient relationships.
Other tasks you may consider outsourcing include:
One of the quickest ways to fill up your appointment schedule is to implement an online scheduling system. The ease of access makes a world of difference for patients and your staff alike. For patients, the convenience of an online scheduling system allows them to review all available time slots at their preferred pace, which lets them cross-reference their schedules.
Online scheduling systems increase customer satisfaction, increase bookings and even reduce cancellation rates. For your staff, introducing an online scheduling system will help them reclaim part of their day. That way, they can spend less time looking at a calendar and more time helping your patients.
Providing easy and convenient ways for patients and staff to communicate can help boost productivity. Consider implementing a system for text alerts, live chats on your website, or even a mobile app for your practice. With a text alert system, you can easily send appointment reminders to patients without the need for a call. And if you have a method for text communication, you can provide patients with even more ways to engage with your staff. Patients who prefer texting over phone calls will be more likely to respond to your communications if you reach them in the way that works best for them.
Recent hires and long-term staff can benefit equally from professional development opportunities. By investing in employee growth, you can teach your team more efficient processes for their daily tasks, which boosts productivity in the long run. Your staff might even be willing to learn and accept new duties, allowing your practice to grow in exciting ways.
One of the most significant barriers to a dental practice's efficiency is inventory costs, making purchasing and inventory management software an outstanding ally. Method purchasing software streamlines the procurement cycle so you can focus on building your practice while saving money. From keeping track of current inventory to automatically sending quote requests and orders to suppliers, we can help you reclaim your schedule and better control your spending.
Our modern interface is easy to use, allowing for increased productivity with little to no training required. We also believe increased efficiency and improved financial results should be accessible to everyone, which is why we offer pay-as-you-go subscriptions with transparent pricing.
If you're ready to increase productivity and reduce cash lost on inventory, request a personalized demo or contact us today. If you have any questions, feel free to call us at 800-742-2100. Our client success team is ready to support you every step of the way.
March 20, 2023
When you are fighting to achieve maximum cost savings, it can be easy to get carried away and make rash decisions based on a number on a screen. Although, given today's financial and competitive climate, it may seem penny-pinching is necessary, aiming to purchase every item at the lowest possible price or waiting until the last possible moment can, in the end, cost you more.
Good procurement is about setting the right strategies to meet your overall objectives, aligning your procurement actions with your company values, and avoiding the many pitfalls that hurt your bottom line.
For cost savings initiatives to actually impact profits and improve your organization's EBITDA, all cost drivers must be taken into account. And for negotiations to be successful, price comparisons must be fair and accurate.
Let’s review some procurement basics your employees may be missing that could be taking a bite out of your margins and reducing the efficacy of your efforts.
When comparison shopping, it’s essential to perform a full net cost comparison by ensuring you include shipping costs or any other fees or additional charges. You want to avoid cutting a separate purchase order unless you net out actual savings. If you have preferred or strategic vendors, find out how you can reduce or eliminate shipping costs. There may be better ways of bundling your orders, or it may be as simple as making the ask for a reduced rate.
When it comes to negotiating, it’s crucial to ensure you’re comparing apples to apples when doing your price analysis. Suppliers aren’t likely to meet or beat a price for an item they don’t consider equivalent to what they’re offering. For example, you may want to compare a private-label product price to a brand-name price to see if it’s worth making the switch.
When it comes to negotiating and rating your suppliers on price competitiveness, the comparisons should be fair and equal, i.e., private labels to private labels. For brand name products, reference product identification numbers for accuracy.
Also, don’t let packaging or units of measure trip you up. If pricing is per box rather than per unit, so make sure you do the math and break out pricing for accurate and fair cost comparisons.
It’s important to remember that hard cost savings aren’t everything. Although the actual costs aren’t easy to quantify, labor costs are an essential consideration, especially in a busy office environment where staff often have conflicting duties.Overdoing it by splitting every purchase into separate purchase orders may only serve to overburden your employees while increasing your labor costs
Every PO you issue requires the following:
Remember, “soft” savings count too, and in the end, your goal is ultimately to do more with less and ease your employees' workload when it comes to procurement, so they can remain focused on the tasks they were hired for.
Every purchase is an opportunity to leverage your volume and create a strategic competitive environment. This makes every transactional purchase with an unproven vendor and without a specific intent or strategy a lost opportunity. Unless it’s part of your procurement strategy, the more you mature in your dental procurement practices and supplier management, the fewer transactional purchases you should be making.
Part of supplier management is helping your suppliers grow their volume, and of course, the same in the inverse- your suppliers should be supporting your growth. If you find better pricing online, allow them to match, or better yet, do better. The extra volume will motivate them to keep providing you with their best pricing and top service while allowing you to conglomerate your orders, creating less work for all.
Recognizing cost savings often comes down to increasing order sizes. However, for most organizations, cash is king, and achieving the right balance between maximizing your savings and maintaining healthy cash flow is imperative to your organization’s financial health.
Weighing the status of your cash flow against your need for cost savings and service should be part of setting your values and objectives. However, it never hurts to at least try and negotiate longer payment terms with preferred and strategic vendors.
Also, when selecting preferred vendors, make sure to factor in lead time to your decision-making. The longer it takes for dental supplies to deliver, the more you need to keep on hand.
Yes, there are potentially decent cost savings for moving to a private label or another lower-cost brand you haven’t tried before, but lower-quality products can come with risks, so make sure you run any trials, review any necessary regulatory documents, and garner feedback from end-users.
Procurement often comes down to managing trade-offs. Meaning, perhaps you can get a product at a lower price from a new supplier but need to wait longer for delivery. Or, you have the opportunity to save by moving to a private label, but although the quality is close, it’s not all the way there.
Help guide your employees’ decision-making and ensure your cost savings initiatives align with your corporate objectives and values so they know when to save and when to prioritize other areas such as service and quality.
Yes, every penny does count, but it’s how you count your pennies that really matters. Cost savings initiatives on dental supplies often involve changing to a slightly different product or introducing a new supplier. As crucial as those savings may be, recognize that these changes come with their own set of risks to be mitigated. A robust vendor approval process and new product testing procedures are vital to safeguarding your business. So remember, slow and steady wins the race.
With Method, you can easily put in the safeguards you need and keep track of your inventory management process. To learn more, contact our dental procurement experts to see a demo today!
March 13, 2023
In a previously published article, How Effective Procurement Can Help DSOs Drive Profits, we discussed the relationship between cost savings and profitability vs increased production and profitability. As a reminder, hard cost savings go straight to your bottom line while any production revenue has a cost associated with it. This means that saving $1,000 is equivalent to a production gain of $2,940. Of course, increasing production is key to growing your business, but a commitment to lowering your costs will also have a significant impact on profitability, improving your EBITDA and increasing the value of your practice.
With this in mind, it becomes important to understand exactly what constitutes “cost savings?” There are two types of savings to consider, hard costs and soft costs. Hard costs are straightforward. If you purchase a product from Supplier#1 for $2 and Supplier #2 only charges you $1, then you can realize one dollar in hard cost savings by purchasing from Supplier #2. Soft costs are a little more difficult to quantify but can have an equally significant impact on your bottom line. Consider the following scenario. Janet is an employee in one of your practices. She has a variety of responsibilities, including servicing patients and managing the inventory of your office supplies. Janet spends 15 hours a week checking the level of supplies, placing orders (including looking for the best prices, deals and promotions), issuing POs and checking and recording received orders. Now, let's imagine that you start to use an inventory management solution, like e-procurement software, that allows Janet to complete her inventory management tasks in just five hours a week. How would you classify the savings and calculate the financial impact? Well, it depends. If Janet gets paid by the hour and winds up working ten hours less each week, that's considered hard cost savings, equivalent to ten hours multiplied by Janet's hourly wage. However, if Janet uses those ten hours to complete other tasks, including ones that allow you to see more patients, then it becomes trickier to quantify the savings. What if Janet works five hours a week less, giving her more family time which improves her job satisfaction and decreases the likelihood of her quitting? What is this worth?
Clearly, there are significant benefits to increasing efficiencies and freeing up your employees to focus on what they do best, taking care of your patients and during a labor shortage, learning to do more with less should be a key initiative for DSOs. However, although these improvements should help maintain (or even increase) production levels and better your bottom line, the savings are indirect and often difficult to quantify. Hence, they are considered to be what is known as “soft” cost savings. To clarify things further, here are just a few examples of both hard and soft cost savings.
We’ve already established that actual hard cost savings are tangible and immediately impact your financial results. Cost avoidance is, as the name hints at, a cost you circumvent through preemptive actions. Cost avoidance measures include negotiating a reduction in or eliminating price increases or eliminating the need for increased labor through streamlined processes.
It’s important to remember that although soft cost savings and cost avoidance may seem or feel less important than hard savings, that is most often far from the case. Their intangibility doesn’t necessarily align with the value they bring to your organization, especially if you are challenged with attracting or retaining staff.
For instance, improved inventory control may ensure you avoid stock-outs on critical dental supplies, safeguarding your service levels, and preventing a revenue loss. These things are vital to your organization’s health and your potential growth, and their importance is no less significant, perhaps even more so, than the purchase price of supplies. It’s essential to understand how the varying types of savings may impact your financial statements, but it’s also equally important to keep the naming conventions in perspective.
Despite the name, hard cost savings are hard worked for and can bring massive benefits to your dental practice. Underestimating their impacts may put you at a competitive disadvantage.
Using a dental inventory management system helps you improve your bottom line, both from a hard and soft cost savings standpoint. To learn more about how Method can help your dental practice, contact us today to get a free demo and talk with our dental procurement experts!
March 7, 2023
When you don’t know what you have, it’s hard to see what you need.
Historically, a lack of access to suitable inventory management tools designed for the industry hampered business improvements. However, as dental organizations struggle to remain profitable, standard inventory management practices can help secure the cost savings you need and make for good first steps in gaining control of your spend.
As we’ve said before, there are big costs to poor procurement, and good procurement starts with solid inventory management. Because when you don’t know what you have, it’s impossible to make smart, informed decisions on what it is you should buy.
Let’s take a look at the basics of inventory management and some of the best practices that will help guard those hard-earned profits.
Inventory management is the tracking of your most critical supplies, including what you have on order and any movement in and out of your stockroom. The goal is to know how much you have on hand, when more will be delivered, and, most importantly, when it’s time to order. But the benefits don’t end there.
Good inventory management means you have control over your inventory and are able to make smart buying decisions based on facts and data, buying what you need, when you need it, in the quantity that makes the most financial sense for your business.
Inventory management enables you to keep enough inventory on hand for production requirements while avoiding the hefty costs and repercussions of carrying too much stock, such as impeded cash flow and assuming financial losses from expired inventory. It is the framework to the procurement processes that stop profit leakage and enable you to leverage your purchasing power and lower your cost of supplies and improve your profits—making it every bit worth doing.
Whether you opt to record your inventory counts and movements with a barcode scanner to increase efficiency and accuracy or start with a manual process such as Kanban, the critical part is that you start. In case you haven’t heard it before, unlike increasing revenue, every dollar of cost reduction makes it straight to your bottom line.
We’ve actually estimated that in a typical dental practice with a 34% profit margin, every $100 saved in overhead yields the same profit to its owner as increasing production by $290.
At Method, we believe in practical, employee-focused real-world solutions. To ensure long-term adoption and successful implementations, it’s imperative you “keep it real” during project selection and execution with careful consideration given to your available human and financial resources. Remember the Kaizen philosophy, small but consistent steps forward will get you further faster, so set realistic goals.
Not finding the supplies you need when you need them can be frustrating (and wastes valuable employee time). And counting inventory when your stock is in chaos is equally so. Establishing a streamlined process for stocktaking (the counting of your inventory) will help limit errors and ensure the reliability of numbers while reducing the time spent and lessening frustrations.
Although our hope is the below will help you streamline the process and thereby make it more manageable, we understand that regularly counting inventory may not be a realistic starting point for some dental practices. If this is the case, we suggest scanning your dental supplies as they are pulled from stock and then performing inventory counts when you are able or when large inventory discrepancies are found.
Before performing your counts, we suggest you clean and organize your stockroom.
Once you’ve designed a process, standardize it by documenting it and training delegated employees. Be detailed enough in your guidance and provide step-by-step information. Now, set a stocktake schedule and adhere to it. Then, make sure all your employees are aligned on the above. They should know by who, when, and how your counts will be performed.
Remember, new processes take some time to take root and may be designed imperfectly. Follow up, and ensure the counts are completed as planned. Retrain or make adjustments to the process if issues are found. Reiterate until success is achieved.
We admit we may be biased, yet, the fact remains— leveraging automation with a cloud-based Procurement Management System (complete with inventory management, barcode scanning capabilities, and client support to help you implement streamlined best practices) is one of the best profit-improving decisions you can make for the health of your dental organization.
Standard, streamlined, scalable processes ensure effective procurement despite any turnover, so you can leverage your volumes, improve your cash flow, drive cost savings and ensure you pay no more than you should.
An electronic Spend Management Platform can Help DSOs:
Ready to bring Method to your madness, so we can help you get where you need to go?
Request a Demo today to see our software in action, or contact us with questions!
February 17, 2023
Throughout the years, giants such as Toyota and Motorola have given birth to methodologies that aim to help guide organizational improvements. Although initially born out of necessity for manufacturing efficiencies, the principles and methods have proven universally effective and have since been adopted to at least some degree for businesses of all sizes and by almost every industry. So why should the dental industry be any different?
How you manage your dental supply purchases and inventory across your organization significantly impacts your bottom line. Building a culture of change acceptance and continuous improvement can be a significant competitive advantage, allowing you to implement core best practices that reduce your overhead costs and minimize your risk exposure, and lays the foundation for a financially healthy, scaleable business model.
Some of the most notable organizations that have successfully implemented these methodologies include Amazon and 3M. Motorola itself claims to have saved $16 billion for its Six Sigma efforts alone. Toyota Production System (TPS), Six Sigma, and the culmination of the two, Lean Six Sigma, are just as much philosophies and mindsets as they are tools and methodologies.
For those who are well-versed, terms such as 5S, Kanban, and Kaizen represent the fundamentals of how they work. These same basic principles are what Method was founded on, a systematic approach to driving out costs through better dental inventory management and dental procurement practices.
There are valuable lessons and tools to be garnered from each, so let’s review.
The father of Lean, TPS, was developed by Taiichi Ohno at Toyota to improve manufacturing and logistics, minimize cost, and reduce waste of all kinds, including removing time from processes and improving flow. Lean became a generic version of TPS, and although often used synonymously, there is a difference to the very discerning eye.
Kaizen (roughly translated to “continuous improvement.”) is a core principle of TPS focused on setting a gradual adoption of small but significant improvements by involving all employees and building a company culture of continuous improvement. Objectives include standardizing work, elimination of waste, and just-in-time (JIT) inventory practices. The core beliefs of kaizen are:
In 1986, Mikel Harry and Bill Smith from Motorola invented Six Sigma and the DMAIC improvement method—Define, Measure, Analyze, Improve and Control—which guides practitioners to systematically define and address the root causes of process problems and then maintain the gains.
As well as a method for process improvements, Six Sigma is a philosophy, a mindset, a goal, and a measurement system. The data-driven approach aims at limiting the number of errors or defects in a process to what is considered to be near perfection, a maximum of 3.4 occurrences per million opportunities (units or events.)
For DSOs, Six Sigma can be used for such things as improving material flow (the movements of your supplies) and gaining better organization, allowing you to quickly and easily find what you need when you need it.
[H2] Lean Six Sigma
As you’ve probably guessed, Lean Six Sigma is the melding of the two continuous improvement methods. It provides a vast tool kit of problem-solving tactics and reaps the benefits of both systems. Lean Six Sigma benefits include:
These philosophies and business methods not only improve profits but engage employees, value their intricate knowledge of business activities and processes, and recognize them as the best resources for analyzing and enhancing procedures. Getting your buy-in and empowering employees to positively affect their work environment makes for happier employees and better margins.
These principles are evidenced throughout Method, which was designed with the goal of streamlining and improving dental purchasing processes, increasing efficiencies, and decreasing the costs of dental procurement. They’re reflected in the dental inventory control methods and procurement analytics that allow you to lean out your inventory and improve your cash flow. For example, the purchase order entry process minimizes time requirements and eases workflow throughout the Procure-to-Pay (P2P) cycle while reducing losses for your dental practice or DSO. And, of course, they are the main driver behind our at-your-fingertips market pricing and request for quote management process.
Regardless of the industry, lean tools can be used to gain quantifiable improvements by minimizing inventory levels, reducing waste, limiting losses, improving workflows, and reducing the likelihood of human error.
Like any other business looking to improve its EBITDA, your DSO needs to drive quantifiable improvements. Enter Lean Six Sigma.
Further powered by the automation Method brings, these methodologies are the backbone of profit-enhancing procurement practices. Taking it one step further by implementing the principles and utilizing the tools you see fit into the fabric of your organization can help you meet the challenges you are facing today while propelling your growth for tomorrow.
Contact Method Procurement Technologies today to get more information on how we can help you streamline your dental practice procurement strategy.
Method Procurement Technologies gives independent dental practices and DSOs the inventory management and procurement capabilities they need to succeed. With our full, end-to-end solution, ordering dental supplies is straightforward and hassle-free.
Learn how Method Procurement's spend management solutions can improve your bottom line. Get in touch with our team today or request a demo to see it for yourself.
February 13, 2023
The goal of procurement is to buy the right products, in the right quantity, at the right time, and at the best possible price. Buy too late or too little, and you risk running out, but buy too soon or too much, and you're tying up valuable cash and racking up carrying costs.
Much like the story of Goldilocks and the Three Bears, getting inventory “just right" takes a little finesse, and if you’re not careful, you may get burned in the process. How you calculate the right inventory levels for your organization or practice is a critical business decision with multiple decision factors and a slew of repercussions.
These formulas and purchasing triggers have a direct impact on your efficiencies and financial health. To target the “right” inventory levels that make the most sense for your dental organization and its values and objectives, you must weigh your decision criteria carefully. This requires knowing your risks (we’ll dig into those later) and understanding your company's tolerance for it, and carefully balancing this with your desire for improved cash flow and cost savings.
Using a value-driven decision method allows you to align your procurement strategy with your overarching business objectives, a vital step in meeting your targets.
Here’s the information you need on some inventory management basics and the various purchasing models that, when chosen correctly, enable you to get there.
To provide you with some foundational knowledge, below we have listed some quick explanations of the terminology behind the various inventory management techniques and methods that you should get to know (i you haven’t already).
JIT is the Lean's world "just right," aiming to get deliveries at the last possible moment without risking an outage. You would achieve JIT by using tools such as reorder point/ reorder quantity or Kanban.
The length of time, typically in days, between the placement of an order and delivery. Note that suppliers should be quoting their lead times on Request For Quotes (RFQs), but if you don't have them, just ask.
Just as it sounds, safety stock is an additional quantity of an item you keep "just in case." It's your buffer, safeguarding you from running out due to the unforeseen, such as late delivery, inaccurate inventory levels, or increased usage. It should be calculated separately for every item, as each product may have varying usage volumes and supplier lead times.
ROP is a pre-determined inventory level where once the total on hand plus on order falls under the set point, it triggers a replenishment order.
ROQ is the set order quantity for placing replenishment orders.
Safety stock is your safety net, and only you can figure out just how big you can afford or want it to be. Use a common-sense approach. Know your sales rep is in town and will bring you some in his car if need be? Carry less. If the item is a low-value item but imperative to operations and has a long lead time, go heavy.
Here are some things you should consider when setting the safety stock level for dental supplies:
It’s important to note that the above two options are given mainly for items with large swings in daily consumption rates. For items where your usage is fairly stable, it will make little difference which you choose.
To calculate your reorder point, you want to figure out how much you are going to use before the order delivers (average daily usage x lead time in days) and then add your safety stock.
Again, this formula is not a hard and fast rule here. What you decide to set your ROQ at can vary depending on a couple of determining factors. The primary considerations should be the consistency of your usage (the more stable, the less risk), lead times, and any price advantages of purchasing specific quantities.
Also, keep in mind that any potential cost savings should be weighed with the cost of carrying inventory. For example, if you could save 25% by buying an extra 3-5 days' worth of inventory, this is likely very worth doing. However, if you’ll be saving 5% and the quantity will last you a year, your risks and additional carrying costs likely outweigh the small savings.
In dental procurement, demand signals tell a buyer when to buy. They can be either physically visual or electronic, available on a report. Based on your current inventory levels, open purchase orders, and preset ROP and ROQ, Method's order report will provide a list of items and quantities needing to be purchased.
If you're doing your due diligence and maintaining the necessary processes, knowing what to order is as easy as that. However, at Method, we understand adopting new practices and making improvements doesn't happen overnight. Depending on resources and organizational maturity, a physical demand signal that requires less system maintenance may be better suited to some dental practices. In this case, Kanban may be the "just right" solution for you.
Knowing where you are as an organization and setting realistic goals is imperative to gaining adoption and seeing gains. Remember the Kaizen philosophy, and focus on establishing a gradual adoption of small but impactful improvements.
Keep in mind that as your organization grows and changes, what is "just right" will as well. Dental procurement and inventory policies and procedures should be reviewed periodically or along with any significant business changes. And your spend management software should be simple and flexible enough to implement quickly while being robust enough to grow with you as you scale and mature your business practices.
Once you’ve gone to the trouble of deciding how its best to manage your inventory and just how lean or stock-heavy you want to run, you may want to consider implementing a spend management platform that provides you the control you need to set and govern corporate policies and manage your inventory efficiently and effectively across locations.
Streamlined digital procurement brings many benefits for all parties, making life easier for employees so they can spend their time focused on their patients and empowering business leaders to leverage buying power, lower costs and improve profits.
Whether you’re a dentist or a dental assistant who manages the inventory on top of everything else you need to do, sometimes wearing so many hats can get exhausting. That’s why we created a cloud-based software to help you manage your inventory, receive your dental supplies, and pay your vendors all in one place!
Contact us today to set up a demo to see how it can revolutionize the way your purchase your dental supplies.
February 2, 2023
Challenged with increased costs and a labor shortage, DSOs are leveraging the power of procurement to drive bottom-line growth. We take a look at the business case for Digital Spend Management.
Digital procurement has a unique ability to help drive bottom-line growth that has shown to be far more effective than other growth strategies, such as increasing revenue.
At the core of every dental practice is a long list of critical supplies that are required to perform the many services you offer your patients. Whether or not you purchase these supplies is not an option. But how you choose to do so has a very real and direct impact on the daily lives of your employees, their ability to provide optimal care, your production rates, efficiencies, and overall profitability.
For DSOs that are looking to drive growth and increase net profits, incorporating a digital spend management platform enables you to further exploit the inherent opportunities afforded to a DSO— economies of scale while delivering the foundational tools you need to build effective, scalable operations. However, communicating the benefits of an e-procurement platform and making the business case for it isn’t always easy.
Let’s be honest; procurement hasn’t always been top of mind for the dental industry. However, with the combination of purpose-driven innovation and digital transformation sweeping the industry, that’s quickly changing. Challenged with a labor shortage, an increasingly competitive landscape, and a sometimes volatile supply market, following suit with just about every other industry, those in dentistry are now turning to procurement to mitigate risks, deliver scalability and drive bottom-line growth.
A well-thought-out business case should provide stakeholders and decision-makers with your decision criteria and full transparency on the rationale behind your final request to invest in your chosen business solution.
It should include an evaluation of the benefits, costs, and risks of alternative options and provide the advantages of your preferred solution. If framed correctly, your business case should act not only as a tool to get your buy-in but as a management tool for monitoring and measuring project delivery and performance.
To ensure a thorough business case for digital spend management, it may be helpful to structure your argument in the following way:
Why it’s time to look beyond increasing practice production
Historically, the dental industry has focused on production as the primary driver for improving profitability. The more chair hours a practice books, the more income is generated. Although this does contribute to profits, the percentage of revenue increase that makes it to your bottom line may not be quite what you’d expect. The impact of revenue growth on profitability is far less than any cost savings you can realize.
Based on average industry overheads, $100 in overhead costs savings has the same impact on profits as creating a $280 increase in production. This equates to an estimated annual savings of $233,000 per year for a mid-sized DSO and $1,170,000 for large DSOs.
That's even more impactful when you consider the benefits can be achieved without fitting additional treatments into an already-full schedule, acquiring new capital assets, expanding your offices, or investing in risky marketing initiatives in an effort to gain new patients.
With the massive impacts of procurement on profits in mind, many DSOs are now focused on finding new opportunities for bottom-line growth by leveraging technology to proactively manage the complete Purchase-to-Payment (P2) cycle.
By bringing a modern, digital-first approach to strategic procurement, DSOs are no longer hindered by a lack of visibility on purchasing data, market dynamics and real-time pricing. Digitization has enabled dental organizations to transition from a transactional, arduous and often neglected and inefficient process for purchasing and managing inventory to one that can execute on strategy and deliver true value.
You can see why e-procurement was one of the hottest topics in the industry in 2022.
However, there are important considerations when it comes to selecting the platform that will be right for your business.
When evaluating solutions, it is critical to balance the desire for short-term gains with your long-term objectives. The “right” solution should be easy to implement, so you quickly begin to realize benefits, but should also be robust enough to grow with you over time, empowering you to leverage your collective volume with a supplier-friendly digital RFQ process, identify synergies across locations and improve formulary compliance.
Method offers just that, providing everything you need to optimize your procurement, including both deep and snapshot analytics, a digital Request for Quote (RFQ) process, and an Amazon-like marketplace with a detailed product catalog of 700,000+ dental supplies and access to 2,000+ dental-specific supplier database.
Strong inventory and spend management are essential to an efficient and productive dental practice, allowing you to improve cash flow, mitigate the risks of financial write-offs and decrease your carrying costs (the costs of holding inventory).
It is the backbone of a well-run operation that empowers you to maximize the very opportunities that come with being a DSO.
DSOs are in the business of providing non-clinical business support and can take advantage of economies of scale and leverage more buying power to lower overhead costs and negotiate better deals for supplies and services. At least, in principle.
Your ability to execute this by providing the right tools and guidance on procurement and inventory practices that ensure smooth operations and the reduction of overhead costs should be considered essential to the DSO business model and a significant competitive advantage.
The average dental practice spends nearly $225,000 annually on products and services that could be influenced by direct supplier competition. Multiply this by the number of offices under your directive, and that represents significant buying power and leverage.
So, how do you take full advantage? By garnering perspective on market pricing and acquiring the right tools, more control, and stronger foundational processes to effectively utilize your buying power. This will facilitate the transition from transactional to strategic procurement, designed to meet organizational objectives and optimize outcomes.
Healthy competition makes for a healthy supplier ecosystem.
With a quote process based on your projected annual spend and real-time visibility into market pricing, you can seek the overall best value for your full buying power. As a result, you can form strong supplier partnerships and create a vibrant, motivated supplier eco-system that ensures the security of supply, delivers optimal service, and lowers costs significantly over time.
Often called the five “rights” of procurement, the goal of procurement is to enable you to buy:
Stockouts- for any reason- can lead to costly disruption, putting patient care, your reputation, and your practice at risk. However, holding too much inventory hinders your cash flow and puts you at risk of incurring financial penalties if items become lost, damaged, obsolete, or expired.
Proper inventory management is an effective mitigation tactic, and every practice should be working toward implementing a standard, digitized process for tracking and managing supplies.
Reducing the direct costs associated with inventory begins with the accurate tracking of inbound shipments through the usage of Purchase Orders(POs) and order-tracking tools. A single misrouted or delayed order can have a ripple effect across the practice and put you at risk of not being able to service your patients in case of a critical stockout. Therefore, it’s imperative that all team members have access to information about orders placed and details on shipments.
Additionally, POs are legally binding documents that hold suppliers accountable to agreed-upon order requirements, ensuring you deliver on the five rights of procurement. Finally, a three-way match process (that references the PO to verify invoice data) ensures accurate payments are issued and protects against fraud and error.
In a dental setting, all supplies should be inspected, counted, and recorded upon arrival. This doesn’t need to be time-consuming, but it does need to be done consistently. Electronic systems that keep detailed records make this efficient for your entire team, including finance, and provide an audit trail of exactly what happened, when, and the actions taken.
A smart inventory process also includes a disciplined approach to recording the usage or withdrawal of on-hand items, as this is how you’ll know when it’s time to order and also provides you with accurate usage data and critical information when it comes time to negotiate volume breaks.
Method’s inventory management system allows you to easily create a digital product catalog of preferred items or formulary, allowing you to track each item, including its precise location and can provide alerts when items fall below their Reorder Point (ROP)l, and it’s time to replenish.
For ultimate efficiency and accuracy for busy practices, Method offers barcode scanning to reduce the effort needed to identify, count, and order products. With the advent of the FDA’s Unique Device Identification (UDI) regulations, more and more manufacturers are including unique barcodes on supplies. Integrating barcode scanning with a digital inventory management system can rapidly provide the best possible end-to-end process to coordinate your team and reduce costly human errors.
Anyone involved in dental procurement can tell you it’s not as simple as clicking “Buy Now.” Procurement is a complex business process that includes activities such as:
With so many moving parts to the procurement process, and a very long list of technical supplies to manage and discern from, it’s not uncommon to see practices wasting efforts and resources. Add to this a heavy reliance on spreadsheets, faxes, emails, phone calls, and numerous supplier portals to manage the entirety of the process, and the managing of supplies quickly becomes unruly, bringing chaos to your practice, wasting employee time, and leaking profits.
Method finds that for a typical organization, digital transformation can save 30% or more, representing an annual savings of up to $5,000 or higher on the associated labor, over and above the earlier-mentioned savings that can be found through supply cost reductions.
Additionally, practices get the boost that comes from freeing up staff's time to work on other important matters, like scaling initiatives or ensuring quality patient care is provided.
By utilizing technology, you can implement best practices designed to keep your practice safe from fraud and reduce or eliminate costly errors, either on the part of your employees or your suppliers.
By synergizing your operations, you can identify areas of improvement and establish the protocols to implement change, empowered by a singular digital platform that enables collaboration. Task owners can attach documents, leave comments, and quickly find all information and documentation for a transaction available in one place.
ROI = Net income / Cost of investment
Today’s competitive environment makes it challenging for DSOs to grow rapidly while remaining profitabe. At a time when practices are suffering from stagnant reimbursement rates, increased competition for patients, and extremely high overhead, improved spend management offers bigger, faster impacts with very little risk.
Method’s spend management platform delivers a fast ROI, with a low barrier to entry, a user-friendly interface that allows for quick adoption, and an Amazon-like marketplace experience that makes buying smarter and saving money easy.
At Method, our mission is to help you boost productivity across your organization and deliver radically improved financial results fast, through improved spend management. Our customer success team will be with you every step of the procurement journey, dedicated to making your procurement efficient, effective and profitable.
We provide the guidance and education necessary to ensure that your teams can comfortably and confidently maximize our platform's capability, and have designed a 4-step Onboarding Program to guarantee that you will experience immediate and lasting results.
In summary, in return for your investment, Method’s electronic Spend Management Platform can help DSOs:
Getting Started on the Journey to New Profits
The financial pressures on DSOs are here to stay, and those leading the charge are finding they must innovate to drive new areas of opportunity.
Lowering overhead through an improved procurement process is an untapped source of new profits for many dental organizations. Digital tools to support this transformation deliver a surprising return on investment (ROI) and can make the dental office a better, high-functioning workplace for all.
Method’s dental-specific Spend Management Platform helps guide and automate best procurement practices, making it easy for your team to use every day.
If you need further help building your business case or have questions about why Method is the “right” platform for you, contact us at any time.
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January 23, 2023
For Dental Service Organizations (DSOs), Group Purchasing Organizations (GPOs), and multi-location dental practices, Spend Under Management (SUM) is a Key Performance Indicator (KPI) that should be treated with critical importance.
Knowing what SUM is and how it can lead to improved financial performance should be well-understood by all organizations looking to leverage and optimize spending across locations or within a group of members.
With the right tools and processes, optimizing your SUM, and improving profits, is easier than you may think.
In this article, we’ll tackle the definition of SUM and how it can be utilized to improve outcomes and increase the value of your practice. We’ll also get into how modern procurement systems can help utilize automation to track and improve your SUM.
Let’s get started.
In a perfect world, every penny your organization spends would be well spent, helping you to optimize returns and supporting your growth and long-term business objectives. But in reality, dental organizations often struggle to achieve the company-wide visibility and control over their procurement spend they need to leverage collective purchasing power.
For DSOs looking to evaluate purchasing patterns and develop strategic sourcing and procurement practices, SUM is one of the most valuable metrics at your disposal.
Spend under management is the total amount of company-wide spend (across all locations) that is actively managed and follows company policies and guidelines. The figure can include all suppliers or spend categories and product groups but may be divided into separate metrics to represent specific locations, regions, or categories.
To calculate your SUM, divide the total spend that is actively sourced and follows company buying policies and guidelines by the total spend, then turn it into a percentage by multiplying your result by 100.
Example:
Total supply spend that follows company buying policies: $450,000
Total organizational spend on supplies: $750,000
$450,000 ÷ $750,000 = 0.60 × 100 = 60%
SUM is an important Key Performance Indicator (KPI) for DSOs because it reflects your maturity and ability to control purchasing behavior and prevent overspending, and other common inventory management and procurement mistakes, such as:
By keeping a watchful eye over your SUM, you can monitor performance and ensure you see improvements and slowly increase your span of control over spend by quickly nipping any employee or process issues in the bud before problems perpetuate.
Large DSOs with 15+ locations have started to lean towards centralized procurement. Centralized procurement is where a central office handles purchasing decisions and strategies, typically a Purchasing Director or Chief Financial Officer (CFO).
In contrast, decentralized procurement means purchasing activities are managed at the practice level. The benefits of centralized procurement include the benefits of scale, more efficient use of resources, extracting higher value from contracts, and improved spend management.
Having your company purchases under control allows you to drive business initiatives and unlock the hidden value that lies within your spend.
Strategic procurement strategies enable you to drive long-term business results to your bottom line. By taking a more holistic and service-centered view, procurement can unearth value and create competitive advantage by:
Implementing best procurement practices and inventory management can help improve operational efficiencies and contribute to a healthy EBITDA, making for a well-run practice, attracting investors, and increasing your market value.
Dental practitioners are in the business of providing health care, and most lack the business acumen or time to implement sound business processes.
When it comes to how they spend their dollars and procure the supplies they need to run their business and service patients, practices tend to lack intention and vision, relying on transactional purchases that simply get them through the day-to-day with no consideration given to the long-term impacts of their decision making.
Poor spend management creates confusion and leads to a lack of organization, inflated spending, and financial write-offs due to expired, damaged, or lost stock. Ad hoc buying fails to leverage your volumes, takes too much time away from and frustrates employees, and puts your practice's long-term viability and reputation at risk, including increased opportunities for fraud and theft.
If you’re profit & loss statement is seeing red, or you’re experiencing mounting debt, frequent financial errors, and poor cash flow, your organization, may have poor spend control. Causes of poor control over spend include:
Declining or stagnant reimbursement rates, rising costs, high employee turnover rates, and an increasingly competitive environment are some of the current obstacles facing practices. As a result, practices grapple with operational inefficiencies, increased operating costs, and cash flow problems, and maintaining control over spend becomes more complex and, yet, more necessary.
Hoping for improved profits and growth, many organizations focus on revenue growth, with cost reductions and process improvements taking a back seat.
However, while waiting, these organizations miss out on opportunities that could potentially make that revenue growth more profitable. Instead, by focusing on improving your SUM, you can maximize the dollars you spend while minimizing risks, improving cash flow, and bettering your business relationships, and ensuring your business grows — profitably.
Spend under management provides the foundation for a thriving, healthy business capable of setting and meeting organizational objectives, leading to trust and reliability within your organization and improved supplier relationships. This foundation of trust and reliability also reverberates outwards, improving your brand reputation with customers and within the industry.
Vendors, most especially when demand outpaces supply, are extremely selective and strategic as to where they spend their efforts and offer their most aggressive pricing. Simply put, wasting a supplier's time negotiating cost savings only to not follow through with the orders promised is a surefire way to demotivate suppliers and lose their trust and attention, along with their best pricing.
By improving your SUM, you ensure you can “say as you do and do as you say,” so those hard worked for price reductions and improved payment terms can manifest into realized profit improvements and a healthier EBITDA.
As your dental organization grows exponentially larger, so do the opportunities and challenges. For multi-location practices, capitalizing on opportunities and synergizing operations requires deep procurement analytics and reporting. The right tools will help identify problematic trends and patterns as well as highlight your procurement wins so they can be replicated across the organization.
Chief Financial Officers (CFOs) and Procurement Directors are challenged by disparate systems and a lack of standard procedures to manage their business spend. Manual processes reliant on numerous emails, faxes, phone calls, spreadsheets, and supplier portals are tedious, ineffective, and highly susceptible to human error.
This is why more and more dental organizations are choosing to leverage technology to remove information silos, streamline procurement best practices and gain control of spend.
A digital spend management platform can help you:
In order to manage your spend, you must first be able to see your spend. Unifying all your locations through one digital platform allows you to gain visibility on who is buying what, when, from who, and at what price.
Gaining a view of common items, spend categories, and suppliers allows you to easily identify where you hold the most potential for quick improvements and establish longer-term strategies to synergize operations and procurement strategies.
Rogue purchases that don’t follow purchasing protocols end up unaccounted for only later to surface as an unplanned invoice, contributing to budget blowouts and cash flow problems. Increased visibility ensures better data for all, including your finance department.
Spending time to strategically manage your supply chain can help you mitigate your risks and keep your practice safe while also having a big impact on your ability to save.
A digital spend management platform offers market visibility, so you can easily analyze supplier pricing and access documents for quality and regulatory compliance validations. So you can ensure your organization is selecting trustworthy suppliers with short lead times and competitive pricing.
As spend management allows you to control and reduce spend and has a direct penny-to-penny impact on profits, a comprehensive digital spend management platform that empowers you with market visibility, spend control, and real-time analytics enables you to execute strategy and deliver improved business results.
By offering a singular holistic view of your procurement data for every location under your management, Method’s digital spend management platform can help DSOs align their actions and decision-making with their business priorities.
Identify high-value suppliers and improve sourcing opportunities with a detailed product catalog of over 750,000 dental supplies and access to a 2,000+ dental-specific supplier database.
Make well-informed decisions and reduce risk with the control and visibility you need to increase your spend under management and:
Method provides you with actionable insights and helps you to measure your KPIs and ensure ongoing improvements, so you can meet your organizational objectives, improve your EBITDA, and make life easier for your employees while increasing the value of your business.
As CEOs and leaders well know, getting your employee “buy-in” is essential to the success of any project. To get employees on board, they must understand the benefits to the company as a whole, but even more critically, it’s important to let them know what's in it for them by presenting individual benefits such as less stress and chaos.
Remind them (and yourself) that change takes time, and this is an iterative process, but work done now will save time later. Let them know you’ve invested in a system that alleviates their workload and empowers them to buy faster and easier while making smart purchasing decisions for the betterment of the company and their future.
Support their success by making your expectations clear. Creating and communicating an official sourcing policy and procedure manuals will provide a reference for training and retraining employees and ensure clear and consistent communication. However, employees have questions or want to voice objections. It’s important to listen to them and provide resources for support.
Most importantly, align with the right partner with a proven track record of customer success that can deliver high adoption rates with a system your team will use, so you can get that spend under management and start your path to improved profitability and growth.
Ready to control your spend and improve your EBITDA? Contact us now to learn more and arrange for a personalized demo.
November 15, 2022
In early 2020, when Personal Protective Equipment (PPE) first became scarce due to sudden worldwide spikes in demand, healthcare providers quickly learned the impacts supply chains could have on their practice and ability to provide patient care.
Over two years later, the dental industry continues to battle increasing costs for critical supplies.
Supply chain professionals often refer to the "bullwhip effect," a term coined to explain how small fluctuations in demand can send ripples throughout the supply chain, leading to large distortions in demand further up the supply chain. Essentially, what are small issues downstream quickly snowball into much bigger issues the further upstream you go.
In this article, we'll let you know what you can do to ensure this "bullwhip effect" doesn't take a slash out of your production rates or your margins. You'll also learn how to handle procurement challenges and how procurement software can help you keep things moving and safeguard your practice.
But first, let's take a look at where we are.
Originally, the massive shift in purchasing behaviors and suddenly inaccurate forecasts compounded by stymied production made acquiring supplies difficult. In 2020 shipping delays and order backlogs became common. Now, it's pent-up demand, production bottlenecks, climate-related risks, and the ongoing Russia-Ukraine conflict at the root of continued supply chain issues.
The shortage of raw materials and components has begun to take a life of its own as the bullwhip effect makes its way through global supply chains. Although the U.S. has, in large part, moved on from pandemic-related disruptions, the supply chains it relies on are located in countries such as China that continue to be largely impacted by Covid-19.
The dental industry is no exception. Moving into 2023, dental practices face significant challenges as they are forced to combat price increases, find efficiencies, mitigate their supply chain risks and protect their profits and practice.
Although there's no going back to pre-covid times, and we must continue to adjust to the "new normal," fortunately, thanks to industry and technological advancements, the future is bright for dental organizations.
Now that patients and offices are back and offering more service models such as online appointments, practice owners and leaders can get back to meeting revenue and, more importantly, profit goals.
In a New York State Dental Association (NYSDA) article, Burke Spielmann, general manager at Henry Schein, explained that although demand for PPE has stabilized, the cost of supplies remains high, with the average spend on dental supplies jumping from 5.5% to 6.0% of revenue to 8.0% to 9.0%.
It's the basic laws of supply and demand, the same bottlenecks and overbuying that are delaying your goods are also escalating pricing. And demand is expected to continue to rise. According to new market research by Meticulous Research, due to the rising incidences of dental diseases, the increasing demand for cosmetic dental procedures, the increasing awareness of oral hygiene, and the growing medical tourism for dental treatments, the dental consumables market will be worth $67.6 Billion by 2029.
Although it's impossible to predict just how long supply chain disruptions are likely to continue. Looking ahead, as global supply chains continue to be stretched thin, it seems the only thing certain is that we should expect uncertainty.
They say necessity is the mother of invention. Faced with a labor shortage, an increasingly competitive landscape, and, as we've mentioned, rising supply costs, dental organizations have been growing in sophistication, leveraging new technologies to enable more mature procurement processes.
The modern dental practice is now focused on its profit and loss statement, aware that an effectively run dental practice with a healthy EBITDA is worth much more than one with a lot of revenue but not much actual profit.
For growing dental organizations, the future is digital, allowing for scaleable best practices that optimize cash flow while amplifying profit margins. Today, leading procurement platforms empower DSOs to leverage their collective volumes, control spending, and more accurately predict requirements so they can meet financial objectives.
In times of uncertainty, digitally enabled efficient procurement processes allow leaders to create a more agile and diverse supply chain where healthy competition thrives and risks are mitigated.
Traditionally, when procuring dental supplies, dental practitioners relied primarily on large distributors. However, new procurement platforms are changing the game, making it easier to compare pricing and stock availability across various vendors. The entire procurement cycle, from the identification of needs right through to paying the invoice, is now more efficient, helping organizations to do more with less.
Additionally, more mature dental organizations now have the visibility, insights, and control to implement strategic procurement for long-term cost and business advantages.
CIPS suggests you reduce the bullwhip effect by leveraging technology and sharing knowledge with suppliers.
If supply chain partners can determine the root cause of the bullwhip effect, you may be able to avoid it. Incorporating technology can help facilitate internal and external communication on risk areas and root causes. Critically, in case of a supply issue, it can also help you decrease your response time, allowing you to quickly find alternative sources and have supplies delivered before it impacts your practice.
CIPS further suggests you can reduce the bullwhip effect by:
We'll dig more into how automation can help with the above later. In the meantime, here are a few other things you can do to get a handle on your procurement challenges.
Fulfillment centers are experiencing high levels of demand. By streamlining your ordering, you can help to alleviate the pressures while reducing your own overhead. Customers often order many times per week or even per day, overloading vendors, their employees, and their supply chains unnecessarily.
Due to poor inventory management and procurement practices, practices often wait until they run out of an item before they reorder. However, it's important to remember no matter how little the order, it must still run through every step of the procurement cycle (identifying the need, selecting the supplier, placing the order, receiving the product, and paying the invoice). Every step takes time out of your employees' day and adds labor costs to your overhead.
Additionally, you're likely incurring extra fees for expediting deliveries. Instead, by better managing your inventory, accumulating orders, and ordering in more financially beneficial quantities, you can reduce costs, make life easier for your employees, and help unclog your vendor's order pipeline while you're at it.
Dentists and hygienists can be picky about the specific brands and products they like to use. On the other hand, best practice is to create and stick to a strict formulary. Although you want to control and limit the number of different products your organization buys, you also want to mitigate your risks and have approved alternatives from varying suppliers.
If your practice uses a formulary, consider creating a second alternative one. This will give your employees the flexibility they need to avoid stockouts in case of a supply shortage or delivery issue while still allowing you to control supply spend and minimize rogue purchases.
When choosing alternative products and sources, the more you know about your supply chain, the better you can strategize and choose sources that will help you mitigate your risks. For instance, approving the same brand-specific item to be purchased from two different dealers doesn't help you if the manufacturer is experiencing an issue. In this case, you would be better off approving a similar product from another brand.
Although you always want to be cautious of holding too much inventory as it impedes your cash flow, comes with carrying costs, and puts you at risk of financial write-offs due to expired, lost, or damaged stock, now is not the time to run super lean inventories.
We need to be clear that this doesn't mean you simply buy lots of everything. Remember, a well-run dental practice with a healthy EBITDA (which is impacted by your purchasing behaviors) is a valuable one.
Instead, we suggest you carefully and strategically analyze where it makes sense to increase your safety stocks. Think about the items you use on a daily basis that have minimal to no risk of expiring, like masks. Perhaps instead of ordering every week or two weeks, you can hold a month's worth of inventory. In the case of logistical issues or extended lead times, this will give you more time to source supply while introducing minimal risk.
When demand outweighs supply, vendors must choose which customers are going to get the goods and which they need to disappoint. So it's no surprise that vendors will choose to remain loyal to the customers who have remained loyal to them. A distributor loyalty program may be a good option, as members will likely be taken care of first when things hit the fan.
This doesn't mean, however, that you should put all your eggs in one basket. For the reasons we've mentioned, in 2023 and likely beyond, having alternative sources helps you mitigate your supply chain risks. The healthy competition also gives you more negotiating power and helps keep your suppliers diligent.
That being said, you don't want to spread your purchases out too thin. When selecting suppliers, remember the value loyalty brings and balance that with the pennies you may save purchasing elsewhere, as those pennies may cost you plenty more in the long run.
Dental practices require supplies to run. From PPE to crowns and composites, the list of supplies needed to provide optimal patient care is a long and technical one. The goal for any dental organization should be to buy these items in the right quantity, at the right time, and, of course, at the right price.
However, supply chain issues, price creep, incorrect invoicing, and overbuying are just some of the challenges that practices must first overcome. This is why, to ensure your practice sees continued growth, you must aspire to more elevated procurement practices that enable you to control supply costs.
The dental industry is a competitive market where efficient and effective supply chain management that drives out costs and supports growth can become a significant competitive advantage, and procurement software is the key.
In order to scale, an organization requires standard, repeatable processes that optimize outcomes. Method's spend management platform was designed to deliver, providing dental organizations with a scaleable, easy-to-implement solution with a low barrier to entry and a quick Return on Investment (ROI).
Streamlined e-procurement empowers DSOs with complete visibility and spend control across locations, allowing you to:
Method was designed to optimize the entirety of the end-to-end procurement cycle, from identification of requirements, price shopping, requesting and analyzing quotes, selecting suppliers, entering order requests, approving orders, and receiving shipments to paying and verifying invoices.
Designed by people in the industry for the industry, Method was built to be flexible. So no matter how rudimentary your current purchasing process may be or how big you want to scale, Method can help you shop a little smarter today and slowly refine your processes as you go.
One thing is for certain, procuring the supplies necessary, efficiently and effectively, must remain a top priority for DSOs and single office practitioners throughout 2023 and, likely, beyond.
Offering a superior user experience Method's full, end-to-end inventory and order management platform, ordering dental supplies is straightforward and hassle-free. In addition, our customer success team helps ensure quick implementation, high adoption rates, and continued usage across your organization, making for fast returns.
Rest assured, however, Method stays with you along the way. Acting as a true partner as you grow, Method will assist you along your procurement journey, helping to guide your transformation as you improve your practice and your profits.
If you're ready to begin your journey procurement that mitigates your supply risks,
Contact us to find out more or arrange for a personalized demo.
November 7, 2022
Your dental practice overhead is all the expenses you incur in running your dental practice.
Once upon a time, dental practitioners worried little about business factors such as overhead, as prices and profit remained relatively stable. However, as costs continue to rise as quickly as competition, and low insurance reimbursement rates and dwindling patient loyalty continue to hinder a practice's financial outcomes, cost control has become imperative to profitability.
It can cost quite a bit to operate a successful dental practice. But by exerting some discipline over how you manage your expenses and keeping your costs in check, you can improve your profit margins and add thousands of dollars to your bottom line.
Let's take a look and how you can calculate your overhead, including the full dental practice overhead breakdown, the ideal percentages for each of the different overhead categories, and how items in each of your categories should be allocated.
First, look at your Profit and Loss (P&L) statement, and you should see your quarterly or yearly gross income, followed by a list of your expenses. These expenses, of course, come out of your profits and make up your overhead and should consist of:
If you don't see these expenses broken down on your P&L report, you'll have to find the expense accounts they're located in. However, to ease things moving forward, we suggest you use separate expense accounts for each of these items in your chart of accounts.
Once you've located all your costs, you can start to add up each of your expenses. Once you have the total expenses, you can calculate your dental practice overhead by dividing them by your gross income.
For example, if your expenses total $100,000 and your gross income totals $75,000 then: 75,000 divided by 1,000,000= .75
.75 x 100= 75% overhead (as a percentage of your income).
Note, one important thing to remember is to exclude any compensation or related expenses of the owner, associates, dentists, or the owner's family. Here are some examples of expenses you should not include:
Dental overhead benchmarks act as a measuring stick, allowing you to compare your dental overhead costs to the industry average.
By understanding what your dental practice overhead consists of and setting benchmarks, you can set targets and make sure your costs don't get out of control and erode your profits. Paying close attention to and controlling your costs ensures that more of your revenue makes it to your bottom line.
To benchmark your results against industry averages, the average percentage of income per category is as follows:
Personnel costs include your staff's compensation expenses, recruitment or hiring costs, and employee benefits.
Personnel expense accounts include:
The goal is to get a big clear picture, so avoid separating every small expense and keep things simple by separating only essential expenses such as your staff's gross pay.
Dental supply costs and laboratory fees fall under the clinical costs category.
Clinical cost expense accounts can include:
If your dental organization has an in-house lab and a lab tech employee, you'll want to include the lab tech compensation in the clinical category. However, any outsourced lab work is to be included in the Laboratory fees expense account.
Also, dental equipment over $2500, and the financing secured for the equipment is not to be put into the dental supply expense account. Instead, place these into the Dental Equipment fixed asset account.
The facility costs category includes the practice's physical space and any equipment within the space.
Facility expense accounts can include:
Do not include:
The above expenses are to be placed in the general business cost category.
General business costs are items most businesses would require to run but are small enough not to require their own categories, such as office supplies, bank fees, and membership dues.
Other business expense accounts can include:
Do not include:
Office equipment between $500- $2500 (record these in your small equipment account under your facility costs category).
Discretionary costs include costs such as travel or business lunches that aren't strictly necessary for running your business and, therefore, are up to your discretion. But if you want to cut costs, your discretionary expenses may offer some opportunities for easy savings.
Expense accounts included:
It may be hard to figure out which costs fall under other business costs and which should go into discretionary costs instead. However, it's important to keep them separate and not unfairly inflate one or the other. Remember, discretionary costs are nonessential, so if your business can run without it, the expense should be considered discretionary.
This expense category includes the practice's net profit (found at the bottom of your P&L statement), benefits and compensation for owners and all doctors, and other income that isn't derived from patient fees. Note, non-patient fee income may include any government grants or Covid-related funding you've received, employee retention credits, interest earned, and any credit card rewards.
Expense accounts can include:
Do not include:
Draws or distributions — these do not impact your profit and loss as they are not considered expenses and belong in your owner's equity account on your balance sheet.
Ready to optimize your procurement spend, and improve profits? Method's spend management platform can help reduce costs, improve cash flow and make life easier for your employees, so they can get on with doing what they're really there for.
Method was designed and built by people in the industry to support the unique needs of dental practices. Whether you're a large DSO or a single practice, Method is flexible enough to implement (and start saving!) now and robust enough to grow with you over time.
Providing you access to a detailed product catalog of over 750,000 dental supplies and a 2,000+ dental-specific supplier database, Method delivers an Amazon-like shopping experience that enables you to:
All with simple, flexible pricing. Ready to find out more? Request a personalized demo now.
October 31, 2022
EBITDA is a measure of a company's operating profit shown as a percentage of its revenue. The better your EBITDA margin, the healthier (and more valuable) your business. Therefore, steps to improve your EBITDA bring added value to your business. Unfortunately, supply price creep, poor purchasing habits, and supplier overbilling all adversely affect your EBITDA. But your EBITDA matters to your practice's bottom line and to possible investors, helping them determine if your practice is a wise investment. In this guide, we get into all things EBITDA, including what it is, why it matters, what affects EBITDA, and ways to improve it.
The acronym stands for: Earnings Before Interest, Taxes, Depreciation, and Amortization.
By removing all elements non-relevant to operations, the performance metric accurately measures your operating performance and your ability to generate profits, reflecting your practice's financial growth.
Knowing the EBITDA of your dental practice allows you, and possible investors, to compare your performance to others in the industry on a fair and level playing field.
EBITDA is a valuable tool when performing any of the following:
A reflection of growth potential, EBITDA offers subjective comparisons, showing potential buyers if a company is a wise investment compared to other companies. If you're a seller wanting to put your practice on the market, EBITDA will help you set the correct asking price.
As we've said, the strength of your practice is reflected in the health of your EBITDA, so if you're intent is to increase profits and, along with them, the value of your practice, it's essential to take strategic steps to improve it.
Practices aiming for growth tend to focus on attracting new patients and increasing production, but the key to EBITDA is more about working smarter, not harder. Although you still want to increase your revenue, focusing on the other aspects of operations that impact EBITDA first makes you more likely to see profit improvements faster.
Establishing the frameworks that allow for effective operations increases the potency of your actions, allowing you to do more with less so you can scale profitably.
To help you get there, below, we offer six ways you can improve your profits and your EBITDA.
Given today's highly volatile market, it may seem like maintaining pricing on your dental supplies is easier said than done. But maintaining price stability allows you to stabilize your EBITDA margin.
The most effective method for pursuing price stability is to utilize a spend management solution that enables you to implement the best practices that allow you to:
Remember, market conditions frequently change, especially in today's volatile world, and data can quickly become outdated. Therefore, we suggest you ensure the information you rely on is current and frequently updated, if not in real time.
Method was built to give you real-time visibility, allowing you to keep an eye on the market and your own specially negotiated pricing. With the right data, you can make strategic, facts-driven decisions that safeguard your profits and ensure you drive down costs.
Reducing your overhead is one of the fastest, most impactful ways to improve your profit margin and, therefore, one of the best places to start.
Unlike revenue, every penny you save makes it straight to your bottom line. That's right, $1.00 saved is $1.00 earned. In comparison, once you deduct expenses, you would actually need to increase revenue by $3.00 to increase profits by $1.00.
There are many ways to improve your operating costs, depending on your priorities and where you have the most opportunity for improvement.
Here are two of the most impactful areas to focus on when cutting operating costs include:
Eliminate unessential expenditures. By improving your procurement processes and implementing an order approval process, you can eliminate redundant orders and stop unnecessary expenditures before they happen.
Don't let them gouge you. Instead, shop around and understand market prices. You'll be surprised to see how much discrepancy between suppliers.
Method's spend management platform also gives you visibility on over 800,000 items and 2000+ dental-specific suppliers so you can make the most financially responsible buying decisions for your practice and stop overspending unnecessarily.
Leverage your volumes for deeper cost savings. Procurement analytics, spend controls, and a digital order approval process empower you to implement formularies, run Request for Quotes (RFQs), and optimize your spending, delivering long-term cost savings that make it straight to your bottom line.
Poor inventory management leads to increased costs and negatively impacts your cash flow, diminishing your working capital and your EBITDA. In addition, every supply you purchase that sits in inventory continues to tie up your practice's hard-earned dollars, and the item is now at risk of becoming lost, damaged, stolen, or expiring prior to use.
To improve your EBITDA, you need to shorten the time between purchasing supplies and collecting the revenue those supplies help you produce. Inventory management best practices allow you to align your business needs with your purchases, so you buy what you need when needed, ensuring you minimize waste and avoid costly write-offs due to expired or obsolete inventory.
The right solution should give you complete visibility over your inventory management and procurement process so that you can optimize your inventory levels.
Method's inventory management platform will help you identify your supply needs and provides you with the visibility, control, and data you require to more effectively manage your purchases. Know when it is time to order and determine the most economical quantity order to increase your working capital and minimize your risk of financial write-offs.
It may seem obvious that increasing your revenue will help you improve the EBITDA of your practice. Although it's far from easy, there are many strategies you can use. Here are a few ways to Increase Dental Practice Revenue:
Raise your fees (while staying competitive) by evaluating:
Increase production capacity by:
Expand the number of high-profit procedures you offer:
Offer financing options:
Implement a referral program:
Leverage automated emails to encourage bookings:
Increasing your number of active patients, improving your case acceptance rate, and investing in marketing to attract new patients can all help you improve your EBITDA.
For more, check out ways to increase dental practice revenue.
Managing a long list of highly technical dental supplies can be a time-consuming, tricky process.
A spend management platform with a short implementation period and a low barrier of entry can deliver a fast Return on Investment (ROI). Leveraging automation and streamlined workflows to improve efficiencies and avoid labor-intensive, error-prone manual processes reliant on a myriad of emails, phone calls, faxes, and supplier portals, digitizing can deliver almost immediate results.
Technology plays a critical role in improving your EBITDA. The right solution should be scaleable and capable of growing with you.
Method's platform is flexible and scaleable enough to work for you today and tomorrow, covering all areas such as RFQs, inventory management, spend control, budget monitoring, and data analytics.
Method has a proven track record of helping companies streamline their processes and control expenses, including identifying requirements, finding contract billing errors, and implementing more strategic procurement processes for long-term maximized cost savings.
Our customer success team is ready to help your business run more efficiently and grow that EBITDA.
Ready to Find the Right Method With Method? Request a personalized demo now.
October 25, 2022
The dental industry is experiencing a seismic shift in dental practice models.
According to the American Dental Association, while practice ownership rates have been on the decline, group practice affiliation has continued to rise. In 2005, 85% of dentists owned their practice. By 2019 the number had dropped to 76%, with 10% of dentists affiliated with dental service organizations (DSOs).
Everything DSO states that today, approximately 18-20% of dental practices are affiliated with a DSO, and notes that trade insiders predict that by the year 2025, that percentage will grow to 50-65%.
Read on to find out why so many dentists are electing to align with DSOs, how the DSO model works, the advantages it can bring, and how technology can help support the growth and success of dental organizations.
The Dental Service Organization (DSO) business model provides dentists with critical non-clinical business support. By managing the "business side" of running a practice, the DSO model allows dentists to focus on providing quality care to their patients rather than spending valuable time on business functions they don't necessarily have the knowledge, education, or abilities to complete effectively.
For veteran dentists fighting a human labor shortage, or new dentists with large student debts, DSOs alleviate the pressures of administrative tasks while providing oversight and accountability while delivering additional financial benefits.
More simply stated, DSOs allow dentists to spend their time being dentists while they take care of everything else.
Acting as independent contractors, DSOs can be thought of as business support centers that help to facilitate growth and success.
As those in the industry well know, running a dental practice comes with its own set of challenges. The realities of day-to-day life in a dental office can often impede growth and improvements and leave little time for even vital business tasks.
It's no wonder the DSO model is gaining so much traction, with all the serious benefits it provides to practitioners, patients, and investors.
As Helen Keller once said, "Alone, we can do so little; together, we can do so much." A dental service organization with multiple dentists all serving the same loyal client base is able to unite efforts, divide labor and take advantage of efficiencies of scale for the benefit of all. Its relevance to your specific practice, however, is determined by taking an objective view of your ability to manage patient care, growth, and operational efficiencies.
For dentists with high student loan debt, the DSO model offers a stable, predictable salary with no need to invest in a personal practice. Removing the need to manage and run their own business and worry about things like regulatory compliance also allows practitioners to focus all their efforts on providing top-quality patient care.
For solo private practices or private group practices, the DSO model can take a load off of overburdened shoulders and deliver significant advantages, including:
For example, compared to individual practices, DSO practices are much more likely to spend heavily on Google Ads, and the difference is tenfold when comparing large DSOs to lone practitioners. Only 6% of lone practices are buying Google Ads. Comparatively, 60% of large DSOs commit dollars to buy Google Ads.
Standard, repeatable processes, that optimize outcomes and minimize waste, enable an organization to scale. Method's spend management platform was uniquely designed with this in mind, providing dental organizations with the opportunity to scale quickly by leveraging automation.
Streamlined e-procurement provides DSOs with better visibility and spend control across locations, allowing you to:
From identification of requirements, price shopping, requesting and analyzing quotes, selecting suppliers, entering order requests, approving orders, receiving shipments, and paying invoices— Method was designed to improve the entirety of the end-to-end procurement process.
Designed by procurement experts specifically for the dental industry, Method provides everything you need for effective centralized procurement that delivers operational efficiencies and cost reductions while ensuring your employees remain focused on providing quality patient care.
With Method's full, end-to-end inventory and order management and an easy-to-use interface, ordering dental supplies is straightforward and hassle-free, ensuring quick implementation, high adoption rates, and continued usage across your organization, making for a fast Return On Investment (ROI).
Rest assured, however, Method's customer success team is with you along the way, setting you up for success and staying with you as you grow.
Acting as a true partner, Method will assist you along your procurement journey, helping to guide your transformation as you improve your practice and your profits.
Ready to start scaling? Learn how Method Procurement's spend management solutions can help you gain control of your spend. Get in touch with our team today or request a demo to see it for yourself.
October 12, 2022
Improving your procurement practices leads to better profits. However, in order to improve, you must first measure.
Key Performance Indicators (KPIs) are a popular, powerful tool for measuring performance in the areas that indicate you are on the path to reaching the objectives you are targeting.
Depending on where you are on your procurement journey, you may want to use some— or all— of these purchasing KPIs. If, for instance, you've just kicked off and want to ensure your endeavors pay out in dividends and deliver a fast procurement ROI, take a look at these 10 critical performance indicators that will help you measure your success.
If you're looking to build a procurement strategy and aren't sure where you should concentrate your efforts, monitoring your KPIs will allow you to understand your starting point and identify which areas have the most potential for improvement.
Without regularly monitoring your performance, you have no way of objectively understanding the effectiveness of your strategy and improvement efforts and may quickly veer off course.
To drive cost savings and improved efficiencies for better financial performance, you must track the metrics that matter the most. Below we get into 13 essential purchasing KPIs you need to be tracking to ensure you're procuring effectively and optimizing your bottom line results.
Aside from saving you money and reducing your overhead costs, your procurement initiatives should have many objectives that both keep your practice safe and save you money.
Following is a well-rounded list of ten KPIs that will help you measure and monitor critical improvement areas and purchasing behaviors, so you can save money, keep your practice safe and safeguard your long-term viability.
Build a successful, scalable procurement process model by keeping a watchful eye on the frequency of purchases, the accuracy of important documents, and adherence to buying policies and formularies.
Keep reading to find out what the KPIs are used to measure, how they impact your dental practice, and how Method may be able to help.
Keeping an eye on the number of suppliers you buy from helps you mitigate your supplier concentration risks by monitoring your level of dependency on suppliers. Relying on too few, or worse, a single supplier for any category heightens your dependency risks.
If a supplier suddenly closes their doors or is unable to deliver for any reason, you risk running out of critical supplies. This is especially important during times of high demand, raw material shortages, or supply chain disruptions, as these issues make it less likely that other suppliers will be able to fulfill your needs and increases your chances of experiencing stockouts.
But buying from too few suppliers may also impact your ability to negotiate. The right mix of vendors will help you create a healthy competitive environment where suppliers realize they need to sharpen their pricing and provide optimum service to secure your business.
Yet, buying from too many suppliers means you may be missing out on leveraging your buying power to drive cost savings. Other KPIs that track supplier performance and (realized) cost savings may help you determine how many suppliers you should have on your active list.
Tip: Method allows you to view your number of active suppliers at any given time simply by logging in to its dashboard analytics.
Order frequency (the number of orders placed within a month) provides insights into your purchasing habits and order workflow.
Efficient procurement processes lower your overhead. Every order you place takes time away from your employees and therefore comes with its own set of labor costs, from placing and tracking the order to receiving and putting away the goods and, finally, paying the invoice.
Batching your orders helps you streamline workflows, improve your procurement efficiencies, and avoid small order fees, additional shipping costs, or other extra expenses. Buying less often also allows you to take advantage of larger order price breaks or special deals for further cost savings. If you already have guidelines for each dental office to order at regular intervals, say once or twice per month, then the order frequency KPI will help you monitor adherence.
If your order frequency is too high, you may need to establish and/or document an official purchasing and inventory management process and train employees. On the other hand, if you already have one in place, it may be time to consider whether it's effective and what's driving the extra ordering.
Tip: Again, with Method's handy dashboard analytics offers, you can get a quick visual of the number of purchase orders placed by the week or month and see which way things are trending.
Invoicing issues are likely much more common than you think and could be unnecessarily increasing your supply costs. If you haven't implemented the three-way-match process, you're potentially paying more than you should. The three-way match process is a financial auditing process that validates all invoice information against the purchase order and delivery receipt prior to issuing payment. Inaccurate pricing, quantity errors, goods received in error, back orders, or damaged items are all issues that may cause an invoice to be issued incorrectly.
Invoice accuracy is an important cost-saving metric that allows you to monitor your suppliers' ability to invoice correctly.
If you see too many issues, it's time to have a talk and start holding your suppliers accountable. On the other hand, if you don't see any, it's time to wonder if you have a foolproof system for detecting errors.
Tip: Method's digital spend management platform can help you leverage automation for PO accuracy and implement best practices, such as the three-way-match process that highlights discrepancies and ensure invoice accuracy, before you issue payment.
Purchase order accuracy is crucial for two main reasons:
Tip: If you've implemented a digital spend management platform like Method that automates the purchase request, approval, and order process, your chances of errors drastically reduce. Method allows you to customize your purchase orders to ensure ultimate accuracy. For example, you can upload your personalized company standard terms and conditions and manage supplier-specific details such as payment terms.
Formularies or supply catalogs allow you to streamline your purchasing and inventory management, minimizing the number of different products your practice buys. This allows you to purchase more effectively and lower both your operating and supply costs.
For DSOs looking to leverage the consolidated purchasing power of all their locations to drive down costs, formulary compliance is of the utmost importance. If employees are complying with the formulary, this indicates you have control over your spending. You can then negotiate confidently, knowing you are able to direct future purchases to the supplier awarded the business.
After all, if suppliers are going to offer you attractive, below-market pricing, you need to make sure they see the volumes you committed to
If your employees are purchasing off formulary and you've already negotiated a deal, you may be losing out and paying more than you need to. Purchasing off formulary reduces your ability to maximize your purchasing power and should be nipped in the bud as soon as possible, making this a vital KPI to govern so you can stay on track and meet your savings targets.
A second formulary gives your employees a little more flexibility to ensure they can meet your supply demands or appease specific doctor requests for specific supplies while still controlling your spending and reducing the number of different SKUs your practice purchases. Although not every dental practice or DSO will require more than one formulary, if you have one, this is a great KPI to measure how often you need to order from the second formulary. If you've decided to implement a second formulary, you'll want to limit its usage to minimize the reduction of your purchasing power. You can do this by setting a guideline, such as allowing no more than 30% of your purchases to be from your secondary formulary. This would then set your KPI target, help you avoid rogue spending, and identify which offices may be having trouble adhering to policy, allowing you to gently nudge them back onto using the primary formulary.
Tip: Using our supply catalog tool Method allows you to create unlimited formularies. Users will then be given visual indicators throughout the platform on items that are on a formulary catalog.
Understanding the number of times each location has had to return products to a supplier can help you pinpoint if you have a problem, either internally or externally.
Product returns can stem from inaccurate or redundant ordering, supplier quality, or delivery issues. Although the occasional return shouldn't raise any flags, if you're seeing a high number of returns, consider adding another KPI, Vendor Rejection Rate, to help you pinpoint problematic suppliers.
Supplier returns can be costly to your business, tying up thousands of dollars in cash flow unnecessarily, consuming employee time to process the return and ensure credit is issued. Furthermore, if the supplier can't replace stock before you run out, this puts you at risk of stockouts and could hinder production and patient service levels.
If you think the issue may be internal (a quick chat with employees may help you understand the reason behind most of the returns), you may need to review your procurement process for possible improvements.
Tip: Method's digital procurement process can help you eliminate redundant orders and leverage technology to reduce human error and minimize returns.
It's no secret that procurement's main objective is to increase cost savings and improve profits. So it only makes sense you'll want to measure these two metrics. The cost reduction KPI compares historical costs to your current costs and measures the comparable savings from price negotiations or better decision-making as a percentage.
Breaking your savings down by suppliers and categories will allow you to see where you've achieved the largest cost savings, what initiatives or strategies have been successful, and where you may have additional opportunities. This will help guide your long-term cost reduction strategy.
Tip: Manual processes reliant on spreadsheets, emails, and faxes can make finding and calculating your cost savings extremely time-consuming. Fortunately, Method delivers everything you need to drive down costs and monitors your achievements for you; just check out the "savings over time" graph in our analytics dashboard.
Looking for more detail? Our deeper analytics with customizable reports can help you dig into details by item or supplier to identify where you've seen some wins and where you could be doing better.
The purchase order cycle time metric measures the purchase order life cycle, in hours or days, from the moment a purchase request is created and submitted for approval to payment of the invoice.
Decreasing your purchase order cycle times allows you to optimize your operational efficiencies and reduce overall procurement costs.
Monitoring your purchase order cycle time by the supplier can help you separate and categorize your suppliers by their ability to respond quickly to orders, categorizing them as fast, medium, and slow. This way, you'll know who you can rely on to quickly turn around urgent orders.
If you've implemented an approval process, this may be a good metric to measure your approval time and ensure approvers aren't bogging down the process and putting you at risk of running out of supplies.
Tip: Method's approval process with in-system notifications and email reminders helps your employees keep up with the approval process and minimize your purchase order cycle time.
Spend under management measures your strategically managed spend and helps minimize rogue spending. Strategically managed spend is the buying portion that aligns with your procurement strategy and abides by company rules and guidelines. In contrast, maverick or rogue spend does not follow company policy, and decisions are often made on the fly by the employee placing the order.
In order to realize cost savings, you must be able to execute plans and direct your future purchases.
Implementing procurement strategies to optimize your supply spend requires managers to enforce buying rules and guidelines that direct employees to where and what to purchase and at what price, ensuring specially negotiated pricing and terms are taken full advantage of.
But for DSOs with multiple practices, reigning in your locations and having them adopt new processes can take some time, especially if it means having to work with new suppliers or different supplies. However, consolidating your purchases to increase your buying power and leverage your total spend can result in significant savings, so it's worth your effort.
Categorized as a management or organizational KPI, this powerful performance indicator measures your strategically managed spend and has huge potential to help you realize the cost savings you worked hard to find. Allowing you to monitor your progress by location, this KPI can help you find value leakage and see where you may be allowing too much maverick spend and could be missing out on possible cost savings opportunities.
Tip: Method's flexible digital platform helps you monitor adherence to buying policies across locations, ensuring your purchasing aligns with your policies and opportunities are maximized for optimal savings.
Set strict, or not-so-strict, supplier rules, allowing employees to only buy from select suppliers, or blocking the ones you want to avoid buying from, so you can implement the strategy you see fit.
The purchasing KPIs we've highlighted are part of the essential frameworks and best practices that contribute to creating a scalable, effective dental organization that sets and meets its procurement targets.
However, you want to be leery of tracking more than is necessary. Few practices will need to track each one. Carefully selecting the KPIs that align with your main business objectives will help ensure you and your team remain focused and actively pursue success.
Method's digital spend management platform offers deep procurement analytics, helping you monitor your critical KPIs and providing the measurements you need to ensure you're on track to meet your business objectives.
Helping you identify areas for improvement and offering a scalable and flexible procurement and spend management process capable of growing with you, the Method way leads to a healthier, more efficient, and profitable practice.
Ready to take a look at the software you can leverage for a streamlined, strategic procurement process that saves you money? Contact us today for a personalized demo of our dental inventory management software.
October 3, 2022
Wondering how to value a dental practice? Accurate dental practice valuations are often necessary, but the many methods to calculate your market value can lead to confusion.
We've put together this handy how-to to help you paint a precise picture of what your practice is worth. We'll take a look a the multiple methods available and how you can combine them for a holistic, comprehensive approach to determining your practice's value.
If you're thinking of selling or buying a practice or simply want to be aware of your business's potential worth, read on to learn about the different practice appraisal methods for determining sale value.
Do you need a practice appraisal? The short answer is yes. But when, and for what, exactly?
To give you an idea, we've provided a list below of situations in which dental practitioners would need a current and accurate evaluation of the market value of a dental practice.
To ensure the accuracy of a practice's valuation, it is generally recommended that practice owners and DSOs perform practice appraisals annually.
A complete dental practice appraisal gathers all relevant practice information into a formal written report. The report is typically a short form report (referred to as a "limited" report) which ranges from two to four pages plus any supporting documents. The longer "comprehensive" reports, including supportive documentation, run between 25- 35 pages.
Although both reports require the same analysis and must be dated and signed by the appraiser, the difference lies in the amount of data and information included in each report. The limited report is a summary with little explanation regarding the data or findings. In comparison, the comprehensive report is thusly named as it includes significantly more data and in-depth discussion on determinations.
Various elements are considered when determining a practice's current market value. To come to a fair and precise valuation, you'll need to consider the following contributing factors:
As you can see from the above list, there is a lot to be taken into account when estimating the fair market value of your dental practice.
As the valuation methods available do not account for all of the factors within their formulas, we suggest you choose a method most suited to your business to come to an accurate appraisal. Looking at the specificities of your situation, find a method that factors in the elements that will most significantly impact your valuation.
Alternatively, you can use a few or all of these methods and then calculate the average of your final valuations for the most comprehensive result.
That being said, performing practice appraisals can be time-consuming. So, if, for your purposes, a rough estimate of your market value will do, then pick whichever method you feel will be easiest for you to complete.
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One of the more popular income-based methods, the capitalized excess earnings method, examines your current net earnings and considers the value of your anticipated profits to predict your long-term performance.
The method determines your practice valuation by dividing your net present value by a capitalization rate, which, depending on your practice size and type, can fall between 15% - 30%. A smaller practice would likely use a rate between 20% - 25%.
The method does have its challenges, however. For example, future earnings can be tricky to predict and is a major factor in the capitalized excess earnings method. Depending on the age of your practice, you may or may not have enough data. If you're short on historical data, you'll have to complete adequate research to ensure a fair and relatively accurate estimation of future performance and profits.
The method does have its challenges, however. Future earnings can be tricky to predict and is a major factor in the capitalized excess earnings method. Depending on the age of your practice, you may or may not have enough historical data to help you foresee the future. Therefore, you'll have to complete adequate research to ensure a fair and relatively accurate estimation of future performance and profits.
Another way to estimate your market value is to total your net assets, including tangible assets (equipment, computers, real estate, etc.) and intangible assets (brand awareness and reputation, intellectual property, patient lists, etc.).
Intangible assets will be more difficult to appraise, so your final valuation may not be as accurate as if you used another method. However, if you know you've performed well in these areas, you may not want to completely disregard it. Instead, we recommend using at least one other method to give you another reference point or a few to average the results.
The Annual Net Receipts (collections) method measures a practice's value based on its average annual net receipts over the last three years and is stated as a percentage.
Typically the percentage falls between 50% to 80%. So, for a dental practice with annual net receipts of $1,000,000, value would fall between $500,000 and $800,000. The actual percentage utilized is determined through a comparative analysis of other practices sold in the region or state within the last few years.
Because the method considers collections and not profit, the percentage applied can vary greatly. However, valuing a practice based on collections alone fails to consider operating costs, how effectively the practice operates, and any changes in reimbursement or future receipts.
Therefore, the method may not be appropriate for many situations, such as setting a sale price or bringing on investors. However, the method is valuable for analyzing collection performance and trends and can be a handy measuring stick.
Similar to the capitalized excess earnings method, this technique uses the average net earnings available to the business owners, typically averaged out over the last three years. However, it does not take into account doctor compensation as a percentage of doctor production.
A factor is determined by comparing the sales and purchases of other dental practices during recent years and within the same state or surrounding area. The annual net earnings are then multiplied by the factor.
As the method ignores doctor compensation for their portion of production, if a doctor produces a large portion of the practice's overall collections, this method will likely produce a higher valuation compared to the capitalized excess earnings method.
However, if practice production is generated by other individuals (rather than the doctor), then the capitalized excess earnings method will produce a higher evaluation than the average annual earnings method.
This method allows you to calculate your valuation based on estimated future cash flows by looking ahead ten years, forecasting your net income over the next ten years, and calculating the value of the total income adjusted for the time value of money.
To calculate this, determine your expenses and projected growth rate for each year, then multiply them by a discount rate to calculate the present value of your future cash flows. The accuracy of this method may be questioned, however, as the method is heavily dependent on estimating future cash flow.
Method's spend management platform can help DSOs and practitioners reduce overhead, increase profits and improve efficiencies for improved profitability. Our flexible, scaleable procurement solution allows you to monitor and better control your spend, approve purchase requests and stop accessive spending before it happens, so you can stay within budget and reach your targets.
Gaining visibility on 800,000+ dental supplies and 2,000+ dental-specific suppliers, a user-friendly Amazon-like shopping experience that shows you product availability, public or your own special pricing ensures your employees make the best buying decision for your practice.
Our intuitive ordering system lets you know when it's time to order and even how much to order so you can improve your cash flow and avoid stockouts.
Streamlined, automated workflows reduce errors and the time it takes to manage your long list of dental supplies, so your employees can get on with what they do best, taking care of your patients.
A personalized demo will help you see how Method works and just how easy the road to improved profits can be. Call us now for a personalized demo.
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September 27, 2022
For DSOs with clear business targets and performance objectives, Key Performance Indicators (KPIs) are a vital performance measure that enable you to monitor your progression. Although you may have a sound growth strategy and execution plan, if you're not monitoring the results, you can quickly veer off course. Using the right KPIs that measure your most critical value drivers allows you to see where improvement is required and affords you the time to correct your course of action to meet your targets. Let's look at the 12 KPIs DSOs should use to monitor crucial areas such as production, patient activity, service levels, and costs and profits.
The dental industry is quickly becoming increasingly more competitive. Prospering amid the competition and safeguarding your long-term viability requires you to outperform your competition in all areas, including providing top-notch dental care and excellent customer service, otherwise, you risk losing the very patients you worked so hard to gain.Although high patient volume may give the impression your practice is doing well, the truth lies in the details.KPIs ensure objectivity, providing a measurable value showing how effectively your practice achieves its key business objectives. Measuring KPIs allows you to see where you've improved and have seen growth while offering valuable insights into the specific areas that need attention.Here are twelve KPIs DSOs need to know — and utilize — to identify performance gaps and improve their processes for better results.
We've listed it first for a reason. For obvious reasons, Total Practice Production is considered the most important KPI for dental practices. Production growth is directly co-related to long-term business performance. As your fixed costs such as rent and insurance remain, well, fixed, and do not change, the more you increase your production, the higher your rate of return.But you know the saying you can't improve what you don't measure. Therefore, tracking your production daily, weekly, monthly, quarterly, and, of course, annually is critical for DSOs, providing you the benchmarks you need to set and evaluate your production and collections KPI targets and determine your overall practice performance.An increase in production is a good sign that things are being done right, while a reduction in production rates or failure to meet targets may flag an underlying issue that needs to be addressed.
Although production rate is a vital indicator of your practice's overall performance, your ultimate goal is profits. Sadly, unless you manage to collect, production negatively impacts your profits, creating overhead by costing you in employee time, supplies, and missed opportunity — you can't make back the time lost on caring for patients whose bill remains due.Your total percentage of collections can make or break your profits, reducing your income and impeding your cash flow. If you compare your Total Practice Production to your Total Collections and find you're experiencing a large gap, then it's time to identify the underlying problem.Are you participating in an insurance plan with a high rate of write-offs? It may be time to reconsider your participation in those plans. Or, perhaps your team is under or newly staffed and is failing to verify dental insurance as it should be, or you have a backlog in accounts receivable that needs to be addressed.Either way, you want to keep your eye on- and maximize- your collections, getting as close to your net production rates as possible. But to give you something to gauge against, on average, we believe a good collections percentage should be between 91% to 98%.
Although providing top patient care is of the utmost importance to all dental practitioners, to remain viable, a practice must remain profitable. Therefore, every DSO and single office practitioner should have a KPI targeting practice profitability. The math is simple, just take your total collections minus your total overhead. The balance is your profits, which may be directed toward growth plans, improving your practice efficiencies with technology, or increasing employee or personal income.Regardless of how profits are spent, tracking how much you profit is important as it is also a good gauge of your performance in its three inputs — production, collections, and overhead. If you're unhappy with your results, take a look at those three key factors for opportunities for improvement.Before running ahead on plans to increase production, improve your collection rates, and reduce your overhead. First, we suggest you take a moment to ensure you understand exactly how each area impacts profits and determine what your likelihood of success is vs. the resources and time required. This will help you evaluate your risk and ensure you're focused on the initiatives that are most likely to have the fastest and biggest impact on your profits.For example, gaining new clients can be a costly, requiring expensive marketing and having no guarantee of success. Comparatively, if you manage to save on dental supplies, every dollar you save goes directly to your bottom line. When it comes to increasing profits, we've estimated that saving one dollar is equivalent to generating $2.94 in revenue. And unlike the new patients that may or may not make their way into your door, the control is in your hands, to buy, and save, when you're ready.
Often referred to as the silent killer, high overhead can easily go unnoticed and quickly erode your profits. As the dental industry grows more competitive, and supply prices continue to escalate, controlling your overhead has become more critical than ever before.Waste comes in many forms, including inefficiencies, overspending, and lack of expense control. These areas offer great opportunities for competitive advantage but, when ignored, can do great harm. Establishing an overhead target allows you to monitor your performance in these critical areas that can otherwise silently kill your business.According to a study done by Dental Buyer Advocates, between 2010- 2020, depending on the size of the dental practice, the nationwide median overhead for practices ran between 63.4% and 64%.Although this is a good benchmark for your overall overhead costs and is an important KPI, it's difficult to decrease fixed overhead such as rent or payroll. By having a separate KPI for dental supplies, you can keep an eye on the costs you can (and should) control.Although ideally, a dental practice should spend 4% to 6% of its overhead on supplies, according to an Aldrich report, in reality, the average single dental practice spends 7.2% of collections on supplies, showing there's plenty of room to reduce costs and improve your profits.Luckily, from streamlining processes to managing inventory and buying more effectively, there are things you can do to cut unnecessary spending and make your dental office more cost-efficient.
Active Patients is a commonly used KPI, but it can be unintentionally misleading. Whether a patient is active or inactive, you should be actively working on (see what we did there?) getting them back into your office for a recall.Although you'll naturally lose some patients if they've moved out of town or due to extenuating circumstances such as job changes, patients often don't come back for hygiene appointments simply because your front office isn't following up or being persistent enough.Active patients also represent an opportunity for growth in the form of referrals. In a healthy practice, it is estimated that 70%–80% of new patient referrals come from existing active patients.By comparing your total patient count to your active patient count, you can see how many appointments and chances for referrals you're missing out on and identify issues. For instance, if you've noticed a large spike in new patients yet no increase in hygiene appointments, this should flag you have a problem somewhere in your process.Similarly, if your active patient count has steadily increased but your total patients remain stagnant then it may be time to review and improve upon your referral program.
Data from the Levin Group Data Center shows that although the percentage of active patients currently scheduled should be 98%, most practices are falling short, coming in under 85%.Many dentists and DSOs continue to be focused on attracting new patients while turning a blind eye to the number of patients leaving to find another dentist. In today's environment, any patient without a scheduled appointment should be considered a potentially lost patient that needs to be recovered.A healthy practice with growth potential should be able to show an increasingly active patient base. Rather than focusing on new patients for revenue growth, practice owners and DSOs should focus on delivering the best care experience they can provide, offering patients more choices and increasing the value derived from each patient.
You should see your average production per patient increasing annually. This important KPI shows a patient's financial worth to your practice. If it's not increasing, it's likely heading into a decline, providing you with an advanced warning to implement strategies such as introducing a new service or increasing whitening cases to improve performance.Due to the lack of care a patient has experienced that caused them to find a new dentist, new patients are often diagnosed with larger cases. Hence, with a separate KPI, average production per new patient helps to monitor performance in this area more accurately, allowing you to optimize its full potential.Although many practices see an increase in the production rates with new patients, it's still often not what it could be. The average production per new patient should be approximately two to three times higher than that of a standard patient. A new dentist will also see things with a fresh perspective and may be able to suggest treatments for the first time.
There is no standard target for new patients. The number should be aggressive yet attainable. Dentists and DSOs need a thorough understanding of their production goals, historical performance, and capacity for growth and take these into account to calculate a new patient growth target.Due to the nature of their services, in some specialties, such as oral, endodontics, and orthodontics, most patients are new. In these cases, the target will likely be higher than 90% of all revenue.In general practice, a practice's production is produced by the dentist and the hygiene department and consists of hygiene patients, emergencies, and new patients. Each should be given its own KPI taking into account the overall annual production goal.
Remember, it costs more to acquire a new patient than it does to retain and upsell services to current ones. According to Cleardent, five times more.As dental practitioners continue to face significant challenges and an increasingly competitive landscape, it's easy to see why patient retention has become critical to a practice's success, much more so than acquiring new patients.Patient attrition (the number of patients you lose) should be calculated annually. Henry Schein reports that the average attrition rate in dentistry is 17 percent. This will help you gauge how you're doing. However, as they note, top-performing practices often have an attrition rate of just three percent.From marketing costs to the extra time you spend engaging and evaluating their cases, new patients can be expensive. Once you've established the patient relationship, remember to nurture it to make sure you retain them with careful treatment plan follow-ups, hygiene recalls, and all the niceties like holiday cards that remind them you're there.
Tracking new patients is a must. But you should also be interested in your hygiene recall appointments as it's a good indicator of overall practice growth.As their doctor, you want to make sure you're seeing your patients and that they're getting and staying healthy. Plus, as we've said, it's more cost-effective to keep existing patients than it is to gain new patients, so you want to ensure the bulk of your income is coming from your current patient base.Take a moment to review how many recall patients you see every week and if your hygiene department is growing in ratio to your new patients. For example, if you've had 1000 new patients and they had come in twice throughout the year for cleanings, that's 2000 more hygiene appointments you should have added. Did you? If not, it could mean you're losing patients.
Your case acceptance rate is a clear indicator of how well you're performing examinations and communicating proposed treatments to patients, but it also shows you how much production you may be leaving on the table.But don't let the numbers fool you, there could be more opportunity for improvement in this area than what first appears.One of the most variable KPIs in the dental industry, Case Acceptance Rate, must be taken with a grain of salt. As it can be misleading, it's important to understand how it works.Generally speaking, the larger the case, the lower the level of case acceptance. Therefore, as most practices have a fairly low average production per patient, case acceptance is high.Due to how it's calculated, the acceptance rate KPI can offer a false sense of security. For example, If you've diagnosed a patient with needing four crowns and they accept only the one their insurance will cover, although you've missed out on three crowns, this would be counted as an accepted treatment.This skewed, incomplete view makes the acceptance rate look falsely high. Meanwhile, patients may not get the required treatments, and you may be losing out on production opportunities.
Cancellations and no-shows should be rare in a doctor's schedule. However, if patients aren't making it to their treatments, it's time to look at why. It may be that your office failed to make financial arrangements prior to scheduling the appointment, and the patient had yet to truly be "sold" on the treatment and made the appointment with no little to no intention of following through.Monitoring this KPI will help you identify if you have a sales problem and need to review how you're communicating the importance of hygiene to your patients or if there is a quality problem and you need to improve on the level of service you're providing at each visit. Either way, if you're unhappy with your cancellation rate, it's a good time to audit and review your reminder and confirmation procedure to see if retraining or procedure improvements are necessary.When scheduling overdue inactive patients, keep in mind that their cancellation rate will be naturally higher, perhaps as high as 20- 25%.Keep in mind that if your hygiene department is growing and your daily production is good, a few missed appointments are nothing to stress over. But if you see a trend of increased cancellations, that should be something that triggers some action.
Leveraging procurement data analytics to monitor key performance indicators gives you the foundational measurements you need to ensure you are moving in the right direction, identifying areas for improvement, and creating a scaleable process and profitable practice.Contact us today for a personalized demo of our dental inventory management software, and take a look at the software you can leverage for a streamlined, strategic procurement process that saves you money.
September 19, 2022
Keeping track of your dental supply inventory is integral to controlling your overhead costs. For DSOs and single-office practices looking to improve profits and mitigate their risks of stockouts and financial losses, keeping track of inventory should be considered a critical part of their standard business processes.
It’s no secret that stockouts can hinder your ability to service your patients, damage the reputation you work so hard to build, decrease your revenue, and further impede your profitability, leading to costly expediting and shipping costs. But stockouts aren’t the only issue arising from poor supply inventory management.
In this article, you’ll find out what inventory tracking entails, review some basic stock control techniques, and learn how they can benefit your practice. We’ll also get into what you should look for in inventory management software.
Read on if you’re ready to leapfrog into efficiency, get control of your supply spend, and drive cost savings.
Inventory tracking is the process of tracking all supplies required for production. This includes all SKUs currently being held within your practice and monitoring all inventory movement and activity internally and externally throughout your supply chain.
It also includes tracking purchases through the usage of purchase orders, recording deliveries by adding received quantities into inventory, counting on-hand inventory to validate inventory levels, and accounting for usage by withdrawing quantities from inventory as they are pulled from stock.
A keypart of inventory management and procurement, inventory tracking ultimately aims to ensure you always have the right products, in the right quantities, at the right time to meet your production schedule.
It also mitigates your risks of losses through overpayment, theft, fraud, redundant orders, and the mismanagement of inventory.
Keeping track of your inventory helps you work more effectively, allowing you to do more with less.
Your dental office is a busy place, and your employees are likely responsible for many tasks. And if things are going right, your schedule should be jam-packed. However, by establishing a clear process for tracking inventory, you can ensure to have the supplies you need to service your patients in the right quantity, avoid stockouts and minimize carrying costs while keeping the funds tied up in your inventory to a minimum.
Although it may seem like a cumbersome, time-consuming process, when implemented effectively, inventory tracking practices can help you reduce carrying costs (the costs of carrying excessive inventory), decrease supply costs, maximize productivity and mitigate your risks.
As a bonus, you’ll also be able to calculate your inventory turnover and supply usage.
Is any of this a big deal? Well, let’s run through it.
Carrying costs. The costs of buying, storing, and managing inventory — may seem inconsequential. However, they typically average 20 to 30% of the total cost of inventory and can take a nice bite out of your profits.
Cashflow. Too much money tied up in excess inventory hinders your cash flow and may mean you don’t have the funds you need for other critical items, such as paying your employees, buying or repairing equipment, or scaling!
The right quantity. Holding the “right” quantity of each supply means you are purchasing at the right time and at a quantity that is most economical for your practice, taking into account any available volume price breaks suppliers offer, as well as average usage and current inventory levels. This reduces supply costs and ensures supplies are used before they expire or get lost or damaged, minimizing your risk of financial write-offs.
Inventory turnover. Once you’re tracking your inventory, you’ll be able to better understand your inventory turnover (how much you use of each item over a given time period). Calculating your inventory turnover and supply usage is the first step in leveraging your volumes for price reductions.
It can even be used to organize your supply closet. This helps to increase office efficiencies by reducing the amount of time your employees waste sifting through the inventory to find the supplies they need, and again, reduces the likelihood of damage, loss, or expired product, allowing you to implement FIFO (First In, First Out).
Lastly, tracking your inventory can help you avoid fraud and theft. While you always want to trust your employees, opportunities for fraud stem from a lack of internal controls. Without tracking your inventory, implementing best practices, and performing the three-way match process, you leave opportunities for employees and suppliers to take advantage of.
Tracking inventory for dental supplies doesn’t come without its challenges.
It only stands to reason that the more inventory you have, the harder it is to track. Now, add to this the complexity of your dental supplies.
Dental practices require a long list of supplies. Varying only slightly in the specification, the long SKUs used to identify each item differ only slightly from one another and can be difficult to distinguish. As a result, ensuring the correct identification of each item in your inventory can be tedious and difficult.
Unless you’ve neatly organized your supply closet and minimized the areas outside of the supply closet where you hold inventory, a lack of organization may further slow down the process.
It’s apparent that without the right system, inventory tracking can be time-consuming, hard to do accurately, and can quickly overwhelm your employees. Given that your employees likely have a myriad of tasks they’re responsible for, and you may even be short-staffed, you simply can’t afford for your employees to waste too much time tracking inventory.
Luckily, you don’t have to.
Let’s be honest. There are best practices, and then there’s good enough. How you decide to track your inventory depends on where you are as a business. There is no point in establishing processes that are simply unattainable for your practice.
Instead, remember the Kaizen philosophy, and focus on establishing a gradual adoption of small yet impactful improvements.
Instead, we suggest you take an honest look at your available resources (human, financial, and technological), the benefits of tracking inventory, and your business objectives before deciding what makes sense for your practice.
Instead of making a quick jump, DSOs may want to lean their way into lean inventory management.
Here are a few approaches that may get you there.
If you’re new to tracking inventory, keeping it simple and putting pen to paper for a quick inventory count may be a great first step.
Given the complications we mentioned above, unless you’re highly organized and your stock taker is meticulous in paying attention to detail, you may be opening the door to errors and wasting valuable employee time.
If your count is inaccurate or incomplete, you may still experience stockouts. And keep in mind that you’ll need to transpose this information into a spreadsheet if you want to estimate your supply usage for demand forecasting, improve cash flow, avoid stockouts and negotiate better deals.
A step above pen and paper, an inventory tracking spreadsheet will allow you to save your history so you can accumulate essential data to be used to establish reorder points and order quantities and negotiate cost savings based on volumes.
Is it possible? Yes, dependant on your resources. Is it efficient? No. Is it effective? Mildly so.
Although a spreadsheet offers no help in terms of the challenges of counting and tracking inventory, as the process is electronic, it offers DSOs a first step in aggregating and sharing information across locations.
This information can then be used to move on to the next process, finding and implementing the right inventory management software.
By introducing inventory management software into your practice, you can increase your efficiencies with streamlined workflows, leverage automation to eliminate human error, track inventory in real-time and make life easier for your employees.
A good inventory management platform should help you:
From counting stock to relying on intuition to estimate supply needs, manual inventory takes your team’s attention away from servicing your patients and their various other tasks while simply being ineffective.
Luckily, the birth of SaaS software has now made Inventory Management Software accessible to dental practices of all sizes, providing you a quick-to-implement, scaleable process with little barrier to entry.
By leveraging software, you can eliminate your inventory tracking challenges, control and optimize your supply spend, and scale your business, profitably.
Our dental supply management software provides a standard, scaleable process for tracking inventory and staying on top of your supply needs while ensuring you use funds wisely and spend no more than you need to.
Best yet, Method’s inventory management tool is flexible enough for you to implement today and yet robust enough to grow with you over time.
We provide you with the controls and methods you need to align your internal processes and purchasing decisions with your business objectives. We help you meet your business targets by enabling you to drive cost savings, monitor against budget by location and category, and implement and enforce buying rules and formularies with purchasing controls set across a single or multiple locations.
By connecting your team through a single platform, your employees can work more effectively, communicating and collaborating on orders and sharing documents both internally and externally with supply partners.
With Method, managing inventory, shopping, and buying supplies all becomes easier and faster, avoiding all the emails, phone calls, faxes, and numerous supplier portals and spreadsheets your employees would otherwise have to rely on.
We help you track and manage your supply inventory and purchases effectively so you can optimize profits and continue to scale.
Method’s marketplace makes it easy for your employees to shop and quickly make the best purchasing decision for your practice, bringing the dental supply market to your fingertips.
Like Amazon, our marketplace allows you to search for the right supplies with 750,000+ dental-specific items in our catalog and quickly compare pricing and availability across 2,000 + suppliers.
Plus, we’ll help you:
Don’t just negotiate- realize cost savings with the purchasing data and control you need to leverage your volumes effectively.
For more information on what we offer or to find a package that suits your needs, click here.
Ready to get started on your journey to cost savings? Request a personalized demo or contact us for more information.
September 12, 2022
Maintaining the right level of inventory on your dental supplies can be tricky. Stock too much, and you risk running into cash flow issues, incur high carrying costs (the costs of buying, storing, and managing your inventory), and increase the likelihood of damaged, lost, obsolete, or expired inventory. Simply put, if you want to control your overhead costs and optimize profits, you’ll want to avoid overbuying your dental supplies. On the other hand, buy too little, and you risk running out, and that can be bad for business. Strike the right balance, however, and your balance sheet and your employees will thank you for it. But without the right know-how, it’s easier said than done. But rest assured, we have you covered. Below we get into the costs and causes of stockouts, how you can avoid them, and how inventory management software can help you better manage your supply inventory and grow your practice.
There aren’t too many repercussions if you run out of office supplies like pens or printer paper. Sure, it may be annoying to employees, especially the one who may need to run out to pick some up or has to place a rush order. However, running out of an item you need to service a patient, or worse yet, all your patients, brings much more harm to your practice. Stockouts can lower your productivity and efficiencies, increase your supply costs with rush orders and expediting costs, and, even more critically, hinder your ability to provide optimal patient care and bring harm to your reputation. Ultimately, stockouts decrease your revenue and profits, frustrate employees, damage the patient relationships you work hard to build, and threaten your practice’s growth and long-term viability.
Stockouts can happen for many different reasons. Factors such as underestimating your requirements, major shipment delays, and a lack of cash can all lead to a critical dental supply being out of stock. Here are some of the most common causes of stockouts:
The above list may seem lengthy. But the dental supply chain is a complicated one, and plenty can go wrong. Your supplier may be experiencing production delays due to raw material or labor shortages. Or maybe a hurricane stopped a shipment in its tracks. Although it may feel as if stockouts are inevitable and out of your control, there is plenty you can do to mitigate your risks and avoid stockouts. For some, it may start with a simple task such as creating an inventory list to help your employees manage the very long list of supplies you need. Read on for tips and tactics to avoid stockouts.
There are many strategies for avoiding stockouts. Which ones you use or prioritize will depend on your practice. First, we suggest you review the list we provide below and identify your gaps. Some of what we suggest you may already have in place. Second, it’s important to know where your most significant risks lay. We suggest you take some time to consider when you last dealt with a stockout and the reason behind it. You should also review your supplier’s service and delivery performance. This may help you prioritize implementing certain strategies over others. Lastly, prioritize your projects based on your availability of resources, the impact you’re looking to drive, any added benefits a certain tactic may bring as well as your overall business objectives. Finally, here are our tips and strategies for avoiding stockouts:
Lead time is the estimated time it will take a supplier to deliver your order once they’ve received it. It’s a critical piece of information you must consider when calculating when and how much to order, as well as the minimum amount of inventory you want to keep in stock. At a bare minimum, when placing orders, you’ll need to order enough stock to get you through until the next order can deliver. As lead times are estimated and may change, you’ll want to carry some safety stock to ensure you avoid stockouts.
Average lead times should also be a deciding factor when selecting your vendors. In order to minimize the amount of inventory you need to hold (and, therefore, the cash you need to lay out), you’ll want to select vendors with the shortest lead times while also considering the price, service levels, and all your other supplier selection criteria.
Short supplier lead times are also highly critical if you find yourself running low on inventory and need to expedite an order. As lead times can change, and sometimes quite drastically due to supply chain issues, it’s important to keep your eye on them. We suggest you ask your service rep to help monitor the lead times on the supplies you regularly purchase and give you a warning if they expect or know of an upcoming change.
A key part of lean inventory management, Just-in-Time (JIT), is an inventory technique that focuses on minimizing waste and optimizing cash flow by bringing in supplies and materials shortly before they’re needed for production. By reducing the time between when you pay for supplies and when you use them, you can safely maintain low stock levels without risking a stockout. JIT is achieved using mechanisms like reorder point, safety stock, and order quantity.
A reorder point is a pre-determined level of inventory that triggers a stock replenishment. Reorder points are calculated based on supplier lead times, the quantity you expect to use within that time, safety stock requirements, and the shelf life of the product. Similarly, reorder quantity is pre-determined and is the quantity needed to be ordered once you hit or fall below the reorder point. Setting an order quantity removes the guessing game from purchasing supplies, ensuring you order what makes the most financial sense for your practice.
Reorder quantities are calculated based on average lead times, typical usage quantities, safety stock requirements, and shelf life. Additionally, suppliers may offer a price break for a specific order volume and require you to order in entire case or box quantities. Therefore, these factors should be considered when establishing your order quantities.
As you may have guessed, safety stock acts as a safety net, providing you some buffer in case of shipment delays or an unexpected increase in usage. Here’s where it’s essential to know your supply chain and your supplies. The more you understand the risks within your supply chain and, therefore, the likelihood of experiencing a disruption or delay, the better you’ll be able to determine how much you should hold “just in case. "Here are some important things to consider when determining the best safety stock level for dental supplies:
You’ll also need to consider your ability to react in case of an issue. How long would it take you to source and order from a secondary supplier if there were to be an emergency? Make sure to include the time it would take you to find a supplier with stock, set up an account if necessary, their typical lead times, etc. Consistency of usage and where the item is used also matter. If a product is low-cost but critical to a majority of your services, your risks are minimal, and it's safe for you to carry a higher amount of safety stock, knowing it won’t take you long to use it up.
You'll want to be more prudent on your safety stock quantities for high-value items that are used more infrequently or come with an expiry date. For more on how to calculate your safety stocks, including a formula, click here.
They say history is a great determiner of the future. This holds true when it comes to the supplies you’ll need to run your practice. Your ability to forecast demand will depend on how you’ve managed and tracked your purchases. The more history you have on your purchases, the more you can identify patterns and better estimate your supply and budget requirements. However, don’t forget to take into account the following:
One, if not the, most critical step in avoiding stockouts is to monitor your shortages and investigate the reasons behind them. Although you’ll want to avoid fingerpointing, understanding the root cause of a stockout will allow you to take corrective actions like changing suppliers, carrying a backup option if a product is experiencing supply chain delays, or correcting any gaps in your inventory management processes.
To err is to be human. It’s understandable that your busy office staff may miss placing an order, order the wrong quantity, or even, given the similarity of many products and the lengthy SKUs used to identify them, order the wrong item. Without the proper system and processes, you could even be overpaying on invoices. As understandable as errors may be, these are costly mistakes that erode your profits, hurt your office efficiencies, and risk your patient care. By providing you with the tools, visibility, and data you need to streamline and automate effective inventory management processes, Method’s inventory management software will help you avoid stockouts while saving money and time.
Leveraging Method’s inventory management platform, you will:
Avoiding stockouts is essential to safeguarding your profitability and your growth. But things shouldn’t end there. Improving your profits is hard work but vital to your long-term viability and ability to scale. Method's inventory management platform delivers everything you need for a streamlined, effective, yet scalable process that makes life easier for your employees so they can remain focused on taking care of patients— all while reducing overhead costs.Ready to find out more? Contact us now to arrange a personalized demo.
September 7, 2022
To remain viable, a practice must remain profitable. Developing a strategic procurement strategy is the first step in gaining the ability to control supply costs and thereby improve profits. To develop a strategy that aligns with your practice’s goals, a practitioner should understand how their suppliers operate and how the industry works as a whole. Supplier selection is a critical part of the procurement lifecycle. By understanding the differences between vendors, and the pros and cons of each, you can ensure to make the right decision for your business. Strategically deciding on the types of vendors you choose to buy from and establish long-term relationships with is an important part of ensuring you meet your objectives. To assist you in figuring out what kind of vendors are right for you, this article will focus on the key differences between dealers, distributors, and wholesale distributors and how those differences may impact your business. Let’s kick things off by taking a look at distributors.
Just as their name implies, distributors act as intermediaries, managing the distribution process for manufacturing companies. The distributor is typically delegated a specific geographical area by the manufacturer to sell certain product lines directly to dealers, who then resell the products to customers.As dental offices require a very wide range of often very user-specific products, ordering all supplies from a single manufacturer is simply not viable. Manufacturers prefer to sell in large quantities, while individual dental practices face space limitations and prefer not to tie up too much cash in unneeded supplies.By stocking tens of thousands of SKUs from a range of manufacturers, distributors step in as a middle man, allowing you to amalgamate your orders and order smaller quantities more frequently.Working as authorized representatives of the manufacturer, distributors will bring additional value to customers by:
A dealer acts as a middleman between the distributor and the final consumer, making their profit by adding a margin onto the price they pay the distributor. Again, they are authorized sellers for a given area, often referred to as being “official” or “certified” dealers. However, there may be other dealers in the same geographical area, so competition can be high, which often results in customer service and availability of products being a distinguishing factor and competitive advantage.Dealers also often sell a wide range of products and likely offer goods from competing brands.
Both dealers and distributors play middlemen in the distribution process between manufacturers and end users. They also both are authorized to use the manufacturer's trademarks and logos, as long as they aren’t represented as their own.Although the words “dealer” and “distributor” are often used interchangeably, they are, in fact, not synonymous. There are significant differences between the two, besides the fact that dealers deal with the final consumer and distributors have direct contact with manufacturers.Below we clarify for you exactly what those differences are.
A distributor purchases products directly from a manufacturing company and then distributes the product to dealers.Dealers purchase products from distributors and then resells the product to the end consumer, in this case, dental practices and DSOs.
Distributors are the middle man between manufacturers and dealers. Dealers link the consumer to distributors.
Dealers sell a particular category of products, whereas distributors sell a variety of products.
Distributors deal with a moderate level of competition while dealers exist in a high to extremely high competitive environment.
Distributors are responsible for distributing to a large geographical territory. Dealers sell to a smaller, more local area with more nearby competition.
To help motivate sales, manufacturers will often provide incentives such as special discounts to distributors. Distributors will also offer incentives to dealers, such as subsidized advertising.
Distributors stock non-competing products from one or more manufacturers. Dealers hold a large array of competitive product lines, often from a few different distributors.
Distributors purchase items in large quantities from manufacturers, whereas dealers can purchase smaller bulk quantities or even single units from a distributor.
A wholesaler buys goods in very large quantities from manufacturers and resells them to customers in smaller quantities but at wholesale price. Wholesalers typically sell to a limited area and do not have contracts with manufacturers. They also typically don’t get involved in or offer promotions or incentives.Wholesalers may buy and sell all types of products and attract customers by leveraging high-volume purchase orders to improve their purchasing price and passing at least a portion of their savings onto customers.
Choosing a vendor isn’t always black and white.Of course, everyone wants to save a dollar, and price should always be a main consideration when deciding on where and what you buy. But there are other areas that may introduce risk and impact your business, such as:
Almost all dental distributors hire sales representatives to oversee accounts and are compensated according to their sales numbers. Some go the traditional route of physically visiting offices to facilitate orders and offer sales support. However, other distributors prefer to utilize remote sales reps who rely on phone calls to drum up sales and get orders placed.As different practitioners want different things, both service models play an important role in supporting the dental industry. Because a field representative is constrained by geography and the time it takes to visit offices, they simply cannot serve as many practices as a phone rep. There are both cost and service implications to this for a practice to consider.In the end, you may choose to buy a certain segment of your supplies with a distributor whose “value-added” services you truly value and consider critical to your practice. For instance, a local rep may help you out of a bind by delivering some rush stock or offering samples of products you feel may bring a benefit to your practice.Other low-cost supplies that are regularly available through a long list of suppliers you may decide to purchase based on price alone, selecting the supplier at the time of order.Also, if you’re flush with cash and willing to order and store larger quantities, you could work directly with a wholesaler, for instance, and leverage your volumes for deeper discounts.Just remember, the pricing you see online may not be the best price you can get. Manufacturers, dealers, and distributors could be willing to cut you a deal based on your purchasing volumes. So go ahead, and make the ask. As the saying goes: you can’t get what you don’t ask for.
Method makes quoting your dental supplies with requests for quotes and proposals simple.Quickly send quote and proposal requests to multiple suppliers at once, choosing from a national list of dental suppliers, or send them to your known and trusted partners.Reduce email clutter and the time it takes to send multiple requests to vendors. Suppliers will then respond to your requests through our online portal. Once submissions have been received, Method will help you perform a cost analysis so you can easily see who is offering the best value.Then, select your items and suppliers, and Method will automatically convert the quotes into a purchase request. Upon approval, Method will also electronically send orders directly to suppliers. Or, if you’re accepting a proposal, Method will alert the winning bidder that they have won your business!Ready to save time and money? Get a Personalized Demo That Suits Your Dental Practice's Needs.
August 29, 2022
What's good for the goose isn't always good for the gander. Standard businesses that make money buying or producing products to sell have hundreds or thousands of inventory SKUs to manage. These companies require a lot of resources and robust processes, including a stringent inventory cycle count schedule to supplement their yearly or bi-yearly full physical counts.
When it comes to running a dental practice, however, things are quite different. Although dental practices are, in fact, still businesses and should be run as such, dental professionals and their teams are focused on providing optimum patient care. The employee(s) in charge of managing your supply inventory tend to take on the task on top of their regular duties.
Despite the differences, there is still plenty to be borrowed from the cycle, counting best practices and methodologies of other industries.
Below we'll walk you through what cycle counting is, what it entails, and how it can help you take control of your inventory so you can stay in control of your expenses and optimize profits.
Part of inventory management, cycle counting is an auditing process for physically verifying stock levels. To increase inventory accuracy, any discrepancies between the physical count and inventory accounting records should result in an adjustment. Unlike a full physical inventory count, where all inventory items are counted at once, cycle counts break up the workload into smaller bite-size pieces by selecting fewer items to count on a given day with the goal to eventually count all items over some time. The method allows dental organizations to increase inventory accuracy rates without taking too much time away from employees' essential tasks.
As resources are tight, you want to make pragmatic choices, ensuring your processes directly align with your goals, make sense for your business, and offer a clear return for your investment. Below we list the different criteria you can use for deciding the frequency and order of your cycle counts.
Most used Your most popular items that are pulled from stock daily. These are highly consumable, likely designed for one-time use such as PPE.
Criticality These items are critical to production. Perhaps they are required for the majority of the services you perform or are needed for emergency services that may happen at odd hours and with little notice.
Highest cost Pretty self-explanatory, you may prioritize items for cycle counting based on cost alone. However, counting these items regularly may help you pinpoint loss or theft. At the very least, counting your costly items regularly ensures you don't place redundant orders and unnecessarily fork out for expensive materials.
Physical location This is perhaps one of the most practical options, allowing you to make your way through your stock room right to left. However, you may be holding the same items in other locations. For instance, you may store paper cups in the stock room and hold a secondary stash closer to where they are used. Therefore, when choosing this method, you'll need to ensure all locations holding the same products are counted at once.
Improving your business processes with inventory management is a critical milestone in your journey to long-term viability and increasing profits.
To know what you need, you must first know what you have. This is where cycle counting comes in. You may be new to inventory management or perhaps have even yet to begin. However, no matter how good your purchasing, tracking, and management systems are, neither processes nor employees are immune to errors. As a result, inventory discrepancies are bound to happen.
Cycle counting is an important part of inventory management, increasing your inventory accuracy and allowing you to gain tighter control of your spending and lower your overhead to improve profits.
Verifying on-hand inventory allows you to recalibrate, providing you with the accurate information you need to inform your purchasing decisions. Ensuring you buy the right items, at the right time, in the right quantities, and at the best possible price safeguards your profitably, production rates, and patient service levels.
In the long term, maintaining accurate inventory levels will allow you to rely on intuitive order systems that warn you of low stock levels and let you know when it's time to order and reduce your safety stocks.Cycle counting has become a popular inventory management technique across industries as it breaks down the job of counting inventory into bite-size pieces.Further benefits include:
Unfortunately, there is no one size fits all answer to how you should plan your cycle counts. If you've implemented an inventory management system and are looking to increase your accuracy, when and what you count will vary greatly from a practice just beginning its inventory management and procurement journey.
But with a little thought, you can devise a plan suited to your business, allowing you to reap the benefits you most care about without unnecessarily draining resources.
In all likelihood, you're looking to cycle count to improve your procurement because that's where the biggest benefits lie. If that's the case, you'll want to align your counts with your procurement strategy.
If you currently have an inventory management system and are entering your receipt of goods into inventory and withdrawing inventory as it is consumed, then your counts will work as an audit process. This will allow you to increase accuracy and pinpoint any issues in your inventory management process (perhaps employees forget to scan inventory as they pull it from the stock room.)
In this case, you may want to start by counting at least your biggest movers once a month. If you find a few discrepancies, you can start counting less often, say once every three months and then once every six months, etc. Also, upon discovering a large discrepancy, one should always question if an order needs to be placed to ensure you avoid stockouts.
Now, if you're just at the beginning of your journey and aren't currently tracking your inventory, then we suggest you select your biggest movers to be counted biweekly and align the count with your purchasing process. So, count your biggest movers, say once every two weeks, and then immediately place orders for what you need. Then, the balance of your items could be counted and ordered once a month.
Of course, this is just a rough guide. The employees in charge of ordering supplies will likely know what makes the most sense for your practice. By including them in the project early on or even letting them drive it, you're more likely to get their buy-in and have more success in implementing your new process.
If you're using an inventory platform like Method, you can quickly enter your counts into the platform by scanning the barcode. And if you're ready to take advantage of the intuitive order system, you can establish your reorder points, and the system will automatically alert you of what needs to be ordered.
In both cases, keep in mind your high-cost items. These may not need to be counted or ordered as frequently as other items, but they can be extremely costly. Therefore, you'll want to ensure they are under control and avoid unnecessary ordering.
Here are a few key reminders to keep in mind as you're planning out your cycle counts:
The cycle counting process sounds simple. You create the list of items to be counted, count your inventory and then update your systems or spreadsheets with the correct count.But when your supplies come in boxes and/or cases that are opened and distributed throughout your dental office, suddenly, counting inventory becomes cumbersome and time-consuming.
Rather than avoiding counting altogether, we believe you have more to gain by taking a pragmatic approach. Sometimes good enough is good enough. For example, if you're counting inventory for the express purpose of making good procurement choices, you don't need to strive for 100% inventory accuracy, and there's no point in wasting your employee's time trying to get there.
Instead, estimate your counts and create a spreadsheet that does the math for you.
Here's what we mean:
For example, if you're counting N95 masks that come in a box of 35 and you have approximately 4 and a ½ boxes in stock, you would enter 4.5 into your spreadsheet, which would calculate your total onhand inventory to be 157.5. Now, the count won't be exact. But remember, good enough is good enough.When deciding whether this approach is suitable for a given supply, keep in mind the cost of the item, your usage quantity, and if it has a shelf life. High-cost items or products that may expire should be counted and managed more stringently. However, with your low-cost, high turnover items (like said masks), a small discrepancy in your count won't impact your final purchasing decision or introduce any risk. Now, let's walk you through all of the steps.
Step 1: Create your inventory cycle count schedule (what items will you count and when).
Step 2: Create a templated spreadsheet listing the supplies to be counted, including the SKU or manufacturer part#, for easy identification. Include the quantity per box and create a formula to calculate your total on hand.
Step 3: Print off the spreadsheet and use it to manually tally up your counts.
Step 4: Enter your counts into your spreadsheet.
Step 5: If you're tracking your inventory using an inventory management system, update your system with the final inventory count for each item.
Step 6: Review your reorder points and reorder supplies as needed.
Here are a few other best practices that will help you mitigate your risks, continue on your road of improvements, and more effectively implement cycle counting.
Assign Cycle Count Teams
Many hands make light work. You're also more likely to get more accurate counts if they aren't always performed by the same person.
Segregate Duties
Segregation of Duties (SOD) is a financial control measure designed to mitigate the risks of fraud and theft by distributing responsibilities. For example, you should avoid having one employee responsible for purchasing and receiving.If that isn't possible, however, splitting purchasing responsibilities by category, for instance, between various employees, ensures no single person has excessive control over buying activities.
Standard practice is to separate responsibility for:
Suppose you have a current inventory management system tracking your inventory and find large discrepancies between your physical count and your system count, soon after noticing a large inventory discrepancy. In that case, you'll want to perform a root cause analysis to see where your issues lay.If you've implemented inventory procedures, including receiving inventory upon deliveries and withdrawing inventory as it is used, there are two potential causes:
Either way now would be a good time to re-iterate and review your new processes with employees and ask if there are any issues preventing the process from being carried out.
If you haven't already, now may be a great time to consider a digital inventory management system with intuitive ordering and barcoding capabilities to help you implement efficient inventory procedures and controls.
Solid inventory management is essential to a productive, healthy dental practice. A standard, digitized process for tracking and managing your supplies can help you do more with less, improving efficiencies and profits.
Reducing the costs associated with inventory begins with accurate tracking of inbound shipments. A single misrouted or delayed order can have a ripple effect across the practice, impacting production and patient care. Therefore, it's critical that all team members have access to real-time information on inventory levels, open orders, and shipment status.
Additionally, all supplies should be inspected, counted, and recorded upon arrival. This doesn't need to be time-consuming, but it does need to be done consistently and accurately.
Spend management platforms that maintain detailed records and leverage barcoding make this efficient for your team and provide an audit trail of exactly what happened and when, so you can pinpoint issues and confirm invoices to ensure you pay no more than you should for your supplies.
A smart inventory process also includes a disciplined approach to recording consumption or withdrawal of on-hand items. But, here's where the right platform with barcoding capabilities that alerts you when items fall below a defined level can help.
Contact us today to schedule a demo and see how our software can help you effectively control your dental inventory management processes!
August 22, 2022
Sound inventory management techniques are the foundation for strategic procurement, enabling you to:
Choosing the right inventory management processes that suit your dental practice is not a simple task, and the more your business grows, the more difficult managing your inventory can be. That's why laying the right foundation with a scalable solution is critical for growth. Luckily, Method is here to help. Below we outline what inventory management entails, its benefits, and the techniques and best practices that make for good inventory management. We'll also dig into how digitization can enable efficiency and make life easier for employees, so they can get on with taking care of patients.
Inventory management is the tracking and managing of inventory from the purchase of goods through to their sale or usage. Tracking inventory allows you to identify when it's time to order and how much to order, ensuring you always have enough stock of the right supplies to service your patients. Learning to manage your inventory is the first step in gaining control of your spending so you can stay within budget, minimize waste and leverage your purchasing volumes to reduce costs and improve profits.
Although your supply inventory is needed to produce revenue, it also ties up cash. Too much inventory impedes your cash flow and puts you at risk of financial hits from expired, lost, or damaged stock. This is why inventory turnover (how long your inventory sits before it is used) is a good measurement of your inventory management. Inventory management is a key component of an organization's financial health, as it ensures you carry the appropriate amount of stock to suit your business needs. Carrying too much stock ties up cash and puts you at risk of loss, damaged or expired inventory. But too little inventory can lead to stockouts, damaging your patient care and revenue. Proper inventory management can also help save you money. By understanding your usage, you can leverage your purchasing volumes for cost savings and take advantage of economies of scale. Inventory management can save you on soft costs (indirect costs such as labor) and make life easier for your employees. By removing the guesswork from buying supplies, streamlining processes, and organizing supplies, employees can more easily reorder supplies and quickly find what they need when they need it. Your dental office is a busy place. But, by taking some moments to review and establish some essential inventory management processes, you can remove some of the chaos while improving profits. It's a win-win for employees and your balance sheet, providing you with a systematic, scalable approach to managing inventory that optimizes profits and supports future growth.
For dental practices, the goal of inventory management is to know your stock levels, where that stock is located, and identify when it is time to order more and in what quantities. At its most basic level, the process works by tracking your current stock levels and then adjusting inventory down, as it is used, and up, upon receipt of deliveries. As no system is perfectly executed, inventory counts will lose accuracy over time. Therefore, physical inventory counts are performed to audit, validate and adjust inventory levels as needed to increase accuracy. The process begins when you identify the requirement for a specific supply. The item is then sourced, a vendor selected, and an order placed and tracked. Upon delivery and verification of the received item, quantity, and condition (the product must be in good order and fit for use), the quantity received is then adjusted into inventory. The inventory management process also involves organizing storage and analyzing future requirements by taking into consideration factors that may impact usages such as growth, scheduled services, or holidays to ensure inventory levels suffice and are used as efficiently as possible.
Below we've listed nine good-to-know inventory management terms and techniques most relevant to the dental industry. These are the methods and processes that help you to balance your priorities, keeping your practice safe from disruption while taking into consideration the availability of resources and profits.The point is not to implement all these processes at once, but to choose what is most imperative for your practice and make small but ongoing improvements over time — because small changes lead to big impacts.
Based on the famous Pareto principle, the ABC analysis is a way of identifying and categorizing inventory by popularity, with A being your highest movers and C being the least. The Pareto principle, also known as the 80/20 rule, was founded on the idea that 80% of outcomes come from 20% of causes. If the principle is correct, 20% of your stock generates 80% of your profits.The idea isn't that you completely forget about the other 80%, but rather that you focus the majority of your efforts on ensuring the 20% meets its full potential by:
First in, first out (FIFO) is a systematic process for ensuring your oldest stock is used first. This process is essential for supplies with a short shelf life, ensuring you minimize waste from expired products. It's rather simple to set up. Think of cans on a grocery store shelf. The key is to line up supplies, one behind the other from oldest to newest.
Cycle counting is an auditing process where you physically verify and adjust stock levels to correspond with reality for increased inventory accuracy. Rather than performing a full count of all inventory at once, which can be extremely time-consuming, the counting method breaks up the counts into more manageable pieces.
Over the years, giants such as Toyota and Motorola have given birth to methodologies that help guide organizational improvements. Although initially born out of necessity for manufacturing efficiencies, the Japanese methodologies have proven universally effective in reducing waste of any kind (including time) and increasing efficiencies. The methodologies have since been adopted for businesses of all types and sizes, including Amazon, which uses six sigma to improve customer satisfaction. One of its core principles is lean inventory management, a staple practice for those looking to control costs and maximize profits.
A central part of lean inventory management, JIT focuses on reducing waste and optimizing cash flow by bringing in materials just in time. Minimizing the time between delivery and use allows companies to safely maintain the lowest stock possible without risking production rates or service levels.
An important part of inventory management is knowing when to reorder. Based on a formula, reorder point is the minimum stock level that triggers a reorder, ensuring you carry enough on hand to get you through until your order delivers without risking running out.
Economic order quantity is a pre-calculated order quantity that reduces holding costs while also taking into consideration purchasing price, ensuring you order a quantity that makes the most economic sense for your business. Your order quantity impacts your purchase price, cash flow, and carrying costs (the total costs of buying, storing, and managing inventory, said to run between 20 and 30% of the total cost of inventory). Therefore, it's important to get it right and not make such an important call on a whim. Your order quantity should be carefully calculated with consideration given to your expected usage, the average lead time for the product (the time between placing an order and when it delivers), shelf life, your practice's financial situation, and any physical holding limitations.
Safety stock is extra stock you carry with the explicit intention to act as a buffer, helping you to mitigate the risks of stockouts in case of any uncertainties such as inventory discrepancies or disruptions in supply. There are different methods for determining your safety stocks, depending on your priorities and how much risk you're willing to take. Depending on your inventory management system, your safety stock may be calculated into your reorder point.
MRO stands for maintenance, repair, and operating. These items are required to run your practice but do not directly support the production process. As they aren't required to service your patients, the items typically aren't tracked and follow a different ordering process than your inventory items. They may even be managed by different employees. MRO items include office or janitorial supplies, technology, or other tools and components required for maintenance, repairs, and operating.
When deciding how to improve your inventory management, you must look at your business priorities and the resources you can allocate. Here's some food for thought. To improve profits, you have two options. You can either look to increase revenue by buying more practices or adding more chairs, or decrease your overhead costs. When it comes to increasing revenue, tactics that drive revenue growth, such as marketing, are high risk. There's no saying you can get more patients into your door simply because you've poured money into marketing and scaling. Additionally, only a portion of your revenue makes it to your bottom line, as you must first subtract your overhead. We've estimated that saving one dollar is equivalent to generating $2.94 in production revenue. Now, you can, of course, always do both. However, by prioritizing improving your inventory management and establishing a scaleable process, you can ensure to scale your practice more profitably.If you're ready to start prioritizing your inventory management, here are a few first steps. Start nurturing your supplier relationships
You may feel some loyalty to long-standing suppliers, and that's okay. But even long-standing suppliers should be willing to work hard to maintain your business. Let them know you're paying attention to your costs and are looking to start leveraging your volumes for price reductions. Collect and utilize your data: Data is power, giving you the information you need to reduce your supply costs and better manage your inventory by setting reorder points and order quantities that make the most economic sense for your business. Establish a formulary: To take advantage of economies of scale and reduce costs, you'll need to limit the number of SKUs you purchase and gain control of your purchasing habits. Establishing a formulary that your employees must abide by when purchasing supplies is the first step in that direction. Set a supply budget: If you haven't already, create a supply budget and stick to it. Your supply budget should be a part of your overall dental practice budget. If you don't already have one and aren't sure where to start, we’ve got you covered in How to Create a Dental Practice Budget. Implement an approval process: To control spending and help you stay within your budget, implement an order approval process where those in charge of your financial outcomes approve orders before they are place. This is one area where digitization is key. This leads us to…Consider digitizing: Without technology, inventory management can be extremely time-consuming, limiting your ability to buy smarter and significantly reducing your supply costs. Given the impact that improved inventory management can have on your practice and profits, it may be time to digitize your processes. Let us show you the difference digitizing with Method can make.
Effectively managing the long list of SKUs you require to run your dental practice may sound simple, but it is far from an easy task. Knowing what, when, and how much to order for every item can quickly become complicated. Yet, dental practices simply can't afford to overbuy and overpay. As a result, many growing dental practices graduate to an inventory management platform with capabilities that go far beyond spreadsheets and formulas. Developed by people in the industry for the industry, Method is flexible enough that you can start wherever it is you are and robust enough to scale with you as your business grows and matures.
The principles of lean inventory help to create efficiencies, helping you do more with less — an imperative during a human resource crunch. By lowering the cost of doing business, you increase your profitability. And by calming the chaos that can come from the management of supplies and creating a standard process, you reduce the pressures on employees and allow them to bring you increased value by doing the things they do best. By implementing streamlined digital lean inventory management techniques, you free up your cash and your people so they can do more impactful things for your dental practice. Ready to improve profits and better manage your inventory? Method Procurement gives dental practices and DSOs the necessary inventory management capabilities to succeed. Our full end-to-end inventory management system makes ordering dental supplies straightforward and hassle-free. Ready to learn more and see how our dental procurement software can help you achieve a lean inventory without increasing the burden on your employees? Contact Method today.
August 1, 2022
Truth be told, for many dental professionals and even DSOs, inventory management continues to fly under the radar, with little to no thought given to how and when dental supplies are purchased and handled. Without a standard process, employees are left to manage a very long, complicated, technical list of supplies through disparate systems and processes, reliant on emails, faxes, phone calls, and supplier portals.
However, as practices battle a labor shortage and fight to improve profits, how you manage your inventory presents an enormous opportunity to lower your overhead, thereby increasing profits. Doing so digitally allows you to save on costs while reducing the time investment, increasing your office efficiencies, and allowing your employees to focus on the job they were trained and hired to do, service your patients.
Below we fill you in on what inventory management is comprised of, offer tips for smart dental supply order management, and take a look at what you have to gain from it all.
Interested in improving your profitability? Want to know about how Method's dental inventory management system can enable your employees to make smarter buying decisions? Keep reading to find out more.
Dental supplies can be costly, from N95 masks to nitrile gloves and implants. Although ideally, a dental practice should spend 4% to 6% of its overhead on supplies, according to an Aldrich report, in reality, the average single dental practice spends 7.2% of collections on supplies, showing there's plenty of room for improvement.
Supply costs represent a major area of expense for a practice. Therefore, having a good handle on how you purchase your supplies is critical to optimizing profits, impacting your production rates and service levels.
Inventory management involves tracking the supplies you spend money on from purchase to usage and identifying requirements, ensuring you buy the right item, in the right quantity, at the right time (and hopefully, if you're focused on procurement, at the best possible price).
Proper inventory management techniques safeguard your practice against stockouts that could impede your service levels while optimizing your cash flow, decreasing carrying costs, and reducing the likelihood of incurring damaged, lost, or expired stock.
Dealing with limited storage space? Are your supplies cluttered, unorganized, and hard to find?
Managing your supply inventory isn't an easy task. However, by implementing a standard process, you can ensure all employees perform the task in the same, optimal manner that aligns with your business goals.
Here are a few tips To help you avoid running out of critical supplies:
Although you may want to start with your highest movers, you eventually want to create a list that encompasses all the supplies you use over the entire year. This may seem overwhelming or tedious, but an accurate supply list is the foundation of good inventory management.
Next, you'll want to record your purchasing information, including the suppliers you purchased from, how much you purchased, when, and at what price.
Again, this may seem horrendously tedious—which is why digitization may be the key to success. Historical purchasing data empowers you to leverage your volumes for improved cost savings, track price increases to avoid "price creep," and identify anomalies so you can highlight improvement opportunities and ensure you buy smarter moving forward.
You'll want to perform routine inventory checks, preferably once every couple of weeks, or at minimum once a month. First, record the stock level of each item on your supply list and compare it to your last count. This will give you an idea of your usage. Pro tip: if you're using an excel spreadsheet, formulate it to calculate your usage and save your history so you can use this to more accurately forecast future demand.
You'll also want to pay attention to special circumstances that may temporarily impact your usage. For example, perhaps you're aware that you had a highly irregular amount of hygiene appointments and used more than the average amount of prophy paste. You don't want to continue to repurchase at these increased volumes if the higher usage isn't expected to last. Inversely, look ahead and consider if there is anything out of the norm you should account for when you're ready to purchase supplies.
Periodically look back to your on-hand counts and how slowly or quickly inventory is moving. If inventory sits too long, you're tying up cash flow and risk the financial hit of wasted materials if they expire. To prevent this, you'll want to lower your order quantity.
Assuming you've created a budget for your practice(s), you need to ensure you stay within it. Overbuying can lead to cash flow issues, leaving you short to pay necessary expenses. If you do find you have to buy more than you budgeted for, look into the root causes.Perhaps you underestimated your budget due to unforeseen price increases, or if you're lucky, business is busier than you expected. However, in many cases, you'll likely find you're over-purchasing.
If your purchasing processes are overly cumbersome and you're running into labor issues, your employees may be looking to save time and err on the side of caution by buying large amounts. Although you can't blame them, there are better ways to save time and mitigate risks without pinching your finances (we'll get to those later).
By implementing an approval process, you can catch problems before they occur and ensure you stay within budget.
Creating a written standardized ordering process that aligns with your procurement and inventory strategy will ensure its successful execution, keep you on track to meet your goals, and alleviate stress for employees.
By creating a step-by-step guide on ordering supplies, you eliminate the guessing games for your employees who otherwise are left to piece together the semblance of a process that is likely to leave things falling through the cracks. Importantly, a written process also helps during times of high turnover. It gives new employees a reference guide as they "learn the ropes" and ensures your inventory continues to flow as needed.
Make sure to include as much specific information as possible, including any approved private label options, preferred suppliers, budget allowances, contact information, and any necessary delivery requirements such as delivery times or contacts.
Managing inventory is a balancing act. To control administrative costs and limit the hassles put on employees, you'll want to minimize the number of orders you place. Remember, every order requires entry, approval, sending to the supplier, tracking, receiving, and finally, paying the invoice. The costs of all these steps add up fast.Ordering in smaller amounts also means you're likely missing out on the cost savings that come with economies of scale. However, over-ordering increases your carrying costs (Inventory carrying costs are the total costs related to buying, storing, and managing inventory), impedes your cash flow, and puts you at risk of financial write-offs.Hence, why it's important to find your sweet spot and order not too much and not too little.
Method's scalable inventory management solution was tailor-made for the industry by people in the industry to be flexible enough to start where you are and robust enough to grow with you as your practice matures and scales.
Leveraging technology such as barcode scanning Method makes accurate inventory management easy for you and your team.
People who understand well the realities of a dental office manage a stock list, reorder supplies, and update on-hand quantities from a single dashboard, so you can ensure to order the right materials at the right time, safeguarding your productivity and patient care while saving you money.
Here's how Method can help enable easy but effective inventory management:
Barcode scanning: Minimize errors and increase inventory accuracy by shopping, receiving, and re-calibrating stock levels using barcode scanning.
Create and manage stock lists: Digitally maintain supply lists for the items you are looking to track and control. Whether it be an official formulary or simply a list of trusted products, you can create individual lists for different locations and/ or by category.
An up-to-date stock list is key for running a productive dental practice. Forgo endless supplier research and search our industry catalog with full product details and images on more than 800,000 unique dental and medical products to quickly set upp your stock list.With access to the industry's best products and resources, you can ensure you choose the right products for your practice.
Low stock alerts: A stock out on a critical item could lead to a loss of patient revenue. While as we've explained, holding too much inventory causes waste, takes up space, and ties up cash unnecessarily. Knowing what you have and when it's time to reorder is key to striking the perfect balance.Luckily, Method has your back. Once you've established and entered your reorder points (the level of stock that triggers an order to be placed), hover text warns you with a yellow symbol once you're halfway to your reorder point, and red once you hit your reorder point.Once you see an alert, you can handle your ordering process right from the platform by simply clicking "add to cart."
Complete visibility: To help you avoid redundant orders and stay on top of expected deliveries, Method offers real-time information on open order requests and pending receipts for each item in "the dental practice's" inventory list.
Of course, that's not all. Method's electronic approval process with auto alerts ensure's orders don't get hung up waiting for approvals and lets you quickly track orders against budget. Buying rules allow you to control spending and ensure adherence to buying policies. And our analytics deliver the data you need for strategic decision-making and negotiating the prices you deserve.
And that's just the beginning. Click here to learn more about how Method can help you compare, purchase, track and manage all your dental supplies.
Ready to optimize your stock levels and keep the right amount of bibs, floss, and gauze on hand while minimizing waste and saving on the cost of supplies?
Call and arrange a personalized demo to find out more.
July 25, 2022
Some smaller businesses consider the Purchase Order (PO) to be an unnecessary step in the purchasing process, complicating a simpler process, and something better left for larger organizations with more time and resources. After all, you can simply jump onto a supplier's portal and buy what you need with a few clicks of the button—no purchase order necessary. The supplier, of course, will ship, document, and invoice everything correctly, and you will simply pay the correct price upon receiving the invoice—no checks or balances required. However, what may seem like a shortcut, can end up costing you time and money. To help you improve efficiencies and safeguard your profits, this article will help you:
Now, how about we start at the beginning?
A purchase order is a contract issued by a buyer that documents their intent to purchase products and/or services. Upon receiving the purchase order, the seller can accept, reject or modify the order (usually through the issuance of an order acknowledgment.) The PO becomes a legally binding contract upon acceptance by the supplier or vendor. Purchase orders are at the core of a solid purchase-to-payment process, streamlining the process of procuring goods and services and ensuring accuracy and efficiency. Although they may take a little time to complete (much less if you're leveraging a digital spend management solution), they allow for clear and explicit communication of critical information, thereby minimizing opportunities for errors that can lead to stock-outs and overspending and put your practice and profits at risk. Among other benefits, this legally binding document can help you gain control of your spending and should be a necessary part of your purchasing process.
Although they may vary and are often customized to business requirements, generally speaking, here is what a purchase order may contain:
Depending on your procurement purchasing workflows and standard practices, these items can be optional or a strict requirement. Utilizing a spend management platform such as Method, you can add location and category codes that allow you to control and analyze spending habits and identify opportunities for improvement.
At first glance, a purchase order can look very similar to an invoice as it can contain many of the same details. However, purchase orders and invoices differ greatly in their purpose and hold one very critical difference. Buyers create POs to document their intent to buy. Vendors create invoices to charge clients for goods or services rendered. The major difference is that POs communicate intent and are meant to spur action, while invoices reflect what occurred and is being charged. As an invoice requests payment, it should include all relevant information as to what is being charged for, as well as information needed to ensure proper payment processing. This includes an itemized breakdown of all items or services, quantities, prices, and units of measure, and currency, as well as referencing corresponding documents such as POs and packing or delivery slips and, critically, payment due dates. Of course, like all standard business documents, invoices must contain their unique identifier, an invoice number. With all the necessary information present, the buyer can perform a 3-way match, cross-referencing the purchase order with the packing or delivery slip to validate all information prior to issuing payment.
A digital purchase request and subsequent order approval process allow you to stop purchases that throw you over budget or simply don't make sense for your business before they occur. A purchase request is the first step in the order approval process. A control mechanism that helps to reduce errors and gain better financial control, an order request and approval process prevents overbuying and ensures purchases remain in line with your budget. Although similar to a purchase order in the information that it contains, a purchase request is an internal document whose sole purpose is to obtain approval from finance (or other pre-chosen appropriate personnel) prior to placing orders with suppliers.
Creating purchase orders does add a step, but the benefits far outweigh this additional effort, even more so if you leverage technology to help ease the burden. POs are an important part of the procurement process, helping dental practices to:
Additionally, using electronic POs (and purchase requests) comes with its own set of benefits. Paper-based purchase orders are more time-consuming, create more work for your employees and open you up to a range of potential errors. Using digital POs through a spend management platform removes these barriers and streamlines your purchasing, providing greater transparency through every stage of the dental procurement lifecycle as well as delivering a host of other benefits, which we've listed below.
Centralizing your purchase orders - Whether you manage a single location practice or a DSO, a cloud-based procurement environment can help you manage and organize POs in a centralized. This allows finance and front office staff full visibility on the status of orders, showing what has been requested to be ordered, what's approved, on order, and delivered. And because procurement platforms live on the cloud, you can rest assured that your POs are securely stored and easily accessible at any time, anywhere.
Avoid overspending and fraud - With full transparency, your entire team stays in the loop and ensures no requests are lost or forgotten. By simplifying collaboration across your team, the process also reduces unnecessary, incorrect, or duplicate orders, saving you money. Furthermore, implementing a proper receiving process and three-way match process makes it easier for accounts payable to spot fraudulent or inaccurate invoices before they are paid.
Lessen errors and maintain accurate procurement records (pssst… you can then use this data to leverage your volumes for cost savings) - We've already shown you the long list of information required for a purchase order. Now consider the very long list of dental supplies required for running your practice and the frequency in which they are purchased. That's a lot of information to maintain and enter accurately onto manual purchase orders. Procurement platforms are designed to reduce human error and streamline workflows. They also bring the added benefit of aggregating your procurement data into usable, digestible formats that allow for more strategic procurement and identification of potential areas of improvement. Once you know what you buy, how often, from who, and what price, you can use that information to negotiate better pricing with the supplier of your choice, and tighter control on your spending ensures you take advantage of that price and realize cost savings for improved profits.
Sustainability - Of course, let's not forget that a paperless purchase order system is better for the planet, lessening the carbon footprint of your dental organization.
A dental office is a busy place. However, staff purchasing your supplies are often the same employees responsible for taking care of patients and managing other administrative tasks. By leveraging the right technology, such as Method's spend management platform, you can simplify your purchase order process and safeguard your dollars and profits while making life easier for your employees. See who your preferred suppliers are, who has the lowest price on the market, and who has stock so you can make a sound purchasing decision. And that's just the beginning. Keep reading to find out more about how Method can enable accurate, efficient order placement.
The prices of supplies can vary greatly between suppliers. Without platforms like Method's, your staff is left to hunt for pricing and availability on their own, jumping from supplier portal to portal and relying on emails and phone calls to gather all the information they need. The process is extremely time-consuming, which is why many simply buy from the quickest and easiest source. But this leaves a lot of money on the table, money that should be going straight to your bottom line. Instead, Method allows you to quickly and easily see real-time pricing and availability across our detailed industry catalog of over 700,000 dental supplies and 2,000+ dental-specific suppliers. By bringing the market to their fingertips, employees can do their due diligence and comparative shop, ensuring they make the best purchasing decision for your practice.
If you're purchasing processes are further along, and you've implemented some buying rules you expect employees to adhere to, we can help you there, too. Method's Buying Profiles help you control rogue spend (spending outside of company policy) and ensure even new trainees can buy what they need within company policy. You can choose to give employees a choice and simply highlight preferred suppliers (identified by a star) or enter an "allow list" of preferred suppliers and limit your employee's view to preferred suppliers only. Have more than one practice? That's ok—we're built to handle that. Rules can be created either by location or for all locations.
Order the right item, in the right quantity, from the right supplier at the right price. The dental supply industry has a very long list of supplies that are often hard to distinguish from one another. By relying on technology to input text fields, you eliminate the chance of human error. For example, SKUs are long, hard to read, and often only differ by a character or two. By scanning a barcode rather than relying on manual entry and selection, you eliminate the chance for error, ensuring you buy the exact right item. As another example, the order quantity field ensures orders are placed in round order quantities. Say there are 6 of an item per box, you don't want to be ordering 9. Ordering the right quantity in the first place saves you from having to correct and resend orders to suppliers. To ensures the purchase order contains the best price that is available to you, Method also pulls and displays private pricing from API logins, contracts, and RFQs.Lack of visibility on open orders can lead to redundant orders, tying up cash flow and putting you at risk of expired or damaged stock. Luckily, to help you avoid duplicating orders, Method displays pending order requests and open, unreceived purchase orders.
To save time, you can enter an order request for multiple suppliers. Once approved, Method will automatically create and send individual purchase orders according to your supplier selection. When an order request is entered into Method, team members responsible for approvals are immediately notified through in-app notifications and email. Insights into purchase details and where you stand against budget help guide financial decision-making. A fully flexible approval process allows you to approve some items on a request while declining others. You can also provide reason codes upon declining to allow for future analysis. Soon you'll even be able to review and take action on purchase requests via email from any mobile device! Method empowers your office to make purchases with speed, control, and accuracy. For many dental offices, the buying process continues to be managed manually, reliant on emails, phone calls, supplier portals, and, yes, even fax machines. However, when leveraging technology, the process is streamlined, efficient, and effective, empowering your employees to make the most advantageous buying decisions for your practice. Buying smart and implementing best practices throughout the procurement lifecycle allows you to:
Want to learn more about Method's capabilities and our simple, flexible pricing plans? Click here. Ready to improve your spend management for improved profits? Request or demo or contact us for more information.
July 18, 2022
We’ve all been there; you get to the grocery store only to realize you’ve forgotten the ever-critical shopping list. When you get home, you notice (or worse yet, your spouse notices!) you forgot a few important items and over-bought on others. Frustrated, you head back to the store for the forgotten items, spending more gas and time than you had originally planned.Whatever your procurement goal may be, although it may seem a small, perhaps even inconsequential step, creating an inventory list should be at the top of your list.Just as a grocery list ensures you buy the right items in the right quantities creating an inventory list will help you better manage your dental office supplies and streamline the stock-taking and buying process.
Whether you’re a single practice or a DSO, establishing a standard inventory list for your dental supplies is the first step in improved spend management, allowing you to implement formularies and buying rules that lead to deeper cost savings and optimized efficiencies.While helping you to do more with less, an inventory list can also help safeguard your profits by:
Before getting started, it’s important to have the basics in place first, as well as understand the pros and cons of relying on a spreadsheet to manage your inventory so you can ensure it’s the best way to go for your practice.Below we offer you some guidance, including how you can organize your supply closet to eliminate any unnecessary items, create a dental supply inventory template to standardize the process, and analyze the list to establish the must-have items and their appropriate buy quantities.
If you’ve not yet organized your dental practice, check out ‘5 Great Dental Office Organization Ideas’, where we tell you exactly how to remove any unnecessary items from your dental office space. This will help you in removing redundancies and allow you to create an initial dental office supply list as the starting point for managing your inventory.When you’ve finished admiring your hard work tidying up your dental or office supplies, it’s time to create a dental supply inventory template.Using a spreadsheet all team members can access (although perhaps not edit) is a great way to ensuring you have one version of the “truth.” Maintaining a list that looks the same to each member where they can quickly make note of all necessary items, categories and buy requirements allows for easier, clear communication that reduces opportunities for errors.To get the most out of this process and help save time, do your due diligence and give some thought to how you could organize your dental office supply list. For instance, you may want to break your supply list down by categories, separating hygiene from PPE and office supplies for example.You can also design your dental office inventory template in such a way that it resembles a document. You can ease use for your employees by highlighting all relevant cells and hiding any irrelevant cells.While creating your template, ensure that you’ve covered all the bases, including giving consideration to the physical aspects of how your employees will be performing physical inventory checks. Make the task easier for your staff by adding useful information such as the location of items, manufacturer part numbers and quantities per unit.Also, although you want to try and avoid creating a spreadsheet that’s too large or overcrowded, creating bold coloured headers that help direct the user’s eye to the right place.
If you have employees, you know that you can’t achieve everything yourself. As the owner or leader of a dental practice, you won’t be able to juggle all of the tasks that need to be done in order to maintain success across the business.Delegating tasks essential to the daily running of your practice allows you to prioritize other business tasks like strategic planning and scaling while you mitigate potential overspending.There are a few additional benefits to assigning someone to oversee inventory and take care of stock checks:
Giving one person the responsibility of maintaining the inventory spreadsheet template with clear instructions on how often they are expected to carry out regular reviews to ensure you remain on top of your stock and know when it’s time to reorder. The responsibility could be incorporated into a particular job title within the dental practice while also providing one of your team members with a sense of ownership and ability to increase business productivity.As the owner of the task, that person may later decide to delegate to someone else as part of their day-to-day work while ensuring the correct information is recorded every time. To ensure processes are followed adequately, its best to officially document the process so you can provide employees with a reference in case of questions.
Like any template within an organization, your inventory list spreadsheet may become outdated very quickly as you introduce new products into your practice and discontinue the use of others. This is another reason to assign the task of managing the file to a member of the dental office team, as there is continuous work involved in maintaining an up-to-date spreadsheet.Perhaps you may find an alternative consumable product that will replace another piece of equipment, or maybe it’s a case of analyzing the spreadsheet regularly to determine if it is fulfilling its function. While routine checks are important, it also pays to record the versions of your list or, if you don’t want multiple documents cluttering your filing system, date the spreadsheet every time it is updated.
The main reason you will create, or have completed, your dental office inventory list is that you want to find out where stock can be managed more effectively, particularly the consumables that are depleting daily.Keeping a record of past completed inventory checks will provide valuable data that you can use to optimize your dental practice. But how could you possibly use the data?
Too often, businesses will gather data and display it in readable formats, but you need to use that data in order to gain the most from the task. Ultimately, you must commit to the full process in order to achieve the optimum return on investment for your inventory list, as a completed list without analysis doesn’t provide much insight to improve stock turnover, efficiency, and reliability.
We can’t lie—although creating a spreadsheet to help manage your inventory may be a good first step for a practice with little to no control over their supply buying processes, it can be problematic.Manual inputs are highly prone to human error, creating costly inaccuracies that can lead to stock outs that hinder your production and service levels. It’s also labour intensive, something few dental offices can afford.By leveraging a spend management platform specifically designed for the dental industry you can create a scalable process that ensures maximum value extraction through a robust and streamlined procurement process designed to optimize outcomes, increase efficiencies and improve profits.
We’ve covered many areas that inventory can provide organization. Performing a detailed analysis of your stock and past spend practices will help you gain a greater understanding of how effective your procurement process is and where there may be opportunity for improvement.The ability to digitize documents and empower more insights-drivenl decision making with data analytics will not only open up new, more efficient opportunities for your dental operatory but will also minimize the time spent on the process. However, your return on investment will be much greater if you decide to adopt procurement software to carry out these functions.As you can see by using our ROI calculator, leveraging the Method Procurement platform your dental practice will begin to see a much simpler, smarter way of taking and restocking inventory while carrying out the necessary processes to ensure that data is interpreted quickly and effectively.As you can see by using our ROI calculator, leveraging the Method Procurement platform your dental practice will begin to see a much simpler, smarter way of actively managing your purchases, so you can reduce your overhead for greater financial returns.The ROI calculator is a useful online tool that allows you to input your annual production value to determine the best possible spend management strategy and the bottom line without putting in extra time in the evenings or on the weekends to compile and develop a strategy for your data.Method’s procurement software is designed by dentists as a solution for the industry to enable digitization of processes and continued growth and development of your dental supply list, which is capable of responding to your business growth. Users will experience a platform that is easy to customize and navigate on a daily basis with further embedded functions, such as Requests for Quotations (RFQs), order requests, Purchase Orders (POs) and barcoded inventory management.An easy to access dashboard empowers more strategic long-term planning so you can better leverage volumes and enable continued improvement with the necessary data immediately to your dental office staff.
More businesses require efficiency and the ability to carry out menial processes much quicker and alleviate the extra work for staff to create a more functional inventory system. Creating and dental supply list and collating information is a great way to kickstart your stock management, but is very much the old way of working.With outdated systems or even manual processes, continuity is likely to plummet—especially when it involves a new process. Method’s dental procurement solution collates all information for all relevant employees into one convenient place in real-time, allowing for a continuous process with minimal manual input from your staff.Work with the Method Procurement team to trial the platform for your dental practice and get the most from industry experts as they provide continuous support to optimize the solution and make it unique to your business.Ready for a personalized demo? Contact us now.
July 5, 2022
What exactly is a strategic procurement, and why would your dental practice need it?
Where transactional procurement focuses on immediate or short-term gains, strategic procurement takes a more intelligent approach toward how you purchase your dental supplies for greater financial long-term advantage.
Transactional procurement—buying only what you need at the moment and jumping on short-term sales and supplier rebates to find cost savings—leads to overbuying, extra costs, and higher risks. You can’t avoid having to buy dental supplies; you need them to service your patients and run your dental practice. But how you go about it has a direct impact on your profitability.
Let’s take a look at how through strategic digital procurement, you can leverage your purchasing volumes and technology for deeper cost savings.
Ready to buy smart and save money? Read on to find out how.
Unlike transactional procurement—which essentially is the buying of supplies and services with little to no strategy, internal processes, or thought given to who you buy from, how much you buy, and what you should be paying— strategic procurement aims to reduce risks and minimize costs for the long term.
Strategic procurement will take into consideration things like supplier relationships, budget, market dynamics, and company goals.
Although the goals of strategic procurement should be designed to align with your company goals and business process maturity level, they may include:
Learning to do more with less is a great way to fight the impacts of the current talent shortage. And by decreasing your overhead through strategic procurement, you can improve profits now and in the long term. Remember, unlike revenue, every penny you save goes straight to your bottom line. A spend management solution made specifically for the dental industry can help you achieve both; do more with less, and do it better, making smarter buying decisions with increased market visibility and streamlined workflows.
Below we help you on your way by walking you through the 6 steps of developing a procurement strategy that will help you meet your objectives. We start with what may perhaps seem obvious—analyzing your needs—move on to the less obvious, including setting your procurement guidelines—and end with continuous improvement. Because if you want your profits to continue to improve, your business must as well.
What do you buy? How often? From who? In what quantity and at what price?
private-labelMany dental practitioners are rudimentary in their business processes and do not issue purchase orders when purchasing supplies or services or track purchases through a spreadsheet. This lack of discipline and supportive technologies means suppliers don’t have the visibility to answer these imperative questions.
With the right spend management platform, you can leverage technology to help you easily create a product catalog and start tracking your purchasing and spending habits. Trust us—the data will come to good use, allowing you to leverage your volumes for better-than-market pricing.
Before you decide where and how to spend, it’s important to get a lay of the land and understand what suppliers can meet your different needs. What other suppliers sell the products you buy, and at what price? Which suppliers are consistently lower priced? Are there certain items you’re significantly overpaying on? Are there private label options you should be considering?
Although this is possible by logging into supplier portals and checking prices and availability of one item and one supplier at a time or requesting pricing through sales reps, it is hugely time-consuming and, quite frankly, in today’s environment where people are in short supply, not likely to happen.
Luckily, there’s a better way.
With a detailed product catalog of over 850,000+ dental supplies and access to a 2,000+ dental-specific supplier database, a procurement platform like Method Technologies brings the market to your fingertips. An Amazon-like shopping environment allows you to quickly and easily compare pricing from authorized dealers, including standard internet pricing as well as any of your negotiated, group, or DSO pricing.
Keep in mind that market conditions frequently change. Therefore, we suggest you make sure sure the information you rely on is current and frequently updated. Method offers the real-time visibility you need to gain a thorough understanding of the supply market for strategic, insights-driven decision-making.
So, you’ve identified what you need and completed a have gained a good understanding of the supply market. Now it’s time to set your goals.
Perhaps you’ve realized you’re significantly overpaying for certain dental supplies and your first objective is to buy from the lowest-priced suppliers. Or maybe you have a long-standing partnership you hold trust in but feel it’s time to onboard a second and maybe a third supplier to create a more competitive environment. You could be ready to implement a formulary and need a digital solution to help you implement and govern it.
Before you determine and prioritize your goals by the level of importance, you must think through where your biggest issues are and what is most critical to your company, its long-term viability, and your bottom line. Find you’ve been running out of supplies and putting your production rates and service levels at risk? Then perhaps you need to focus on inventory management and ensure you’re aligned with suppliers with proven track records of on-time delivery.
Goals should be well-defined, quantifiable, and measured, following the SMART principles:
Specific – Set clear goals.
Measurable – Define how you will measure success.
Assignable – Assign someone to be responsible for each goal.
Realistic – Make sure goals are both practical and achievable.
Time-related – Each goal should have a set timeline, with checkpoints and end dates.
With your goals in place now, you’re ready to establish rules and implement best practices and standard procedures that will get you where you want to go. Although this will look different for every practice depending on your objectives and current ways of working, ideally, your procurement guidelines should be used by every person involved in the procurement process and should be adapted to your needs.
Here are a few things you may want to consider:
Technology plays a critical role in implementing your strategic procurement strategy, making what previously seemed impossible, possible. But better procurement is a journey, and your business is growing, and the solution you choose needs to be capable of growing with you.
Dental practitioners and DSOs should look for a digital solution that covers areas such as RFQs, inventory management, spend control, budget monitoring, and data analytics and partner with solution providers who are ready to hold their hand and help them every step of the way. The right solution should help you gain full visibility over your procurement process, optimize your vendor selection process and help you more effectively manage your inventory and monitor your performance.
As we’ve already stated, strategic procurement is a journey, and it’s important to understand it’s one that may involve a long series of small steps.
A core principle of the Toyota Production System, Kaizen (roughly translated to “continuous improvement.”) is based on the principle that small but significant improvements, that involve all employees and build a company culture of continuous improvement, lead to big changes.
Want to learn more about continuous improvement? Our Fundamentals of Continuous Improvement series covers Lean Six Sigma for Dental Practices, Keeping it Simple with Kanban, and Lean Inventory Management for Dental Practices.
Learning to extract value from your procurement process can help you unearth competitive advantage and allow you to fight off some of the cost increases eroding your margins. Maturing your procurement practices and transitioning from transactional to strategic procurement involves more than leveraging your volumes.
When yur practice is ready, there is more value waiting to be extracted through:
SRM is one of the largest differentiators between transactional purchasing and strategic procurement and is your most valuable tool for extracting value from your supply chain.
It’s about nurturing relationships and collaborating with preferred and strategic suppliers to build mutually beneficial long-term partnerships that fuel organizational growth and is the key to procurement success. Setting objectives, monitoring performance, and ensuring supplier progression are all part of a solid SRM program focused on continuous improvement.
Gather more tips on how to do SRM right in The Dos and Don’ts of Dental Procurement Supplier Relationship Management.
Elon Musk put it best when he said, “The Supply Chain stuff is really tricky.”
The dental supply chain is indeed a tricky one. Disruption, whether it be extreme pricing volatility, labor issues, logistical bottlenecks, or a shortage of supply, can happen at any time. Post-pandemic, understanding your supply chain and how you can mitigate the risks that lay within it is crucial for safeguarding your continuity of business and profitability.
Risk Management is a vital part of strategic procurement, often informing your supplier selection and driving your procurement strategy. To find out more about the dental supply chain and the mistakes you should be avoiding, check out How Does the Dental Supply Chain Work?
Those looking to optimize the procurement process and drive profitability have started to leverage procurement analytics. The right spend data can empower improved spend management, helping you gain tighter control of your purchases and avoiding costly mistakes so you can buy smart and save money while freeing up cash flow for healthier profits.
Procurement analytics can enable you to
If you’re a multi-practice DSO, analytics can help you visualize trends across locations, departments, categories, and even at the product level, so you can find synergies and anomalies that may represent opportunities for improvements.
Implementing procurement best practices can help you reduce the potential for fraud, ensure you pay no more than you should for your supplies, and boost your EBITDA. Implementing proper purchasing controls is an important part of the journey to strategic procurement, and with the right spend management solution, it may all be much easier than you imagine.
Strategic procurement is about more than finding cost savings. It’s about doing things in a rational, thought out method that betters your practice and makes life easier for the very employees who spend their working hours committed to its success.
Improving your efficiencies and your profits with digital strategic procurement secures you savings and preserves your long-term viability, so you can get on with putting a smile on your patients' faces for many years to come.
Ready to check out what Method can do for you? Call us to arrange a personalized demo.
July 1, 2022
Method operates on the premise that by providing a fair and equitable marketplace that brings business opportunities to vendors and suppliers, big and small alike, and greater market visibility to buyers, we can create a healthier, more vibrant dental ecosystem for all.Because healthy competition is just that, healthy. In a competitive and transparent market where companies are forced to differentiate themselves, they ultimately provide better products, services, and pricing to consumers. They're more likely to invest in designing and improving products and drive out operational costs through continuous improvements.Essentially, a competitive environment motivates and inspires suppliers to do their best rather than just good enough. But to cultivate a healthy competitive landscape, the playground must be a fair one—something Method is working to create.
According to Precedence Research, the global dental consumables market size is predicted to hit around US$ 65.18 billion by 2030—showing there is plenty of opportunities for ALL to do their part in providing top-quality, affordable dental care.To ensure fairness as well as safety, we abide by the rules of procurement ethics, as well as that of personal data privacy.In a world of increasing digitization, it is still up to humans to design the process, rules, and algorithms that keep personal, business, and supplier data safe and secure, and at Method, we take that responsibility seriously. Not only because it's required, but because it makes for good business, for us, and for our clients.Here's how.
By delivering current market pricing and the availability of dental supplies to the fingertips of our clients, we make shopping smart easy. This obviously benefits our clients, empowering them to save on the costs of their dental supplies and improve profits, but it's also good for sellers.For suppliers and distributors, especially the "lesser-knowns," Method helps bring them into the line of sight, without the need for a salesforce or marketing or any of the other resource-draining sales tasks. It's a step in the door without having to knock on the door.
Issuing and participating in Request for Quotes (RFQs) is known to be a cumbersome, time-consuming process for all parties, creating a barrier of entry for those with fewer resources.By offering a digital, easy-to-access, and fast-to-complete RFQ process, Method removes that barrier, allowing for quicker and easier participation and affording more opportunities to small and medium-sized suppliers.
As we stated in the ethics of dental supply procurement, even the appearance of inappropriate behaviors can harm your business's reputation, limit your ability to foster a competitive environment, and lessen the efficacy of your dental supply inventory management and purchasing practices.The best outcomes are achieved when suppliers happily go the extra mile, sharpening their pencils, removing costs, and providing value-adds, all on their own accord. Although playing favorites and feeding your suppliers competitive, non-publicly available pricing that you've received from other suppliers may garner you a few pennies in the short-term, in the long-term, it eliminates the very competition that keeps your prices moving in the right direction.Remember, without competition to keep them fighting for your business suppliers will be quick to increase prices and erode away those cost savings you were striving for.
"Supply management professionals have an obligation to ensure confidential and proprietary information is adequately protected."—Principles and Standards of Ethical Supply Management Conduct with Guidelines, Institute of Supply Management (ISM)This includes, but is not limited to:Contract terms and conditionsBids and quotationsProduct and other costsAny information not available from public sourcesManufacturers, distributors, and suppliers want and appreciate transparency and expect a fair and equitable playing ground, and rightly so.Businesses, their trading partners, and the salespeople that represent them work hard to reduce operating costs and offer you the best possible price and service they are able and should be compensated accordingly.By setting the rules of engagement and engaging in fair play, you afford equal opportunity to all, ensuring suppliers remain motivated and continue to vie for your business for years to come.ISM offers guidelines for confidential and proprietary information, which include:Do not accept or share confidential or proprietary information unless there is a need to know.Use confidential and proprietary information only for its intended purpose.Mark and identify confidential and proprietary information appropriately.DSOs may want to create their own ethics policies and guidelines, covering data privacy as well as other areas of risk such as impropriety and conflicts of interest. For further guidance, see ISM's Principles and Standards of Ethical Supply Management Conduct with Guidelines.
Method is committed to ensuring that your privacy is protected.According to the U.S. Department of Labor, Personal Identifiable Information (PII) is defined as:"Any representation of information that permits the identity of an individual to whom the information applies to be reasonably inferred by either direct or indirect means.Further, PII is defined as information:(i) that directly identifies an individual (e.g., name, address, social security number or other identifying number or code, telephone number, email address, etc.) or (ii) by which an agency intends to identify specific individuals in conjunction with other data elements, i.e., indirect identification. (These data elements may include a combination of gender, race, birth date, geographic indicator, and other descriptors). Additionally, information permitting the physical or online contacting of a specific individual is the same as personally identifiable information. This information can be maintained in either paper, electronic, or other mediaAs Method has access to Personally Identifiable Information (PII) and other sensitive procurement data, we hold a special responsibility to safeguard that information, protect it from loss or misuse, and provide full transparency on the occasions where your Personally Identifiable Information may be used.As stated in our Privacy Policy, Method does not rent or sell your personally identifiable information (such as name, address, telephone number, and credit card information) to third parties for their marketing purposes. See our Privacy Policy for further details on certain legal circumstances where we may be required to share data.The policy further sets out how Method collects, uses, and protects any information you may provide when using Method's websites, mobile apps, social media pages, or any other products or services offered by Method ("Services").Rest assured that any information by which you can be identified that is provided to Method through its website will be used only in strict accordance with our Privacy Policy.In the spirit of full transparency, it's important to note that Method may share aggregated non-personally identifiable information either publicly or with business partners like publishers, advertisers, or connected sites. For example, Method may choose to publicly share information that identifies trends regarding the general use of Method's websites and/ or other products or services.In today's environment, cybersecurity and data safety must be taken seriously. Digital solution providers that have access to PII and other sensitive information hold a responsibility to safeguard data from being misused by third parties for fraud by ensuring the proper usage, handling, processing, and storage of all PII.To fully understand how we keep your data safe and how your information may be used, we fully encourage you to read our Privacy Policy and reach out to us with any questions.
June 24, 2022
When venturing into the world of private practice, as a dentist, you must exercise your ‘business head’ and take care of your dental office budget. Making revenue from the day-to-day operations of your dental practice without a formal budget and strategy, even the highest revenue streams won’t let you reach your full potential.Understanding the cost of running a dental practice is not enough, so as the person responsible for the success of your business—and it is a business—it’s important to understand how to analyze finances, create a template for budgeting, monitor your overhead, and get the most out of your budget to increase profitability.
While it can be tiresome to run a dental operatory and take care of financial planning, it’s a task that will encourage cost-saving benefits and support the business.Budgeting is an extra task, yes, but it can be simplified if you’re able to produce a budget template. But what should be included? It starts by determining how granular your approach will be.Depending on how large your business is, you could take different approaches to analyzing your expenditure. First, if you operate more than one dental practice, you’ll want to collate data based on location (i.e., create a separate budget for each premise that your practice operates).You can also take this one step further and cross-reference your finances in particular categories to gain a holistic view of the overall business expenditure while comparing all facets of the business.You’ll likely want to group costs into categories, such as:
Once this process is taken care of, you can set out your dental practice budget and calculate the costs based on sub-categories such as hygiene which will provide a better overview of these particular areas of expenditure within the business. Itemizing this data will provide a total figure for expenditure and break the overall costs into actionable groups.Collecting this data alongside revenue is the first step to creating an effective financial plan for your dental practice.
What is overhead? You may be wondering why this term is so significant. Understanding what your overhead consists of and the percentage of your finances that it accounts for will provide figures that you can use to begin managing the overall costs of running your dental operatory.Overhead is effectively your expenditure–and we’re not talking about you paying to have your teeth whitened. This word is the umbrella term for all costs to your dental practice before, as the owner of the business, you pay yourself. Overheads can be represented as the percentage of your revenue that goes towards the costs you’ve just calculated in your budget template.Your percentage overhead is a good indication of how your dental practice performs financially, and when it comes to buying a business, this could represent the performance of a practice based on the industry average. Currently, the industry average of a dental practice overhead is around 61.9%.Assessing a dental practice against this industry average (also depending on the value of the business), whether it is your own or you are looking to purchase or expand, will provide insights into its performance. If the revenue of the business is higher, the general consensus is that the percentage of overhead will be higher.As an example, the percentage could reach around 64% for a business with annual collections of US$2mn or higher. In contrast, it would be deemed average for a dental practice receiving revenue of US$500,000 to US$1mn to incur a 60.1% overhead. Therefore, be sure to check the industry average based on your annual revenue calculation.So, how can your dental practice use this data?Whether you’ve begun to create your budget or you require a quick assessment of the year’s financial performance, your overhead can provide a quick indication of the costs involved in running your dental operatory. If the percentage is higher than the industry average, it could mean that you’re overspending on a certain category within your budget.Industry information is only a guide to assessing where the dental practice stands. It’s likely that your overheads are higher than you expected, and there is room for the business to reduce costs and simplify processes. At this point, the next step is to look at exactly how you can cut costs. Understanding industry norms and trends will help with this.
Generally, payroll is the highest cost that a dental operatory will incur—and perhaps one of the most difficult ones to manage as your staff needs to be paid! It may be wise to review this cost category and devise a more effective way to manage staff. If, for any reason, you employ contractors or agency personnel, carry out an analysis of the benefits. Subcontracting work to labs or employing people from agencies can increase costs if not managed correctly.Alternatively, you could be spending more than necessary on inventory, which could indicate that a leaner approach to stocking dental supplies may be in order. You may also find that digitizing processes in the dental office could reduce your need for consumables, such as pens, paper, and other stationary equipment, while increasing your efficiencies (meaning you can do more with less).Alternatively, there may be fixed costs involved that could potentially be reduced. Take a look at your insurance payments and utility costs and see how they can be managed better or it may involve renegotiating pricing and payment terms. Maybe you are spending heavily on marketing with minimal reward as some channels may not be the most lucrative for your business.
As mentioned previously, digitization is an effective solution for minimizing some of the costs to your dental practice, but digital solutions can do much more than that when it comes to procurement. Consider procurement software as a way of collating, analyzing, and reducing the cost of running your dental practice.Dedicated procurement software allows for a swift calculation of your spending across all of the categories within your budget, which will help you determine the areas of inefficient spend.From the creation of your budget to spend management, procurement solutions can save you time when it comes to your annual budgeting period, with inventory management solutions tracking items going in and out of the practice. A digital approval process helps you ensure you stay within budget. And importantly, procurement software will also create ease when it comes to negotiating pricing, helping you reduce costs and bring down that overhead.
Method Procurement is designed by dentists for dentists. The dedicated dental procurement solution helps practice owners, managers, and operatives to seemingly integrate inventory, payments, and all other procurement into an easy-to-use platform, which lets you spend less time on accounting while saving money on procurement processes.Method Procurement could provide you with a Personalized Demo of its procurement software with continuous contact and support from the team to provide the best outcome for your dental practice.Arrange now, and you’ll gain better insight into ways streamlined digital procurement can help you simplify repeated tasks while saving on the cost of your dental supplies.
June 16, 2022
Kaizen (roughly translated to “continuous improvement.”) is a core principle of the Toyota Production System (TPS) focused on setting a gradual adoption of small but significant improvements.Organizing your dental supplies is not a simple task. It requires careful consideration to optimize a workspace and find better ways of doing things. Although it may seem like now is not the time, as you have bigger fish to fry, in truth, big improvements come via small steps, and this fish may be bigger than it appears.As the industry continues to struggle with a shortage of human capital, the need to learn to do more with less is amplified. Taking the time out to get organized may be a challenge, but it may also be imperative. Let’s take a look.
Before delving into drawers and shuffling around the shelves, it’s essential to understand why you want to organize—or even reorganize—the space.Organization is key to efficiency, allowing you to optimize productivity. By ensuring your staff doesn’t waste time looking for the supplies they need to perform their jobs, figuring out what you need to order when, or tracking down and expediting rush orders, they can better prioritize the needs of your dental patients or free up time for more critical, revenue-creating tasks like following up with patients. It also contributes to a calm work environment, helping your overloaded and stressed staff work more effectively, and happily.To make this a good use of your time, it’s worth discussing the requirements of your staff to learn how to make the area work better for the entire team.
You’ve gathered all the insights you need from your daily dental operations and have listened to the requirements of your team. Now it’s time to sink your teeth into it…but where should you start?This seemingly daunting task begins with a purge! Compartmentalize the office into categories and pick one as your starting place. As an example, this could be office supplies (pens, paper clips, and anything you would find on an office desk). Sort through all supplies in one category and separate them into three groups—trash, recycling, and a donation pile—using containers or boxes might make this easier.Searching through dental office supplies can take some time, and you may find yourself questioning your choices, but stick with it. If you come across items that you’re unsure of, here is are some good questions to ask yourself:
If ‘yes,’ ask this:
As you purge through the items, separate them into categories in your ‘keep’ pile so that you can easily visualize your storage needs. Adopting a mindful approach to organizing your dental office supplies is a more productive way of selecting the essentials.
After the sorting process, you should have already separated the ‘must have’ items into groups of similar materials. Doing this will make the next step much easier as you think about storage.Now that you’ve separated all office supplies, it’s time to put them away. Using containers, boxes, cupboards, and other storage solutions that are already available in the dental office, find a home for everything but take time to consider where each item should go. A few things to think about include:
This mindfulness will help you put all of your dental office supplies in the most optimal places, thereby optimizing your employees' time. It’s also worth discussing this with a member of the team, either during or after the process, to get a second opinion on where items should be placed—those who work with the supplies most often may point out an issue or a more suitable way to organize the space.
It’s true. Something as simple as labeling can really speed up the way your team works. Try it, and you’ll be amazed at how quickly you can spot the gaps on shelves or find items that are stowed away neatly in containers (providing you followed the previous tips).It’s not just about writing the names of equipment on pretty labels either. Labeling is an important method of separating sterile and used utensils in your dental operatory. Sterilization tape proves to be a great item for this as it changes color when exposed to certain chemical vapors (i.e., you know when a tool has been sterilized).The last thing you want to do is fumble around for clean dental tools while you have a patient waiting in the chair. It may take some time to get used to labeling, but in the long term, it will prove to be a leaner method of operating and will provide you with more time to tend to the needs of your clients.
The sterilization process mentioned is undoubtedly one of the most critical in a dental practice. Multiple clients will come through the door daily, and it's important to make sure that you have your turnover items ready and waiting for them, for example, barriers, wipes, disinfectants, and other sterile items that are critical for infection control.Turnover supplies are used multiple times a day, and the previous steps mentioned will help determine a suitable position and quantity for them. Maintaining a methodical process hinges on how well you manage the stock of those supplies and ensuring that the items are kept in the correct places.Other turnover items that don’t fit into the ‘consumables’ category require a different process. Utensils should be sterilized along with motorized equipment. This is seemingly more urgent as these items are used multiple times per day and for various patients. Keep these tools in a separate place where they remain together as a kit. Each morning you can remove the whole kit from its designated place and be ready to start the day.Pro Tip: Use a sterilization-safe marker to label these items, and be sure to add the sterilization date after every clean.
There are two main reasons why you would create procedural guides for every process—the first is to create a reference. Both yourself and your dental operatory staff will follow many procedures, and if there are any discrepancies, having the process guides available will allow you to check and remediate any issues or inefficiencies you may have.The second is training. Onboarding new members of the team can be strenuous at the best of times, and process guides help you to teach new staff how to carry out the procedures of your practice. It’s also worth noting that no process is the same, and there is further disparity from organization to organization. Personalize every procedure that your staff must follow and refer back to them to determine any further inefficiencies or, in worst cases, find a solution to a problem.If you’re a fan of labeling, you’ll also like the idea of version control. If any changes are made to the way that you work—be it in relation to dental office operations or regulation changes—creating a new version of process guides, which are dated, will allow you to quickly find out where the changes were made.
Built by people in the industry for people in the industry, Method’s Procurement solution was designed to meet your dental office needs.From dental inventory management to procurement, Method’s platform is a perfect fit for dental operatories of all sizes. Built for ultimate flexibility so can implement processes that suit your practice and allow you to most effectively manage your day-to-day operations.Get the most out of your organization's efforts and let Method solutions help you carry out the menial tasks, so you can focus on your practice, team, and new and existing clients.To find out more about Method Procurement Solutions or arrange a personalized demo, click here.
June 6, 2022
As of August 2021, the industry saw a reduced workforce of 3,300 dental hygienists, or 1.6 percent —“COVID-19 and the Dental Hygienist”, ADA and ADHAThere's been a lot of talk of the 'great resignation,' and the dental industry has been far from immune, suffering a mass exodus of dental hygienists. And according to Becker's Dental, it doesn't seem likely to abate anytime soon as even with significant pay raises, dental offices are still experiencing issues attracting hygiene staff.Pre-Covid surveys showed one of the primary reasons dental hygienists chose to seek a new occupation was that they didn't feel valued or respected. A high-stress office environment further contributed to the situation.It comes as no surprise then that, as we saw at the ADSO summit, the industry is abuzz with talk of the ROI of culture and the need to increase efficiencies so practices can do more with less. Of course, of the employees that do remain, more is being asked of them as responsibilities continue to expand.As the old saying goes, it's time to work smarter, not harder. Practice owners must find solutions to alleviate the pressures, improve morale and lower costs.As we've been known to do in the past, we thought it a good time to take a look at the philosophies and practices of neighboring industries to see how practitioners can remove any bottlenecks to increasing productivity so they can effectively function with fewer people.
Established sometime in the early 1960s, the People, Process, Technology (PPT) framework is used by manufacturers and businesses to improve employee and operational efficiencies. By analyzing and managing how the three elements interact and interplay, you can optimize outcomes by leveraging all three in a balanced manner.Imagine a three-legged table. Too much or too little of any one leg throws the whole table off-kilter. Although all three—people, process, and technology—play a significant role in accomplishing work, when balanced correctly, together, they achieve more.Despite technology being often touted as a savior, it is only as effective as the people and processes it is meant to enable. Let us explain.People on their own are precious, capable, and knowledgeable. However, unlike technology, they are prone to human error and limited by physical capabilities. Without the right processes, employees' actions can be ineffective. However, automating inefficient processes only serves to compound issues and fails to extract the value technology can bring.When standardized, processes have the ability to improve the work of many, but if incorrectly designed, they can be overly cumbersome, adding cost and limiting outcomes. Thereby, when it comes to increasing productivity and improving efficiencies, there is no one true hero. The trick is in finding the right balance, using each to enable the effective use of the other.
Although we would like to suggest you ensure to have the right people in the positions that best fit their skills, at a time when human resources are scarce, you may have no option but to have people performing tasks they perhaps aren’t best suited for. This makes proper training and culture even more imperative.Your people should carry the right attitudes and know-how to correctly perform the tasks as laid out by the process and, where possible, enabled by technology. This may require additional training and most certainly requires a supportive culture where employees aren't resistant to change and lines of communication remain open. Employees should feel comfortable asking questions and requesting help or offering better ways of doing things.
A process is a sequence of actions that produce a specific outcome. It is your “how”—your formula to success if you will. When structured correctly, it should allow you optimal utilization of your people and technology to produce business outcomes. When a process is standardized, meaning it is performed in the same manner by every employee, then, in theory, it should produce consistent results.While we're here, let's take a moment to offer some clarity on how a standard process varies from a 'best practice.' A best practice is a widely accepted 'rule of thumb' that has proven to be the 'best' (safest) way of doing something. A best practice is generally considered to be such because it safeguards against things like fraud, and human propensities.For example, the three-way match is a best practice where invoice data is validated prior to payment, ensuring you pay for items you ordered at the price you agreed upon and for the quantities you received in good working order.For more examples of best practices and the benefits they can bring, see:
Now, back to processes. For a process to be effective and adhered to, your employees need to understand the entirety of the process, their role within it, and what they're expected to achieve. When creating a new process, ensure to involve key stakeholders during the design and review stages—and listen to their feedback. Provide training and, if at all possible, documentation that can later be referred to.
The technology should enable people to streamline and, wherever possible, automate processes and best practices, eliminating redundancies and reducing opportunities for human error to deliver efficiency. Furthermore, today's technology can empower data-driven decision-making by aggregating and analyzing large sets of data at a rate of speed humans simply can't replicate.It is tempting to look at technology as a fix-all. And in fact, technology does have the power to transform businesses. However, it must always remain in balance, driven by people (with esoteric knowledge, common sense, and experience that technology doesn't hold) and enabling the right processes.Simply stated, throwing tech at a problem isn't necessarily going to fix it. Instead, technology should be seen as a tool, enabling the right people to follow the right processes and making light of heavy work. To ensure the adoption of new systems and optimal utilization, employees must understand the processes, the reasons for them, and what's in it for them. So ensure to communicate how the tech will make their lives easier and how will it enable better outcomes.For example, when it comes to buying dental supplies, a spend management program can help your front office staff manage the long list of dental supplies they need to stay on top of. By doing away with the mass of emails, phone calls, supplier websites, and portals they must deal with and streamlining the sourcing and buying process into one platform, you can drastically simplify the buying process and make life easier for all.Method's Amazon-like "shopping experience" provides all the information your staff needs at their fingertips, so they can make quicker, smarter buying decisions. With digitized inventory management, they’ll even know when it's time to order—saving them time and hassle, and you, money. It's a win/ win.Communicate the benefits, get their buy-in, and let Method help you transform into a more efficient, well-run practice that employees want to work for and patients continue to trust.
Method was developed by people in the industry for the industry. We understand the ins and outs of purchasing dental supplies and the realities of managing and working in a dental practice. We saw the opportunities and have done the leg work of taking a look at the entirety of the procurement lifecycle to see where and how technology could best be utilized to create a more efficient, effective process.You’ll see the PPT principles evidenced throughout Method. They’re reflected in the dental inventory control methods and procurement analytics that allow you to lean out your inventory and improve your cash flow. The purchase order entry process minimizes time requirements and eases workflow throughout the Procure-to-Pay (P2P) cycle. And the ‘at your fingertips’ market pricing empowers employees to make better, more cost-effective decisions, while the digitized request for quote management process empowers your employees to create a more competitive environment so you can leverage your volumes and attract better pricing.And because we understand the criticalness of the PPT philosophy and the need for pragmatic solutions, Method's spend management platform has been designed for ultimate flexibility.Robust enough for DSOs and flexible enough to suit a single practice, Method allows you to leverage technology in a way that makes sense for your business, so you can find just the right balance of people, process, and technology for ultimate cost savings and efficiency gains.Ready to do more with less? Contact us to schedule a personalized demo that suits your dental practice's needs.
May 31, 2022
The costs of dental supplies are rising. Although efficient, strategic procurement can help you mitigate increases and find cost savings; there's more that you can do. But is it really worth the effort?As we delved into in The Low Hanging Fruit: Key Procurement Performance Metrics for the Dental Industry, although growing revenue is a great strategy for growth, it comes with risk, and only a portion of your revenue actually makes it to your bottom line. But on the contrary, for every dollar you save, a dollar makes it to your bottom line.Outside of dental supplies, when it comes to saving money, dentists have limited options that don't come with heavy risk. For example, it's hard to cut back on employee salaries or administrative and marketing costs without facing repercussions or risking service levels.Saving on the cost of your dental supplies and reducing financial waste offers a unique opportunity to add thousands, if not tens of thousands, to your profits—all with limited barriers to entry and minimal risk. So, yes, reducing financial waste is worth the time and effort it may take.So with that in mind, we present to you a few suggestions on how you can reduce your overhead costs and minimize any waste.
You know the drill; A sales rep walks into your office and offers you some free product he has in his car so you can try it before you buy it. Some may refer to it as "grip stock."Whether the rep is pushing products that are new to the market or offering you another brand or private label version of a product you already use in an effort to pull you away from a competitor—trialing any new products to ensure their suitability for use in your practice simply makes sense and safeguards your practice.Ordering supplies without prior testing and approval introduces a myriad of risks to your organization, from a possible lack of compliance to regulatory requirements to impeding patient service levels or increased costs due to poor quality.Your team is responsible for ensuring the best possible patient service and, as such, holds a stake in the trial process and should be given an opportunity to test, evaluate and provide feedback on new potential new supplies. Plus, a clinical trial process can help you finalize a formulary and drive compliance.But besides the critical need for a formal and documented trial process, what's important to stop and take note of when looking to take advantage of "try before you buy" offers, is exactly why you're doing so and where the true benefits for your practice lay.Sales reps will do just that, sell you on benefits and reasons to buy what they're swindling. And although it's natural to always want "the best" of everything for your practice, making the right business decisions for your practice and your profits means cost must be part of the evaluation.If you're trialing a lower-cost product, what are the possible risks? Taking a total cost of ownership approach will ensure any perceived cost savings will be realized on your profit statements. Will the product last as long as its counterpart? If not and you need to buy more, are there ultimately any cost-savings?Higher quality products may give the elusion of value, but is that "value" truly something worth paying for? Can your employees get by just as well with a lower-priced product? Will your patients really be able to tell the difference, helping you retain or gain customers or increased revenue?When evaluating if something is really worth paying for or saving, take a moment to do the math. How much of the item do you buy in a year, what are the total potential savings or increased costs, and balance those numbers off of the above.In the end, any newly approved product should deliver very clear clinical and financial benefits for your dental practice.
Running a dental office isn't cheap. Operating expenses add up quickly and come straight off your top line, thinning out your bottom one. Although you can't avoid the cost of doing business, you can control and minimize it.Of course, nobody is intentionally wasting practice funds. It's not likely your staff has bad intentions, but intentional or not, misspending and mismanagement of purchases happen. To minimize the impact on your profits and gain control of your spend, you may want to take a look at implementing some best practices.Here's what we suggest—and what we can help you with.
As a % of Cost of Revenue:>5% Very good, on par with DSO's5% Good6% Average<7% High (Time to focus on reducing costs)If you're working with Method, you can simply enter your production and goal, and Method will do the calculations for you.
To avoid overspending, prior to placing orders:
Sound complicated? That's why Method is here to help. Simply enter your categories and location budgets into Method, and the approval process will show you all the information you need.Want to decline some items and approve others? That's ok. Method can handle that, too, empowering you with data, leveraging automation, and giving you the flexibility you need to stay within budget and minimize any financial waste.
Price creep—the escalation of prices through small but incremental price increases. As buyers often lack the time and processes necessary to identify and combat the increases with pushback, they tend to fly under the radar. And suppliers take advantage.However, it's not just price increases that may be eating away at your profits. Suppliers can often invoice incorrectly, either due to simple human error or issues and discrepancies in shipping and delivery that go unnoticed and result in inaccurate invoicing. You may be invoiced for more than physically received or at the wrong price.Enter the three-way match, an accounting control measure designed to prevent losses from overpayments, whether from fraud or error. Combined with the three-way match process, Request for Quotes (RFQs) and digital procurement processes can help mitigate price creep and fight financial waste.Let's walk it through.Step 1. If you can, deter price creep with price commitmentsDuring the RFQ process, suppliers can be asked to commit to pricing for a limited time period, typically up to 3 to 6 months. Having suppliers lock in pricing will help to deter price creep, as long as you hold them accountable and ensure you pay what you should. This leads us to step two…Step 2. Identify price increases and invoice inaccuraciesWe'll be honest—this is where dental offices really struggle, the ongoing process of monitoring and identifying price increases and invoicing discrepancies. Without digitization to amalgamate all the required data and documentation into one place, the process can be cumbersome and time-consuming.Supplier mistakes can be costing your practice. Designed to prevent losses from overpayments, the three-way match is an accounting control measure where the invoice is matched to the delivery slip and purchase order to validate information prior to payment.Any invoicing issues found, such as inaccurate quantities, should be investigated and rectified either internally or with the vendor before processing payment. Once any necessary corrections are made and the three documents align, the payment is processed according to the payment terms.Step 3. Fight backInvoice discrepancies should be quickly and clearly communicated to the supplier, with continual follow-up until the issue is resolved.Method's procurement software will automatically store any quoted prices and quote expiration dates. When a purchase order is created, the current effective price will automatically appear on the purchase order. Upon receiving the invoice and performing the three-way match, if you identify a discrepancy, it is suggested you not pay the invoice until a corrected invoice or off-setting credit is issued.However, even without a quote holding suppliers to committed pricing, price increases should be fought against. Price shop before buying, and if you find stronger pricing elsewhere, ensure your preferred suppliers are aware that you'll be transferring business elsewhere due to pricing. And always ask them to advise why the price increases were necessary in the first place and if they're able to offer a discount.In other words, negotiate and fight for the prices your practice deserves.
Things change. And so should your budget. Ensure you take the time out to fine-tune and adjust your budget as needed by establishing a regular budget review process. At first, you may want to start with a monthly review as you could be far off the mark to start and want to either adjust your budget or find where you are overspending as soon as possible. The sooner you pay attention, the sooner your balance sheet will thank you.Regularly analyzing your supply needs is the due diligence you need so you can begin to account and plan for fluctuations or changes in compliance requirements, patient needs, staff changes, or any other of the myriad of things that may impact supply requirements.This is also a great time to look for redundancies and identify opportunities to reduce waste. Perhaps you're buying two similar products and can instead choose one and increase your purchasing power. Or maybe you're overbuying because your inventory area is a mess, and employees are re-buying simply because they can't find what they need. Taking a few hours on a Sunday to organize your stock shelves may save you plenty.Once you're confident, your budget is accurate, ensure you stick to it with a controlled purchasing procedure.
Every order you place comes with both hard and soft costs. The hard costs are, of course, that of the supplies themselves, as well as any extra charges such as shipping fees. Although harder to calculate, soft costs, which include all the labor associated with every order, also impact your efficiencies and your practice's financial outcomes.From the identification and specification of needs to invoice payment and record maintenance, every step of the procurement lifecycle takes time out of your employees' day and, therefore, comes out of your profits. Consolidating your purchases can not only increase your supplier loyalty and service quality, which will get to later, but can save your dental practice money in the long run while mitigating your supply risks.As we've spoken to before, your dental supply chain is a complicated one and comes with many inherent risks. Consolidating your purchases to 2-3 main suppliers such as Henry Schein or Darby, who you order from 2-3 times per month, keeps things competitive, ensures you have a strong supplier base who can support your needs and get you what you need when you need it while saving you on both hard and soft costs.
The better you manage your dental supplies, the more you'll be able to leverage your purchase power and negotiate better pricing. Once you've implemented processes for tracking and controlling your purchases and have established some historical purchasing data, you can begin to renegotiate with suppliers for improved pricing and payment terms.Limiting your purchasing to two to three suppliers creates a competitive environment while not stretching your spend out too thin, causing you to weaken your buying power while increasing administration costs. Actively requoting ensures your preferred suppliers don't rest on their laurels. About once or twice a year, you should be asking your two to three main suppliers to requote based on your supply requirements and purchasing history.This is also a good time to pit them against each other and remember to give your favored suppliers the right of the last refusal, allowing them the opportunity to requote and beat out the competition. But remember to play fair and keep all suppliers motivated to offer their best possible pricing by awarding enough business to each. Be deliberate in your strategy and awarding of volumes.For example, you may want to dispense your total spend as such:Preferred supplier 50%Alternative supplier 30%Third supplier 20%OrPreferred supplier 70%Alternative supplier 20%Third supplier 10%How you dole out your volumes will be dependent on what you prioritize as a business, your current vendor relationships, and what your long-term goals are.You do not have a choice on whether you buy dental supplies or not. Your practice requires them to run. But the less they cost you, the more you profit. So take the time, do it with purpose, and grab yourself those improved margins. And if your vendors are reluctant to help you and support you as they should, find yourself some new ones.Empowered with procurement analytics, inventory management, a robust approval process, and full visibility on current pricing and availability across a product catalog of over 700,000+ dental supplies and a 2,000+ dental-specific supplier database—Method may be just the method you need to reduce your financial waste and increase profits.Call us now to schedule a demo and learn more about our simple, flexible pricing plans.
May 23, 2022
Even overly busy dentists have heard about the supply chain issues plaguing ports and shelves worldwide. The long list of disruptions caused by not only the global pandemic but acts of God and man-made disasters such as the Evergreen being stuck in the Suez Canal continue to ripple through supply chains.Since the onset of the global pandemic, manufacturers have struggled to adjust to extreme changes in demand, lost production time, and decreased efficiencies due to COVID-related shutdowns or labor shortages, the unavailability of raw materials, and logistical challenges. All of which have led to price increases making their way through almost every industry.Ocean freight alone has soared greatly for all trade routes. In August of 2021, freight rates had increased 466% over the previous year.And things have yet to alleviate. According to Freightos.com, importers have yet to see any significant improvement in shipping conditions thanks to continued disrupted schedules and port congestion, combined with omicron slowdowns and Lunar New Year. Transpacific ocean rates specifically remain 8-9X higher than the pre-pandemic norm.So, what does this all mean for the dental industry?
From cellphones and cars to washers and dryers, there’s little that remains unaffected. Unfortunately, the dental industry has been far from immune. Although PPE demand has somewhat stabilized, the country continues its “economic transformation.” According to the New York State Dental Association, supply costs for dental practices have increased an average of 2-3%.Pre-pandemic practices would spend an average of 5.5-6% on revenue on dental costs. Post-pandemic, however, spending is now up to 8-9% of revenue. Due to continuing shortages of critical supplies, inflation could remain high far into 2022.Manufacturers that historically only implemented increases once or twice a year are now instituting multiple increases with 2-4 increases rolled out throughout the year. And not only are they increasing more often, but the increases are higher. Pre-pandemic, the average was 3%. Increases now are coming through as high as 6-7%.Price increases typically remain aligned with the Consumer Price Index (CPI), which reports: The annual inflation rate in the US accelerated to 7.5% in January of 2022, the highest since February of 1982, as soaring energy costs, labor shortages, and supply disruptions coupled with strong demand weigh. Excluding volatile energy and food categories, the CPI rose 6%, the most since August of 1982. Additional to the rate of inflation measured by CPI, suppliers will often add their own margin increases, further exacerbating the situation for dental practice owners and their dwindling profits.So, what can you do about it?
Although you can’t control what’s happening, you can put a procurement process in place that helps you lower the overall cost of procuring your dental supplies. Here are a few action items so you can take control of your supply expenses:
a.) Shop before you buy. Prices can vary significantly from supplier to supplier. Therefore, significant cost savings can come quickly by simply shopping for the best possible price. However, this can be nearly impossible without digitization, given the vast landscape of suppliers, your long list of requirements, and cumbersome processes based on emails, phone calls, and faxes.Method’s digital procurement platform delivers pricing and availability in a detailed product catalog of over 700,000+ dental supplies across a 2000+ dental-specific supplier database to your fingertips—making it easy for you and your staff to make the best buying decisions for your practice.b.) Negotiate better pricing. Although their market pricing is readily available online, most suppliers will offer price reductions for those that ask. A digital Request for Quote (RFQ) process allows you to be proactive in lowering your costs, asking suppliers to offer you their best possible price for your list of requirements.c.) Control and leverage your spend. By focusing on ordering from 2-3 suppliers, you can better leverage your buying power and create a competitive environment where suppliers fight for your business by lowering their costs and ensuring top service.
Streamlined digital processes can help you save on soft costs. Soft costs (such as labor) are harder to measure but still impact your profits. A digital procurement platform can help you increase efficiencies, making it faster and easier for your team to order the supplies they need, save you money, and then quickly move on to doing what they do best, taking care of your patients.
You may be surprised to realize the amount of shipping and invoicing errors that could be costing your practice money. By digitizing the entirety of the procurement lifecycle—from identification of needs to payment of invoice and record-keeping—and implementing the three-way match process, you can safeguard your dollars and pay what you committed to for what you received.
Traditionally, we suggest more of a Just-in-Time (JIT) inventory process that eases your cash flow. However, when prices are likely to continue to escalate, it may be an excellent time to stock up and save yourself some dollars by locking in that price before they do.But do so carefully. We suggest purchasing no more than six months' worth of any supply. But whatever you decide, keep in mind your typical usage and product shelf life. You don’t want to end up having to take a financial hit on any expired product. And remember to use the First-In-First-Out (FIFO) method, so employees use your oldest stock first.
Wherever you are in your procurement processes, Method can help you quickly implement some new strategies to reduce your supply costs and ease life for your employees, making for a smoother, more efficiently run practice focused on providing top patient care.Our simple, flexible pricing ensures you get the features you need and none you don’t, delivering a quick ROI. And our client success team is ready to stand with you every step of the way, working with you to launch your procurement transformation and helping you reach your goals.Ready to save on supply costs and start scaling—profitably? Get in touch for a personalized demo today.
May 16, 2022
Toxic company culture is the No. 1 reason workers are quitting jobs, survey finds — CNBC
Coming out of the 2022 ADSO summit, one of the key takeaways was that company culture is critical and material enough in today’s environment for even CFOs to be talking about it. When it comes to culture, however, things can be ambiguous. So let’s take care of that. Company culture is the group norms and shared assumptions that guide actions. It is how your employees feel, behave and treat one another, and it can be consciously and strategically fostered or bred from the unconscious and passive behaviors of leaders. Culture is born of the implicit and explicit, the rules and regulations your employees are to abide by, everyday behaviors and language, what you reward and celebrate, and what goes ignored. Good or bad, intentional or not, your company has a culture, and it starts at the top because, as Harvard Business Review explains, following the leader is human nature. When leaders learn to leverage this, it becomes a competitive advantage. “They [leaders] motivate us to go places that we would never otherwise go. They are needed both to change organizations and to produce results. In any business climate, good leadership is perhaps the most important competitive advantage a company can have.”
Culture and strategy go hand in hand as one helps drive the other. You can steer your team in the right direction by reverse engineering your culture, guiding operations and aligning teams with your objectives and values. As we stated in notes from the 2022 ADSO, a company culture focused on employee well-being and creates an environment where employees want to work and open candid dialogue is encouraged will help you attract and retain employees and improve performance. Companies with employee engagement enjoy 233% higher customer loyalty than those who don’t — The Aberdeen Group, Employee Engagement: Paving the Way to Happy Customers. The Aberdeen Group’s report outlines the business benefits of taking a strategic approach to employee engagement and how it can lead to improved customer service, a higher customer loyalty rate, and increased revenue. In fact, businesses that created structured employee engagement programs saw a 26% increase in annual company revenue year-over-year.
As your business looks to increase office efficiencies and create a scalable structure, it will inevitably need to leverage technology to implement more mature and effective standard business practices. Developing a culture of change acceptance, trust, and open communication ensures your people respond with the right attitudes, behaviors, and actions that support your company’s growth and development. Ultimately, by proactively fostering the right company culture, you can safeguard your long-term viability and create the framework for scalability — streamlined processes and best practices that minimize your overhead and free up your human and capital resources that so you can redirect them to drive growth and optimize profits.
Culture can be a silent killer. After all, the squeeky wheel gets the grease. Processing payroll, ordering supplies, taking care of patients — there’s a long list of seeming priorities that get in the way of taking time out to look forward, strategize and develop a plan for employee engagement and culture building. However, creating the right company culture that will carry you forward into a better tomorrow is a job for owners that is not to be passed on. You’ll need to commit, dedicate time and take intentional steps to get there. Here are a few action items to get you on your way.
Before forging ahead, you’ll want to gain some clarity on what your culture is and how you’re doing as a leader. Then, you can look at where you want it to go and devise a plan to get there. So take some time to take the pulse of your brand, people, processes, and patients.To gain honest feedback, consider putting out some anonymous surveys to patients and employees. When discussing in person with employees, ensure to encourage open and honest communication. This is a good opportunity to start course correcting, so remember to lead the way with honesty. If things have been tense or an issue has gone unresolved, speak to it. Let employees know you see the problem and plan to resolve it.As we said before, culture stems from the implicit and explicit, so you’ll want to look at both.How is your workplace etiquette? Do you greet your employees every morning? When was the last time you checked in on them? Who do you praise, or reward, and for what? Do you spend your days growling and grumping or smiling and persevering? Are you forward-minded and open to change? Are you proactive or purely reactive?What kind of remuneration, incentive programs, or reward systems do you have in place? Have you established any best practices, and if so, are employees following them? Where are your shortcomings, as a leader, employer, and health provider, and are you working to improve upon them? Are you leading by example and ensuring your and your employee’s actions are guided by patient-centric values?Now how about your team? How do your employees feel as they walk into the office every morning or leave every night? Are they communicating issues or burying them? Are you all in the trenches, fighting the daily battles together, or fighting one another instead?How is your patient interaction? Are you maintaining customer loyalty? What’s the general feeling your patients have coming into your office? And tellingly, are they likely to refer you?And how about your business partners? Are your suppliers treating you right and delivering the best service at their best price or taking advantage of your inattention to increase prices?
Ultimately you’re looking to set the rules of engagement so your employees know how to behave, what you care about and stand for, and critically, what you and your patients expect of them. Actions should be intentional; your employees should be able to tell you why they do what they do.Not only do you want to think about where you want the company to go, but also its people. To keep top talent, you’ll want to ensure individual professional growth through education and training programs that align with employees’ goals.Once you find your gaps, remember to be pragmatic in setting goals and planning your path forward. Look for the ripe fruit and prioritize your must-win battles that will have the largest, most critical impacts on customer care or employee retention.
Culture is dynamic and ever-changing. Fostering it requires constant communication, pulse taking, and redirection when you fall off course. Practice owners need to clearly articulate their goals and bring employees into the fold by letting them be a part of the solution.Remember to say what you do and do what you say. Although written company mission and value statements are great, as are awards, incentive programs, and pizza parties, all must align with your actions, verbal communication, and feedback.For continued improvement, ensure you have a critical path for problem resolution, get to the root of the issue, implement corrective action and follow up to verify effectiveness.Now rinse and repeat with regular overviews taking a hard, honest look at how your culture is being lived, how you and other leaders are doing in leading by example, and how it’s impacting your employees’ well-being and patient care. Are you consistently reinforcing your company values through your actions?Yes, culture is complex and requires effort, time, and financial resources. But the returns are great, resulting in happier, higher-performing teams, better patient care, and improved profits and scalability. So perhaps it’s time you take it seriously.Looking to implement best practices and scalable processes? Get in touch with our team to find out how Method can help.
May 9, 2022
To truly understand our customers and best support their endeavors and growth, it’s essential to stay abreast of industry trends and challenges. We find that the best way to do this is to take every opportunity to meet with our clients and talk to fellow industry experts, like our friends at the ADSO.Here are the key takeaways from our recent trip to Austin to participate in the 2022 ADSO Summit.
The global pandemic served as a cold, brutal reminder of just how much growing-up businesses have yet to do. Empty store shelves and the ‘great resignation’ reflect the immature, limited business practices plaguing our planet, failing us when we need them the most.Prior to the pandemic, procurement leaders had only just begun to pull up a ‘seat at the table,’ garnering the attention of CEOs and shareholders for their ability to impact profitability, productivity, service levels, and growth.Large companies—most often built through acquisitions—have expensive technology sitting on local networks that limit communication and the sharing of critical data. As a result, disparate systems and fragmented processes plagued many industries.And, of course, the evolution of SaaS software, its low barrier of entry, and ability to easily share data across locations and enterprises was still infantile in its development. Only the most advanced of companies improved their visibility and enabled the kind of proactive, informed decision-making that builds resilience.Fast forward to 2022, and you see organizations around the world scurrying to leverage technology for better procurement and supply chain management and finally realizing the criticality of culture in attracting and retaining employees, implementing change, and optimizing business outcomes.The dental industry is no exception—that was the resounding message of the 2022 ADSO conference.The truth is dental practitioners don’t fancy themselves business owners and, generally speaking, fail to train and educate themselves as such, choosing to remain focused on patient care and often simply overwhelmed by the day-to-day.Although we aren’t an exception, the dental industry does lag behind in implementing standard business strategies—best practices and standard processes remain rudimentary at best, less mature than many other industries. The good news is that SaaS solutions now provide the opportunity for practices to leapfrog into a more efficient and profitable future.As our team explains it, most of the conversation revolved around two main challenges—The ROI of Culture and how to do more with less.
The industry-wide need to retain employees has led to the emergence of a new buzzword—The ROI of Culture. Of course, the term itself implies that culture is something worth spending time and maybe even money on, but what exactly is it, what does it really impact (or is it just a whole lot of fluff?), and well, how do you get yourself a good one?They say mindset follows culture, and it’s quite true. Whether a result of passivity or strategically fostered, company culture is how your employees feel, behave, and react. By creating a culture that aligns with your strategy and values, you can ensure your employees’ actions and your company's trajectory align as well.For instance, a company culture that is focused on employee well-being and creates an environment where open, candid dialogue is encouraged will help you attract and retain employees.And by developing a culture of change acceptance, you can make for an effective, well-run dental practice where growth provides employees opportunity, patients receive ultimate care, and healthy profits secure long-term viability.For leaders looking to drive their business forward and do more with less, culture is a valuable tool that sets the stage for success.
Rising wages for comparable jobs, the ‘great resignation,’ and even supply chain issues have led to a human capital shortage. Across the industry, high turnover rates, staffing issues, and empty pipelines for everything from doctors to hygienists and dental assistants continue to plague practices.Exasperated by Covid, the talent gap has led to some DSOs offering to cover education costs as a perk in hopes of retaining staff. Meanwhile, dental assistants are looking at out-of-industry opportunities in search of better compensation and finding it.According to The American Dental Hygienists’ Association (ADHA), since the beginning of Covid, 8% of dental hygienists have left the profession. And it seems all other dental office positions are following suit.The employees that remain are being asked to wear many hats and expand their responsibilities, often expected to do the jobs of two or three people, furthering the need for solutions that alleviate the pressures.By streamlining processes, increasing productivity, and decreasing required resources, your office can function more effectively with fewer people. Considering the highest cost on a dental P&L is people, increasing efficiencies can significantly impact your bottom line and minimize the deleterious effects of staffing issues.Luckily, when it comes to doing more with less, technology lends a hand, making easy work of complex tasks.The challenges for dental practitioners, however, don’t end there.
Scaling requires a strong foundation—repeatable, efficient processes that can withhold the pressure of increased volume and open and effective lines of communication between departments and business partners.Scaling an unprofitable business only serves to compound your losses. Therefore, a practice must first improve profitability and efficiencies to be scalable.However, due to their lack of business acumen, dental practitioners often fail to execute business strategies, including establishing a vision for the company and communicating that vision to employees.Many are at a loss when building a scalable structure, leading to the lack of a clear strategy and the requisite careful planning across HR, IT, finance, and operations.Further challenges were reported as:
There’s no arguing that the challenges are great. But luckily, the opportunities are even greater.Increasing office efficiencies and decreasing overhead costs with streamlined procurement and inventory management allows you to relocate savings to support scaling or education initiatives.It’s essential to know your business priorities and be realistic when implementing new processes and technologies. Aligning yourself with the right industry-minded partners who understand your dental practice and will be “hands-on” when it comes to implementation and training is critical to success. The last thing you want is someone who passes you a manual and leaves you to be on your merry way.If increasing efficiencies and improving profits is one of your business priorities, you may want to find out more about how Method can help you buy smarter and faster, so you can scale profitably. See how Method Works.[method-blog-cta]Ready for a Demo? Request a Personalized Demo That Suits Your Dental Practice’s Needs.Want to find out more about how to increase efficiencies, productivity, and profits?Then check out some of our other related content:How to Make Your Dental Practice More EfficientHow Effective Dental Procurement Makes You More Profitable5 Essential Tips to Increase Productivity in a Dental OfficeHow to Scale Your Dental Practice Effectively & EfficientlyGetting Employee Buy-In Before Purchasing Dental Procurement Software
May 2, 2022
The dental industry is more competitive now than ever. As a dentist, you're competing with other practices for patients and likely facing challenges in your schedules. This increased competition means standing out and effectively scaling your dental practice is essential for ensuring your success.You need practical solutions for overcoming the challenges that are keeping your dental practice from scaling efficiently and effectively. Fortunately, we've compiled some tips to scale your practice that will help you survive and thrive in the dental industry, attracting more patients and improving their experience.
Knowing how to scale your dental practice and how to become more profitable is essential for ensuring your success. Follow the tips below to scale your practice.
Your staff should regularly brush up on their skills. To ensure your employees are productive and happy, incorporate continuous dental staff training. By investing in training, you will show your staff you are investing in their careers. Ongoing training can also promote a healthy work environment. Try a weekly or daily morning meeting to keep your team members on track. You may also want to consider modifying your employee onboarding experience.
Focus on the details to ensure your dental practice is successful and scales with your growth. Every interaction between an employee and a patient is an opportunity to offer a positive patient experience. There are various instances in which employees can engage with patients to make sure their experience in the dental office is positive. As soon as a patient enters the room, employees can offer them a smile or put an uncomfortable patient at ease by making a quick joke.How your employees interact with patients depends on how you engage with your team daily. Interact with your team the same way you want them to connect with patients.
To give your dental practice a competitive edge, develop new lines of revenue, and better meet your patients' needs, you can expand your services. Keep in mind that if you expand your services, you want to avoid overextending your staff or making changes that could jeopardize your overall patient experience. Before you make this move, consider how you will carefully allocate the resources needed to make this change successful.
You can increase your dental practice's efficiency by improving productivity. Poor business systems like an unsatisfactory employee onboarding experience, outdated practice management software, and no continuing education plan can lead to low productivity. Consider the tips below to increase efficiency.
If your dental practice has been growing, it may be time to expand your team. Without an adequately staffed office, you won't be able to scale your dental practice. Hiring dental assistants and front desk staff may be key to preventing your current team from becoming overworked. To keep your dental practice operating efficiently, determine whether you are understaffed and need to add more team members to your office.
Your dental practice can become more efficient by implementing more automated and digitized solutions. Keeping up with the latest workforce management technology will keep your practice efficient and make your staff happy. Utilize digital solutions that simplify repetitive administrative tasks and reduce the risk of human error.Rather than fill out a patient registration form in person, a patient can fill out and submit a digital form through your website prior to their first appointment. With digital forms, you can avoid having a crowded waiting room and reduce reception waiting time. You can also automate appointment reminders and follow-up text messages or emails. By replacing this tedious, time-consuming task with automated technology, you will save your staff time and increase your efficiencies.
There are limited hours in the day, so capitalizing on your working hours is essential for increasing productivity and maximizing your bookings. Create policies that establish a fee schedule for missed appointments or 24-hour cancellation notices. You can also create more flexible hours to serve patients later in the evening or early in the morning to optimize your staff's time.
Patients have more options now than ever for dental care. A quick internet search or social media post can help an individual find their new dentist. For your dental practice, this means learning how to attract patients and how to run a successful practice that offers an excellent experience. To attract new patients to your dental practice, you need to identify what makes a dental office unique and how your practice can stand out.
Consider what makes your dental practice stand out from the competition. Can you easily define a few unique characteristics? If not, you may want to work on making your practice more unique or reviewing the best parts of your practice that you can start highlighting in your marketing efforts. If you have state-of-the-art imaging equipment, for example, you can market this to show you are investing in your patient care. For inspiration, look at your competition and determine whether you can identify their top unique characteristics.
If you have not yet established an online presence, now is the time. Your practice's branding and voice should be consistent across all your social media channels so you stay recognizable. Identify your unique selling proposition, then make sure your website is easy to navigate and user-friendly. Your website should include patient reviews, as these are powerful digital marketing resources.
One of the most effective ways to attract new patients is by asking for referrals. You can use a few methods to encourage or incentivize patient referrals. After an appointment, send an email asking your patient about their experience and implore them to provide a referral if their visit was positive. You can provide referral cards patients can give to friends and family and even establish a referral contest in which each referral increases the patient's chances of winning a prize.
Owning a dental practice involves constantly managing patient satisfaction. However, keeping the patient experience at your dental office excellent while also scaling your practice can be overwhelming, which is why we have listed some tips below.
Make communication between your dental office and your patients as convenient as possible. For example, allow patients to schedule an appointment on your website or via text message. Patients are much more likely to read their texts than their emails and will perceive the communication as much more personal, helping you to build your relationship with them.You can also offer different payment methods like cash, check, card, or installment payments. Money is a concern for many patients, so offering various payment options increases convenience and can make the costs of dental care more manageable for them.
Lead by example and ensure your dental practice's actions are guided by patient-centric values. Make sure your entire team shares the same values associated with workplace etiquette and patient interaction. When you prioritize your patients, you can improve their experience.
Establish a happy, healthy office culture that impacts the patient experience. As a dental practice owner, your mission is to provide the best patient care and employee experience possible. Employees want to enjoy their workspace, look forward to coming to work each day, and be proud of their work. Facilitating this will give your staff a feeling of belonging, which is essential for reducing employee turnover.Take a few steps to develop a vibrant culture, such as holding regular team-building exercises or outings and scheduling one-on-one meetings with key team members to inspire them through leadership and guide them toward their career goals.
At Method Procurement, we know how to make your dental practice stand out. Since being founded by a group of technology and dental industry veterans, we have been partnering with dentists like you to build better dental practices. We offer inventory management software for dental service organizations (DSOs) and dental practices that results from our combined passions for software and dentistry. Our solution is tailored to the unique challenges dental practices face every day.We understand how dental procurement works and deliver the expertise you can rely on. Request a personalized demo from Method Procurement that suits your dental practice's needs.
April 25, 2022
Your dental practice uses a wide array of supplies to serve its patients, likely including both branded and private label products. Analyzing how well you purchase those supplies allows you to identify opportunities for improvement. By better leveraging your buying power, you can realize cost reductions and increase operational efficiency, improving your profitability.
In this post, we’ll cover the most critical aspects of procurement analytics and how they can provide insight into your inventory management and procurement habits and practices.
Increasing visibility on your procurement habits opens new avenues of effective business management, so you can learn to work and buy effectively and get on with taking care of patients and scaling your business.
Whether you’re a DSO or a single practice, read on to find out how dental procurement analytics can help.
Dental procurement analytics empower better spend management, helping you take control of your supply purchases so you can improve profits and free up cash flow.
Improve profits and cash flow by:
The right spend data can assist you in transitioning your procurement lifecycle to a savings lifecycle and implement the governance you need to execute on savings projects, tracking improvements to your bottom line as you progress.
By visualizing trends across multiple locations, departments, categories, and even at the most granular product level, you can highlight opportunities for improvements by identifying synergies and anomalies. For example, did you purchase too much of a certain item that then sat in stock for far too long, or buy the wrong compound and then have to rush in the right one and pay extra fees? Dental analytics can help you avoid these types of costly mistakes.
Procurement analytics will let you know how you’re doing. We know that ideally, a dental practice will spend 4% to 6% of its overhead on supplies, for an office that spends $650,000 on overhead, that comes out to be $26,000 to $39,000 a year.
However, many dental practices don’t meet the ideal benchmark. According to an Aldrich report, the average single dental practice spends 7.2% of collections on supplies, which means there’s plenty of money being left on the table. Procurement analytics can help you monitor the spend of each of your practices separately and compare against benchmarks so you can see where you should be doing better.
You can also analyze your purchases by department or category to further fine-tune exactly where you may be going wrong or improve future materials cost forecasting.
As we’ve said, your dental office relies on a very long list of dental supplies required for providing the high level of patient care that you do. Managing and tracking each transaction—including the supplier, manufacturer, and supplier part numbers, pricing, dates, etc—for each and every item you purchase via spreadsheets and emails is extremely cumbersome and prone to error.
Historically, garnering procurement analytics meant digging out documents upon documents, gathering everything onto a spreadsheets and manually building reports. This is why most dental offices lack good visibility into their past purchases. Without the right software solution, it simply isn’t viable for most offices to spend the time needed to track, never mind analyze their expenditures.
Today, powered by automation, procurement analytics can combine data from many different sources and aid in informed decision making, even predicting future purchases and helping to create budgets.
Perhaps most importantly, procurement analytics allow you to measure business success by monitoring against Key Performance Indicators (KPIs) such as average onhand inventory, turnover rates, inventory write-offs, and cost savings.
Know how much you spend on a specific item or with each vendor, so you can roll out procurement strategies that leverage your volumes for better pricing.
For instance, you may be able to standardize your purchases to better leverage volumes across locations by having each location move to a private label alternative and negotiating a special rate with the manufacturer. Or, to avoid stockouts, your employees could be over-purchasing items with a short shelf life, causing you to incur a financial hit once they expire. With better visibility, you can better plan and avoid overbuying and wasting stock.
The right procurement software will have all these capabilities at the ready, so you can quickly improve your dental inventory management and make for a calmer, more profitable practice that has all the supplies it needs and none it doesn’t.
Your spend analytics should allow you to look back at past procurement habits to determine what you’re likely to require in the future, extract valuable information for negotiations, as well as identify opportunities for improvements.
To enable informed decision making, you’ll want to look at your procurement data from different angles and ensure you can answer any questions you may have.For example, your procurement analytics should be able to show you for any given time period:
Extracting valuable information that can inform decision making and drive strategy involves pulling together purchasing history in ways that allow you to look at all angles of your expenditure, including all relevant data points such as product, price, quantity, supplier, unit of measures and even payment terms and delivery location.
By providing the right information from the right view point, spend analysis can assist you in looking beyond past performance and guide you in assessing future performance, trends and requirements as well.
By offering a consolidated view on procurement spend, procurement analytics can help dental organizations to analyse, predict or improve business performance. When utilized effectively, procurement analytics can drive better decision making and improve supplier relationship management.
Although every practice may have their own way of evaluating what is best for them, here are a few key points that may help you in accessing the suitability of procurement analytics for your dental practice or organization:
Procurement analytics can pay off in sizable financial benefits, but to effectively implement their use, you must first define and prioritize the business problems you are looking to solve or processes you are trying to improve upon.
Looking to implement cost savings strategies, standardize the items purchased across locations so you can better leverage spend, or wrangle your purchasing to come in under budget?
Setting your priorities will allow you determine the types of data you’ll need and the kinds of insights required to drive the results you’re looking for.
If you haven’t yet started on your better procurement journey, now’s a great time to start, and Method Procurement Platform with analytics will help get you there. By delivering the benchmarking, insights and performance evaluations you need to ensure improvements, secure cost savings and improved profits.
Discover the ultimate method for driving dental supply savings, contact us now to request a personalized demo.
April 18, 2022
Productivity is something that dental practitioners strive for, and in order to run a successful dental practice, it’s important to bear this in mind when making any changes to your working environment—such as changes to the dental office layout, workflow, and the overall objectives of the team.Option:Productivity is something that dental practitioners strive for—dental office layout, workflow, and the overall objectives of the team all impact the successful running of a dental practice. It’s important to bear this in mind when making any changes to your working environment.While it may be stressful to take time out to assess productivity, the benefits will outweigh the losses over the short period. To set you on the right path toward a productive dental practice, here are five essential practice productivity tips to get your teeth into.
Have you ever heard the phrase ‘work smarter, not harder’? Well, this 100% applies to productivity in your dental practice. Oftentimes, when you ask a colleague how their day has been, you will receive a response along the lines of:“It’s been really busy, but I feel like I’ve not achieved much.”This is a very common and alarming response (we nailed it, right?). In fact, this isn’t exclusive to dental teams. More often than not, everyone feels they have been busy and yet achieved very little within their contracted hours. This shows a lack of productivity in your dental practice—something that could damage your efforts and greatly hinder the success of your dental practice. As the person in charge of a dental team, there are steps that you can take and initiatives or process changes that you can implement to streamline your workflow and make your dental office more efficient. As you will find out below, there are ripple effects on productivity that could make or break the services that your dental office provides to clients and prospective patients.
It works in a corporate environment—in the form of a meeting—so why not facilitate regular conversations with your team? A collaborative environment is usually a more productive one as it allows you to:
Employee welfare is a staple characteristic of any successful team. Listen to your team’s concerns and take them into account. This will not only make your colleagues feel heard, but will also create a more cohesive working environment, allowing them to work collaboratively to implement more productive processes that benefit the entire dental office. ‘Huddling up’ will also allow office team members to put forward any training requirements—and it’s important to ask them about this regularly—that will allow them to carry out their jobs properly and, eventually, more efficiently. For example, even the most user-friendly digital office systems may take a little getting used to. Although your staff may quickly come to grips with the basics, a more comprehensive understanding will help them optimize their use of the technology solutions they’ve been provided and improve their own workflows.
Communication is a skill. Every individual uses it differently, and it takes some longer than others to master it. As the person in charge of the dental practice, it’s in your best interests to ensure that your front desk staff are using it to its full potential—not just ‘correctly,’ as we’ve established there is no formula for effective communication skills. The front desk staff may require some form of training in order to provide the best possible service to patients and the dental operatory as a whole. But surely patients are only calling to book an appointment, right? Like any form of service, the more value you can provide over the phone—or even in person—the more likely you convert them to a long-term client. There are a couple of ways in which you can make sure telephone communications are serving the practice:
Do you want to show patients that you care for their dental health? Make a point of returning calls from clients and ensure the front desk carries out follow-up calls. If a client only needs a dentist once a year, calling your dental team may not be high on their list of priorities!
This is common practice for any organization that provides a service. Listening to complaints is essential, but you’re not humoring them. Taking on board an issue that a client has experienced with your service could reflect your dental team's performance and open up valuable insights that you may need to address. Many dental practices will provide a feedback system—a form to complete after an appointment—to constantly review any services they have provided. While there is value in finding out where the dental practice excels, the majority of ideas to improve your dental practice will come from the complaints, which can uncover the largest gaps in the group’s operations. On the flip side, ignoring feedback from, in some cases, disgruntled clientele may expose the practice to negative opinions. Word of mouth spreads fast! In many cases, although you may not be able to address complaints within hours, days, or even weeks, if you are seen to be rectifying these issues, clients are likely to respond better to any proposals you may have.
The world is going paperless, and not just because it’s safer for the trees. Digitizing your dental office will pay dividends in the long-term for a few reasons:
Like any new process, it takes time to implement a digital documentation and filing system, but once it’s set up, you will begin to witness the improved speed and accuracy of document transfer. Once digitized, x-rays, scans, and other documents can be interpreted in a more efficient way, and the operatory may choose to adopt further technology solutions to do so. Leveraging digital solutions can also help front desk staff to better manage appointments and utilize every scheduled hour of the day to tend to a patient. Implementing a scheduling platform enables your team to better manage the tracking of appointments and—as discussed previously—allows them to maintain client contact and confirm appointments. Working proactively, your team may be able to schedule more last-minute appointments and increase your production rates.
As part of your efforts to digitize the office, adopting a procurement solution that is dedicated to dental practices may be the next thought. Why? Once you have experienced a higher practice productivity level—resulting from both adaptations to your working environment and digitization of administration—you may consider how technology can improve some of your other processes. The procurement of office and operatory supplies is a staple task that can be alleviated with a digital solution and free up your team to work on more important tasks, such as those mentioned—communicating with and serving patients, improving their workflows, and even training. Method Procurement is a software solution that was developed with dental practitioners in mind. Whether your aim is to streamline the operatory by improving the availability of supplies, provide front desk staff with tools to improve their daily workflows, or gain insight into the costs and performance of your dental practice, Method Procurement’s platform is designed to meet the needs of all dental staff.The platform offers spend and inventory management solutions for better office management, so you can increase productivity, and patient focus.
If you’re looking to improve productivity, create a more cohesive working environment, or streamline processes for all employees, Method Procurement can provide you the tools to make the changes your dental practice needs. Still not sure about a digital solution? Method Procurement offers a free demonstration of its platform to ensure that digital procurement is right for your office. In the process, you will be put in touch with dental procurement experts who will assist you in your digital adoption. Alternatively, you can contact the team directly to get started with digitizing your dental office and turn one-time patients into long-term clients.
April 11, 2022
Dentistry is a critical service, which—pre-pandemic—was used by 65.5% of US adults. It requires the ability to provide great patient care at a high turnover, and minimizing time spent on menial tasks allows dentists and dental assistants to spend the majority of each day providing quality services and maximizing production rates.There are simple ways to streamline your dental operatory that require some pre-planning but can be managed digitally once all of the pain points are uncovered. Collaboration between dental practitioners, the organization of dental tools, and a quick-turnover system for resetting your operatory between patients must be established before you begin drilling deeper into your setup and streamlining your work—ensuring the well-being of both patients and practitioners.
The placement of tools and your dental assistant’s supplies can determine how long a patient remains in your care and whether they leave the operatory satisfied or not. Although, of course, the odd ‘tricky customer’ is to be expected. It’s worth taking the time—either when designing the layout or reorganizing the room—to consider where items should be placed for the most fluid patient care.Having an effective dental operatory setup means that clients will be relieved of unnecessary discomfort while both the practitioner and dental assistant create a cohesive workspace that supports their physical well-being.The dentist needs everything at arm’s reach; the most frequently used tools easily accessible from the saddle; the less frequent supplies stowed away in unobstructed draws and cupboards to be accessed at any time. This can avoid overreaching and minimize the potential aches, pains, and musculoskeletal problems that dentists may otherwise suffer from further down the line—carpal tunnel syndrome being a major long-term concern.As alluded to, some patients find the dental experience rather daunting, and minor considerations like the placement of suction tubing—in relation to the patient’s position and even the decoration of the operatory, will ensure the experience is as comfortable as possible.
Dental operatory organization isn’t a mere tidiness exercise. It requires knowledge, preparation, and planning to operate a well-equipped consultation room, and a strategic layout will only make it much smoother. Simplifying and standardizing everything will display your competence to the client, ultimately making them feel more comfortable. With all tools and supplies in specific places, the operatory will run effortlessly, and it will be much easier to know when something is out of place or supplies are low.Consider taking an inventory approach to this task and begin every morning by checking that every item is in its place. There is no universal blueprint for this. The organization of your practice depends on how the team works, so spend some time considering the best possible spread of tools and find out how to arrange your dental assistant’s tools more efficiently as well.What will you always need to start the day? Is it likely that you’ll need a dental drill or other infrequent tools next to you at all times? While these may seem like simple questions, they are valid ones to ask at this stage.For example, the tools that are used less frequently may be placed on a specific side of your tray, compared to those that are used consistently, such as inspection mirrors, explorers, and forceps.
Who will you be sharing the workspace space with? It’s important to discuss organization and preparation with your dental assistant to ensure a common understanding of daily tasks and how you might manage your stock.Why? Can you imagine how frustrating it would be to explain where to find the mouth prop, syringe, or even a fresh pair of surgical gloves mid-way through a consultation?Your dental assistant is the person that will be handing tools and supplies to you during a check-up. While that person is the supporting act, he or she (or they) plays a critical role in the seamless delivery of the service, assuming the position of the ‘go to’ person for almost everything.Having in-depth discussions about this to find the best way setup will:
The International Journal of Advanced Health Sciences suggests that four-handed dentistry becomes a common practice to eliminate unnecessary movement during the exchange of dental tools. This is achieved by operating in zones specific to each person to avoid crossover—excess movements—and makes the treatment process more efficient. A quick and effortless dental appointment is sure to put a smile on your client’s face!
If you found a cavity during a consultation, you wouldn’t hesitate to fill it. So, why wouldn’t you do the same with a gap in your dental supplies?Waste no time in thinking you have ‘plenty’ if it is an item that is frequently used daily in your dental practice and doesn’t run the risk of expiring before use. Maintaining a constant stock of materials ensures that you’ll have everything you need on a day-to-day basis. Similarly, your dental assistant should understand the stock-taking requirements correctly, prioritizing more frequent items.Perhaps you may have come across scenarios like these?“I’ve used a lot of gauze today?” There’s a constant reserve readily available for this type of scenario.“We’ve multiple clients booked in for tooth extractions today!” No problem, this was planned for by ensuring a constant stock of Lidocaine and other materials that are required for this procedure.You never know when you might need something—even those infrequently-used items. But also, from a hygiene perspective, items shouldn’t be gathering dust. It’s a prolonged process—a craft even—to create a suitable inventory management system.
With a well-organized dental operatory setup, a standardized approach to daily tasks—that eliminates stress and strain from the consultations—and a set inventory for tools and consumables, the final stage is digitization. Now that the initial processes are in place, you can begin to alleviate menial tasks, such as the procurement of dental supplies, with the help of digital tools specifically designed for dental procurement.The groundwork has been completed in-house, so now, the adoption of a dental inventory management system will enable cost savings for your practice through intuitive price comparison or simply by creating a leaner inventory process.Adopting a solution like Method Procurement means that different stages of the purchasing process are managed through a single, easy-to-use platform that is capable of carrying out multiple tasks for your operatory:
Leveraging Method’s digital procurement solution, dentists can track these processes seamlessly, spending less time on operations management and focusing heavily on quality patient care. The solution is already at work with other practices, tackling inaccurate inventory, reducing shipping costs, minimizing capital held up in inventory, and simplifying the stock-taking process.
Looking to get your teeth into a digital inventory management solution? Method Procurement allows you to access the platform in advance with a Personalized Demo to suit the needs of your dental practice.Arrange now, and you’ll gain better insight into ways streamlined digital procurement can help you simplify repeated tasks while saving on the cost of your dental supplies.
April 4, 2022
Reducing unnecessary costs and overhead is essential for making a dental practice more profitable. As the dental industry grows more competitive, overhead control is more important to your profit margins now than ever before. Running a successful dental practice can be expensive, and every cut expense can make a difference to your profit margin. But how do dentists cut costs?As a dentist, you need to focus on the well-being and health of your patients as well as your practice's bottom line. Fortunately, there are steps you can take to save money, reduce overhead and make your dental practice more cost-efficient.
Improving your dental practice's bottom line means finding ways to save money. Try some of the tips below to save money in your practice:
Within a dental practice, earning revenue and reducing overhead are equally important to sustaining and growing your practice. Follow the tips below to learn more about how you can reduce your dental overhead:
You can go beyond saving money and reducing overhead by making your dental practice more cost-efficient. Follow the tips below to increase the efficiency of your practice:
At Method Procurement, LLC, we combine our passion for software and dentistry to offer a solution tailored to the unique challenges dental practices face. We were founded by a group of technology and dental industry veterans, so we understand exactly how dental procurement works and provide the expertise you can rely on.Our mission is to revolutionize the way dental practices function. We've reimagined end-to-end purchasing to bring it to the digital space and modernized the approach to spend management. Contact us at Method Procurement to learn more about how you can recession-proof a dental practice and stop the back-end cash bleed.
March 28, 2022
From bins and racks to boxes and cabinets, there are many ways to organize supplies in a dental practice. Tip-out bins fill an essential niche, allowing you to store various small- and medium-sized supplies in an easy-to-access, visible location. They're a valuable tool in the hunt for neat and organized dental office storage, allowing you to avoid the costly effects of inventory problems, like lost products and wasted time spent searching for supplies.Let's take a closer look at this useful storage option and how to set it up in your dental practice effectively.
Tip-out bins are an excellent choice for dental supplies, which are often small and need to be contained, not left loose on a shelf. They also have expiration dates, which raises the stakes for staying organized.Commercial tip-out bins are usually made of tough, easy-to-clean plastic bins inside a sturdy frame that attaches to the wall. Rather than sitting on a track like pull-out bins, these simply lean at an angle until the opening is accessible. Employees can access them one-handed and see through the clear sides for inventory visibility — no more wondering if the raspberry fluoride was in the second bin or the third. Plus, they stack up, allowing you to maximize precious floor space.Using these bins as part of a well-organized storage system can help you reap a variety of benefits, including:
So, how do you set up your tip-out bins to get these advantages?
Here's a step-by-step guide to buying and installing tip-out bins for a dental office.
Installing any new organizational system requires commitment. Don't try to switch over a long period. Instead, set aside some time and grab a few helpers to set up your new organization scheme. This could be an excellent time to set everything up if you're closed over the weekend.Be ruthless with your cleaning needs. If you have products you aren't using — throw them away. If you have too hard to find products, now is the best time to invest in the organizational materials you need to make them accessible and deliver value to the business.
Since you're here, you probably already have a decent idea of what you need, but it's time to hammer out the details. A good rule of thumb is to get one section of bins for every treatment room and separate them by the kind of product stored. You may have one section for hygiene, one for ortho and one for other specialties in the office.Other elements to consider when mapping out your dental storage requirements include:
You'll also want to talk to your staff to see what they want from this storage system outside of these technical demands. Ask them what problems they run into and what they'd like to see in the new system. These team members will be using the bins the most and probably have a good idea of what they need to work more efficiently.
After ordering and receiving your bins, you're ready to set them up. The process is usually pretty straightforward, but you'll likely need someone who's handy with tools. Grab someone who knows what they're doing or hire a professional. Remember, these bins can be pretty heavy, so you need to ensure that they won't fall over or damage your walls.The best way to do this is to find studs. Use a studfinder to locate these boards in the walls and use long screws to reach them. If you don't have studs in the walls, use screw anchors. When you place an anchor into the hole before the screw, the anchor expands into the drywall, providing more grip. Check the instructions on your tip-out bins for more information on secure installation and whether anchors are sufficient.If you're installing your bins in new construction, discuss the plan with your contractor. They may be able to install them for you or ensure that wood is in place behind the drywall for more security.
Now comes the fun part — with your bins in place, start moving your items in. Here's where your staff's input especially comes in handy. They can tell you how the items are used and help you select the best placements.Consider organizing your items by which ones are used most often. These are best placed toward the middle of the section, where staff doesn't need to bend down or strain to reach products. Place items that frequently go together in the same area. For instance, if you send each patient home with a toothbrush, mini toothpaste and floss, place these in bins right next to each other for easy access.This is also the time when you'll want to label your bins. Whether you're using stickers, a label maker or barcodes, you'll want to make sure it's easy to identify which items go where. You can even use these as part of a coding system. Use blue labels for ortho tools and green ones for general dentistry, or add a fun sticker to pediatric supplies to separate them from the rest of the items.Your creativity and knowledge of the office will be your best resource for organizing your bins. And remember, this system can be tweaked as you go along. Don't be afraid to reevaluate later on if you think items should be added or moved.
Putting your products in the right place is just the start of neat dental supply room organization. Use this opportunity to start fresh and establish an up-to-date stock list and inventory management system. By determining appropriate stock levels, you have better oversight of your inventory and know when to reorder. You get to avoid running out of items and ensure you're always prepared.With a comprehensive dental inventory system like Method, you can optimize your stock levels by tracking typical use and automatically reordering items when your inventory drops below your defined threshold. We'll talk more about the capabilities of inventory software later, but know that it can be an excellent tool for identifying stock requirements and adding visibility. Reorganization is a great opportunity to add an inventory management platform.
Organizing your tip-out bins for a dental office isn't a one-time event. You'll need to stay on top of the items by scheduling regular cleaning, restocking and counting. If you don't already have a specific point of contact, appoint someone to oversee inventory demands. This person takes responsibility for the job and should understand your system.This person will help carry out regularly scheduled needs, including:
You may choose to restock bins weekly, evaluate inventory movement quarterly, and clean and perform physical inventory yearly. Setting up automatic reordering can eliminate another step, leaving you with a more hands-off inventory system. You can significantly simplify your stock assessments with inventory insights, too, leaving those out of the schedule altogether.
Dental offices have various concerns for effectively managing inventory. You need to keep things profitable, ensure visibility and maintain cleanliness. Here are a few tips to help you meet those needs while you're organizing dental office supplies:
Reorganizing your dental office is the perfect time to implement inventory management software. While tip-out bins can help you physically organize your supplies, software can help you take control of more complex inventory demands and optimize your entire process. Manual inventory management is time-consuming and prone to errors. The right software solution speeds up the process, reduces mistakes and helps you collect valuable insights.Method Procurement is a platform chock full of features to help you optimize your inventory and save time and money. Some of the things you get with Method include:
With Method, you can use your tip-out bins as part of a more capable inventory system to improve the efficiency and profitability of your office.
Using tip-out bins is a must-have for dental offices, helping you keep items front-and-center, where staff members can find what they need and reduce the prevalence of lost or expired products. To boost the effectiveness of your organizational strategy, consider adding Method to it. This inventory management platform was built specifically for dental practices. It can reign in your dental office storage solution to help you save time, money and frustration.To learn more about Method, explore its features online or reach out to us to request a demo!
March 8, 2022
If you're a dentist or dental assistant, you know how crucial good inventory management is, which is why it's important to purchase software that helps rather than hinders you. An inventory management system does just that by allowing you to streamline the digital processes relating to your inventory.For example, Method gives you more time to build your practice by reducing the amount of time you spend managing your inventory. With Method, you can buy supplies for your practice, compile all of your services and products onto one platform, request quotes from multiple suppliers and leave your worry about platform security behind you.Let's look at why spreadsheets aren't the best way to manage inventory and the benefits of using inventory management software like Method.
Up to now, you may have been keeping track of inventory in Microsoft Excel or another online spreadsheet software. While spreadsheet programs are useful for various tasks, they're not the best for inventory management. As your business grows, you'll need a method for tracking inventory that grows with you.With a spreadsheet, you can't get a good idea of your total inventory across all channels. Therefore, you'd have a challenging time planning purchases and forecasting sales. When planning inventory, you need to be able to analyze data at a moment's notice. To analyze data using a spreadsheet, you must update it every day. This can be a challenging task for anyone, let alone someone who's helping run a dental practice.
When you enter data into a spreadsheet, you have a greater chance of making human errors. This is particularly true for users who have to move data from one location to another consistently. When you have to keep track of data manually, it's harder to notice errors or instances of theft. If such issues go unnoticed for long periods of time, they can affect your practice in the long run.Accurate data management is crucial for a dental practice, especially when you need to keep track of the costs of your goods and services and goods and services sold.
Typically, working via spreadsheets is time-consuming because you have to enter data into them manually. Someone in your dental practice will have to take on the responsibility of updating inventory counts. If your inventory is extensive, many people may be tracking and updating your inventory. Although human errors are a natural part of business, spreadsheets make the risk for human error when managing your inventory higher.
When you're using spreadsheets to update your inventory, you create a gap in time between when you sell a product or service and when you record the sale. This gap in time makes it impossible to have an up-to-date inventory. Therefore, you may face issues with understocking and overstocking or selling products that may not be in stock. Don't let spreadsheets derail your practice's plans.
As previously discussed, spreadsheets are error-prone. But how can being error-prone lead to inefficiency? One mistake in updating inventory can lead to your practice purchasing products you don't need and won't use. In turn, you have to deal with managing and offloading extra products instead of other important business related to your dental practice. If your practice has a large inventory, small mistakes can become extensive problems.
Because time is fleeting, it's important to get as much as you can out of your workday. Spending time and labor entering data into spreadsheets that often have to be checked and re-worked is time you could spend improving other areas of your practice.Let's say someone in your office writes data down manually on a piece of paper. Then, someone else inputs that into the computer. Another employee checks the data. If that person finds an error, someone else will spend time redoing parts of the data. This chain of events leads to a lot of time spent on inventory management, which you could reduce by using an inventory management system.
A spreadsheet cell can wear many hats. For example, it can contain the following:
A spreadsheet cell can also function as various things, such as:
Regarding Microsoft Excel specifically, the challenge with cells being able to contain various types of data or function in various ways is that a cell functions as a cell. There's no built-in structure that allows you to represent data as being a part of different categories. Without explicit representation, data is just data, so Microsoft Excel won't ensure that a cell's content matches its intended function.Working with a table with one or two dimensions is more limiting than working with an inventory management system. With Microsoft Excel spreadsheets, you have to work at the level of cells rather than working at the level of a table, which makes it easier for data errors to exist. If you change the formula of one cell, an entire table may become compromised. This cellular error may also be a challenge for you to detect.Microsoft Excel can limit the amount of detail that can be realistically put into a cell or a table. This issue doesn't exist with Method, which ensures you don't have to worry about too much detail complicating the visual structure of a spreadsheet. Microsoft Excel has no link between model and documentation, so it can't prompt you for documentation or help you keep consistency between documentation and model. This may lead to confusion when you're labeling different data and sectioning them into different categories.
Using inventory management systems like Method is simple. But how do they make inventory management easier?
With Method, you can accomplish the following:
If several team members need to sign off on a purchase, Method allows collaboration so everyone knows what's going on from the moment a product is an idea to the moment it's delivered to you. With multiple sets of eyes on your purchases, the amount of incorrect or duplicate purchases you have will decrease.Method allows you to maintain consistency across all your inventory management processes no matter your suppliers. Is your practice spending too much time responding to emails concerning one product you're in the market for? Reduce the time you spend answering said emails by using Method, where you can record receipt cuts, make purchases and compare pricing.The program also allows you to do the following when it comes to spending management:
Of course, saving money as a dental practice is always great, considering the practice's needs can change quickly. Method can help you save on overhead expenses. Did you know overhead methods can cost as much as 66 cents of every dollar your practice makes? That's a considerable chunk of money going toward purchasing supplies and equipment. If you reduce overhead prices, you'll see an increase in profit for your practice.Method helps you cut down on overhead costs by finding more competitive suppliers and comparing the prices for their supplies, equipment and services. It also allows you to take advantage of promotions, discounts and free products. Using an inventory management system allows you to streamline your digital processes and eliminate costs relating to time and labor spent on manually updating inventory.
There are many benefits of using Method for dental inventory management. Let's explore the five benefits below:
Because you're busy helping run a dental practice, you're likely tackling work in many capacities. Method is built with dentists and dental assistants in mind. It'll help you catalog your dental supplies and complete specialized cost analysis with ease so you can spend more time with your patients. This cataloging capability is especially critical when you have a large inventory.
Every dental practice needs supplies, which is why it's essential to have an easy way to order them. With Method, you can efficiently order supplies after little to no training. Once your team finds out how easy it is to order products through Method, they likely won't have any complaints about switching programs. As a result, you don't have to spend time helping them adjust — you can carry on with your daily tasks.
With Method, you'll have the freedom to retain your suppliers and improve your logistics by keeping all of your services and products on one platform. Use Method to manage your practice's current relationships without your suppliers having to join Method. This capability allows you to enjoy the benefits of Method without putting any unnecessary burden on your suppliers.Additionally, Method can compare pricing for specific products. If you can quickly see the best price for your supplies, you have options to switch suppliers and products with ease. Why not get the best price for your products and put your saved money into growing your practice?
At Method, we always want our product to be affordable for you — we don't want you to have to invest large sums of money upfront to purchase inventory software. Instead, we want efficiency and excellent financial results to be accessible for your dental practice, which is why Method features a subscription fee model that has plenty of support, monitoring and training built into it.When you know precisely what and when you'll pay for your software, your chances of paying surprise charges go down while your profits go up.
With Method, you can request quotes from different suppliers while comparing their prices. This way, you can do thorough research to determine which product and supplier work best for your budget. Additionally, you'll have access to any relevant supplier promotions or group purchasing organizations. Keeping track of promotions means you'll never miss out on a discount from any of your suppliers. Therefore, you're always getting the best prices possible. With Method, you can also ensure your suppliers stay honest regarding invoices, shipments and quoted pricing.If you're looking to analyze your practice's buying patterns so you can make them more profitable, Method can help you. It can also help you keep track of contract compliance inside of your team.Overall, Method offers some of the best ways to ensure your practice purchases quality goods from reputable suppliers while staying within your budget.
Here at Method, we've created software built explicitly for your dental practice. Therefore, you can ensure every aspect of Method is suited for your business. Unlike a spreadsheet, Method has numerous features that can help your business thrive.At the end of the day, we want to help you spend less time managing your inventory so you can dedicate more time to your patients. The Method team looks forward to working with you whether you operate at a dentist-owned private practice, mid-sized dental service organization or a large dental service organization.If you want to know more about us and what we can do for you, request a demo or give us a call at 855-917-4540.
February 28, 2022
As a Dental Service Organization (DSO), you require robust infrastructure capable of supporting practice optimization and growth. Whether you’re a midsized or large DSO, procurement software can help you decrease supply costs, curb rogue spending, and increase practice efficiencies while providing the tools you need to leverage volume and maximize your buying power.For many practices, the procurement process continues to rely on manual entry and approvals, numerous online supplier portals and paper catalogs, forms, invoices, and purchase orders. Orders continue to be placed through phone calls, emails, and even fax machines. The process is a cumbersome one that takes your employees away from taking care of patients and dollars out of your profits.These ineffective manual processes have a high rate of error, hamper smart, strategic buying decisions, and are costing DSOs countless dollars and lost opportunity while leaving them vulnerable to fraud and disruption to production.
Standardize automated procurement processes, leverage purchasing volume, implement best practices, mitigate risks, and optimize your profitability- across all locations!Leveraging volume with strategic spend managementIf you’re a large or mature DSO, procurement software provides you the complete visibility and control on all spend across locations you need. So you can go ahead and implement formularies, rest assured that negotiated cost savings will result in real, hard cost savings on your bottom line.Automated, time-saving RFQ processes enable you to quickly and easily compare quotes, select vendors and turn quotes into orders that are then automatically placed with vendors.Procurement managers are empowered to analyze and act without the need to ask for reports and data. Procurement data analytics allow you to analyze purchasing trends and behaviors so you can watch out for anomalies, find synergies and gather the data you need for negotiations.It’s everything you need to drive strategic procurement and maximize opportunity for leveraging volume across sites.Safeguard against fraud and errorBy automating the entirety of the purchase-to-payment lifecycle and implementing best practices such as segregation of duties, you can decrease the probability of error and safeguard against fraud—ensuring you pay the price that was committed to for items received in good order.Streamlined e-procurement for operational efficienciesRequesting and analyzing quotes, identifying requirements, supplier selection, entering order requests, order approvals, receiving shipments, and paying invoices—by streamlining the entirety of the procurement process for employees and providing the dental office with the controls they need for effective centralized procurement,Method delivers operational efficiencies, ensuring your practices remain focused on providing quality patient care while improving profitability through advantageous procurement practices. By helping you to implement standard processes, Method also ensures your purchasing processes and practices remain consistent despite any employee turnover.Fast ROIMethod’s superior user experience designed specifically for dentists ensures quick implementation, high adoption rates, and continued usage across your organization, making for a fast Return On Investment (ROI). The system is so easy to use it requires very minimal training, and Method’s customer success team is right there with you, making sure you’re set up for success and stays with you to ensure growth.By walking in partnership, Method will help guide your procurement transformation as you improve your practice. And as the platform was designed for the industry, and its custom-designed features make for an even faster ROI, it doesn’t come with all the costly unneeded features that are standard with legacy systems, making it an affordable platform for all DSOs, regardless of size.Empower better buying decisionsAn Amazon-like shopping experience means your dental team members can easily order all supplies from one platform and quickly make the best buying decision for your business.Easy to use Amazon-like marketplace brings the dental supply market to your fingertips, so your employees can make the best buying decisions for your organization. And your staff will actually want to use it, as it eases the burden of managing inventory, ordering supplies and faxing a copy of packing slips to HQ. All while being robust enough to be the right enterprise solution for even the largest DSOs.Control spendControlling spend across your organization allows you to drive centralized, procurement, enjoy benefits of scale, more efficient use of resources, implement formularies and drive cost reductions.Method’s approval process allows you to monitor spend against budget, reviewing and approving or declining orders before they occur, across locations. By simplifying collaboration across your team, the approval process helps you to reduce unnecessary, incorrect and duplicate purchases, improving cash flow and mitigating the risk of waste from expired, damaged, or lost items.By monitoring every order against budget and knowing the dollar value of what you have on order and outstanding to pay, you can ensure you stay on track and avoid overspending, all while monitoring orders against budget, and curbing rogue spend.
Improved spend management requires collaborative efforts, full visibility of documents and data. To help you better manage your spend with informed buying decisions, Method guides your purchasing process, allowing you to easily view the insights and details you need.Keeping you connected to your team, suppliers, financial systems, and the dental community to efficiently procure all of your practice needs, Method offers full transparency, so everyone stays in the loop and no requests are lost or forgotten.Rapid RequestQuickly and easily create new requests from prior orders, inventory, or catalogs. Method auto-fills product details to minimize manual entries and save time.CollaborationAnnotate requests using notes and attachments, both internally with your team and externally with suppliers.Linked DocumentsView all of the documents related to a request, including orders, receipts, invoices, and payments.Complete VisibilityTrack the status of all requests from a common screen to see what has been approved and ordered.History LogReview an audit trail of each request from beginning to end to see the full story behind every purchase.DraftsSave in-process requests while details are finalized before submitting them to your team for approval.
Method Procurement gives dental practices and DSOs the spend management capabilities they need to run an effective practice, so they can scale, profitably.With our full, end-to-end inventory and order management, and a superior user experience, ordering dental supplies is straightforward and hassle-free, ensuring continued usage throughout your organization- so you can gain control of spend and leverage your purchasing volumes for realized cost savings and improved profits.Ready to start saving?Learn how Method Procurement's spend management solutions can improve your bottom line. Get in touch with our team today or request a demo to see it for yourself.
February 21, 2022
Internal theft — also known as employee theft — occurs when an employee commits fraud or steals from their employer and practice. In the dental industry, opportunities for fraud result from a lack of internal controls and supervision, failure to prescreen employees and individual employees having too much control over accounting. Internal theft can come in many forms, such as cash theft, falsifying expense accounts or payroll, check fraud and unauthorized fund usage.With so many means of theft, employees can easily conceal inflated expenses if you don't regularly monitor these figures or your staff. Most dental practices are quite busy, and it can be easy to lose track of unauthorized transactions. An inventory management software can help you manage your internal controls, provide risk management processes, prevent theft and improve workflow efficiencies.
Embezzlement — a form of internal theft — within dental practices is not uncommon. According to the American Dental Association (ADA), one survey found nearly 46% of respondents said their dental practice experienced theft or embezzlement more than once.Here are some internal controls you can implement to prevent this theft in your dental practice.
Your dental practice manages and shares confidential data such as insurance claims and checking account information. If not implemented already, every employee should undergo background checks that include criminal, educational and credit information. When bringing on new hires, you should also check any references, specifically from previous employers.While it might be commonplace to overlook these essential procedures, it's important you check all employee records. Even if a potential hire wouldn't directly handle financial or confidential information, you may promote them to those duties in the future.
While you are busy with endless tasks in your practice, your employees are responsible for daily transactions, deposits and other day-to-day operations. Create an accounting manual that describes each employee's responsibilities and have them sign off as they complete their daily and weekly tasks. You can check these numbers and tasks align with your expenses to help keep track of them.As the practice owner, ensure you fully understand your accounting software, can navigate it as easily as your employees and double-check all processes. You can purchase a software system that includes inventory management, order controls, reports and cash flow visibility.
Fraud and theft are easier to hide when one person handles multiple tasks or steps at once. Segregating your duties among several employees ensures no individual controls the entire financial process.With purchase management software, you can view and control these transactions and easily identify which employees had access to specific controls. You can also delegate tasks that two or more employees must complete, ensuring they check each other's work.Review completed work regularly to hold employees accountable if you or other employees catch any errors.
Preventing internal theft starts with assessing your current processes and how you can improve them. Every dental practice should use time clocks and manual entries the doctor must initial or inspect. Receipts and cash should have the same balance every day, and thorough documentation — such as date, time and employee initial — should be logged with all transactions.For theft to occur in any form, there must be a:
Preventing theft is easier to do when you remove any opportunity to do so. Some of these tips for controlling financial access can help make your practice more secure:
Software reports are designed to assist in avoiding theft problems. However, if you do not review these reports, it becomes even harder to spot incorrect charges. Your software should provide complete visibility, linked payments and approval and decline features. This way, your staff will not be able to delete or conceal their actions regarding your expenses and account management processes.
Aside from general internal controls, you can also implement employee and accounting controls in your dental practice. These controls will help you look out for suspicious behavior or unusual occurrences that may result from embezzlement or fraud.
As a dental practice owner, it's easy to focus most of your attention on patient care, but it's just as essential to devote some time in your day to oversee other operations. Long-term employees may be more likely to commit theft or fraud because they are more familiar with the financial process of the practice. These employees may be the ones who oversee accounts receivable, accounts payable and other banking aspects.You should monitor for certain behaviors, including employees who:
Reviewing your bookkeeping and accounting system can reduce the probability of employee theft. Tracking these financial aspects regularly also alerts employees that you are closely paying attention, which may discourage them from attempting theft. Some of these accounting and spending controls include:
It can be challenging to handle all of your dental practice's needs at once. With Method, we make it easy for you and your employees to manage and reorder supplies, gain visibility, create an approval process and drive results that can improve your bottom line. Method's system has built-in controls to help prevent theft, manage cash flow and stop the back-end cash bleed.Our software is built specifically for dental practices for full, end-to-end inventory management to help you set dental office controls and keep your practice secure. Call us today at 1-800-742-2100 or request a demo online to learn more about the solutions we offer.
February 14, 2022
Find yourself confused about all the hype around Artificial Intelligence (AI)? You may be missing out on opportunities to increase revenue and improve profits.Although terms such as AI, Big Data, and Data Management are widely used, they can be hard to discern and even harder to understand the relevance to your dental business. But in today's challenging business environment, as dental practice owners continue to fight for profitability, it's essential to know how AI can improve profits. Luckily for you, we're here to help.Read until the end, and you'll walk away with not only a better understanding of AI but how you can implement AI into your dental practice to increase revenue through qualified leads and improve profits through streamlined, digitized procurement.Now, let's get to the good stuff.
AI: Artificial Intelligence. For many of us, the term still conjures up movies starring Will Smith, or, depending on your vintage, maybe even Keanu Reeves. But the once seemingly out of this world tech is now out of its infancy and has reached the mainstream. Although it's not quite yet at the level depicted in movies, it is helping companies everywhere leverage business intelligence to drive results-oriented decision-making.Before moving on to what it can do for you, let's clarify what exactly AI is.Essentially, AI is computers mimicking human intelligence. Or, as Forbes so perfectly states, "In the most simplistic terms, AI is the computer simulation of human intelligence in machines that is programmed to think like humans and mimic human actions. A typical AI analyzes its environment and takes actions that maximize its chance of success."But if all it does is think like humans, then why not just have humans do the thinking? Well, because the aptly named tech can perform analysis at a level and speed not capable of humans.
Sounds great, but how exactly does any of this lead to optimizing revenue and profits for your dental practice? Although you spend most of your time and efforts running the day-to-day of your dental practice and ensuring your patients receive the highest level of service you can provide, your practice is still a business.Scaling that business profitably not only requires reaching your "audience" (clients and potential clients) in perhaps new, more effective ways but implementing the kind of best practices and streamlined workflows that allow for an efficiently run dental practice. Let's take a look at how AI can help you do just that.
If you're looking to scale, offer more services, or even better serve your clients, AI can help.Although you may not realize it, your dental practice generates a lot of data. AI helps you better aggregate, analyze and use that data so you can work smarter, not harder, and better serve your customers while improving efficiencies.
By training AI to meet your needs, you can streamline your workflow by using voice commands to retrieve what you need while you continue to multitask and take care of your patient. For example, instead of having your employees hunt for the image you need, you can use voice commands, and AI-enhanced imaging machines will immediately provide you with exactly what you're looking for. Need to see that last X-ray? Just say, "Show me the last X-ray for patient X."When deployed along with machine learning (a subset of AI where the machines learn to learn), AI can be used to identify patterns and predict possible occurrences like diseases, lesions, or infections. At the front end of the house, AI can help you send patient reminders and book appointments while your staff stays busy taking care of the patients you have in-house.
The success of your dental practice is heavily dependent on how effectively it is run, but dentists are often busy taking care of patients and aren't necessarily innately business-minded. AI-based dental software such as Method Technologies can assist you in implementing streamlined processes and drive better business making by leveraging data.Method's data-focused analytics provide the information you need to navigate the many challenges that beset your operation. AI-driven dental practice analytics can help you gain a more accurate idea of how you're doing and identify opportunities for improvement.
How often your patients come in for services, what patients are electing for higher-cost services, where they live, and who they are— you're likely sitting on a goldmine of data that could help you level up your practice. Perhaps there are new services you could be providing or a new patient base you could be targeting. Or maybe you want your practice to spend more time doing certain high-value procedures?AI can help you track and analyze practice data that can be utilized to drive more targeted and effective marketing campaigns so you can gain high-value patients and scale strategically. If you're looking to place automated placement ads, AI can ensure you're using the right platforms to attract the type of business and patients you want.If used to its potential, AI has the power to transform your dental practice and reach your growth targets by identifying new prospective patients consistent with the traits you're looking for. This allows you to run laser-focused ads that offer deals or bring attention to services you're looking to grow.
From ordering your favorite pizza to walking you through a complex B2B purchase, chatbots are at the frontlines of AI. Empowered with natural language processing (the ability to analyze and generate human speech), chatbots automatically engage and respond to received messages. They can be built to respond based on keywords received and can continue to respond the same way each time, or, with machine learning, they can adapt their response to fit a unique situation.Each and every day, your front office staff receive a lot of inquiries they must quickly respond to, whether it be through your website or social media channels. Although answering inquiries is imperative to maintaining service levels and growth, this can be time-consuming and takes your dental staff's attention away from their other tasks. Luckily, you can now program chatbots to assist with your day-to-day communication with new and existing patients.Although traditional chatbots build leads and nurture sales prospects and can understand a set of pre-programmed commands, thanks to their machine learning, they can continue to improve based on inputs. So as they experience new situations, the smarter they get, and the better they respond to a patient's specific needs. This makes them well suited for a wide range of uses, including being able to analyze sentiment and predict what website visitors are looking for.For example, if a patient logs onto your website and sends a message inquiring about tooth extraction, your chatbot can reply with pricing as well as describe the service and process. Best yet, it can then prompt the potential patient to either ask further questions or go ahead and book an appointment.Also, unlike an employee, the software is programmed to respond immediately and can handle more than one inquiry at a time. So, not only does using a dental chatbot alleviate your employees, but it quickens your response time and can lead to more bookings!
Coupled with automation, AI can help increase efficiencies through streamlined workflows, delivering reduced labor costs and higher accuracy rates while your employees focus on providing optimal patient care.Automation such as Method's ability to quickly turn Request For Quotes (RFQs) into order requests and Purchase Orders (POs) can help save valuable time while reducing the types of human errors that could damage your profitability. Features such as predictive text can help speed up tasks that remain manual.Workflows that involve different departments or employees often stagnate. AI can help keep the work flowing with push notifications and reminders. Approval processes can be monitored electronically to ensure adherence to company practice.Best practices such as the three-way-match process, segregation of duties, and monitoring spend against budget can be easily implemented and automated, safeguarding your practice from harm and keeping an eye on its dollars.AI can also help make light work of ensuring regulatory compliance, validating documentation and monitoring for expiry dates, and providing warnings before documents expire.Key Performance Indicators (KPIs) are a valuable tool in monitoring the performance of your dental practice. However, they often go underutilized as dental practitioners or their employees simply do not have the time or ability to monitor progress. AI can help, allowing you to effortlessly monitor the areas of your business that are vital to your long-term objectives, ensuring you stay on track and meet your goals.
When it comes to the purchasing of your dental supplies and services, AI can empower critical decision-making and provide you with the data you need to level up to more strategic procurement.
Today, AI is providing dental practices with an opportunity to better target their patients, improve processes and profit margins and deliver more personalized patient experiences, and all with scalability.If you're looking for growth, AI may be your secret weapon, allowing you to move away from a reactive mode where all efforts are spent fighting fires and dealing with the day-to-day of servicing clients. Instead, leverage AI to get to the root of the problems and stop them from reoccurring so you— and your employees— can move on to more forward-facing actions.You'll want to avoid implementing AI simply because it's trendy. First, take a few moments to ask a few important questions before gearing up for AI:
Lastly, it's important to know your business priorities and be realistic when it comes to implementing new technologies. Make sure you align yourself with the right partners who understand the realities of your dental practice and will be "hands-on" when it comes to implementation and training. The last thing you want is someone who passes you a manual and leaves you to be on your merry way.If improving profits is one of your business priorities, then Method Procurement Technologies can help get you there. Our AI analytics can help you buy smarter and faster, so you can scale profitably. See how Method Works.Ready for a Demo? Request a Personalized Demo That Suits Your Dental Practice's Needs.
January 25, 2022
According to the American Medical Association, almost a third of physicians spend 20 or more hours per week on paperwork and administrative tasks. If you're spending too much time on tasks such as ordering supplies and managing inventory, an online ordering system can help. Ordering dental supplies online is easier, faster and less stressful than playing phone tag with distributors or waiting to meet with a sales rep. A cloud-based tool like Method Procurement reduces the time and effort it takes to keep essentials in stock, so you can focus on your patients and improving your bottom line.As an end-to-end inventory management solution designed exclusively for dental practices and dental support organizations, Method allows you to:
If you're concerned about implementation, know that we'll help you every step of the way. Reach out to our team today to learn more or request a demo and discover how Method works.
Chapter 4: How Do You Save Money on Dental Supplies?
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January 12, 2022
When you need to order dental supplies, do you call up a trusted supplier or browse the internet for the best deals? Today's dentists face many ways to restock supplies, and they no longer have to depend on sales representatives to get what they need.For instance, dentists can easily order just about anything online, including the bulk of their dental supplies, and many are taking advantage of this option. According to IBISWorld, the online medical supply industry generated $5 billion in 2020, and analysts anticipate more health care providers will shift to e-commerce in the coming years.Buying dental supplies over the internet can be a simple way to restock the essentials, and it allows you to order what you need 24/7 from anywhere. Also, when you order supplies online, you can easily comparison-shop to keep overhead as low as possible and access detailed product information on a single platform.Here's the tricky part — you'll find countless vendors selling dental supplies if you start with a search engine. So, how do you find suppliers you can trust? And is it possible to save money on orders without sacrificing quality? Keep reading to find out.
Chapter 1: Where Do You Buy Dental Supplies?
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January 12, 2022
While you may not think about shopping for X-ray holders when you're filling cavities, your supplies are necessary to your practice. If you keep your office well-stocked with supplies from reputable manufacturers, you can keep your patients smiling and feeling confident in your work.
Before we get into the basics of buying supplies, let's consider what the term "supply" refers to. The American Dental Association's Center for Professional Success defines dental supplies as "items priced less than $500 per item." Anything above $500 is considered equipment.Examples of basic supplies include instruments, disposables, infection control products, personal protective equipment, composites and impression materials — all of which you can order online or through a sales representative. Depending on where you go to buy your supplies, you may be able to order everything in one visit.This chapter shows you where you can purchase dental supplies, things to consider when selecting a supplier and tips for selecting time-saving purchasing software.
Traditionally, dental offices purchase supplies from distributors or dealers by contacting a sales representative. Some dealers have walk-in reps who will go into your office and promote their products. One advantage of working with a walk-in rep is they can answer your questions and make recommendations. On the downside, meeting reps during the workday can take time away from your patients. Also, not all sales representatives are eager to help you make the best choices.Other dealers have dedicated telesales account managers or non-dedicated customer service representatives through whom you can order supplies. Finally, some dealers only allow you to order supplies online.You may also obtain what you need directly from a manufacturer if the company allows it. To go this route, visit the manufacturer's or distributor's website and see what products are available to purchase online. Typically, you'll need to create an online account before you can see the product's total price and place an order. Once you have accounts with the different suppliers you're interested in, you can jump between each one's website to compare prices and find the best deal.If searching for supplies online or calling sales reps sounds too time-consuming, you can use software instead, which will do most of the work for you. Dental supply purchasing software lets you order supplies from a comprehensive catalog or any supplier you wish to work with.For example, procurement software like Method allows you to compare prices and place orders from multiple suppliers on a single platform, so you don't have to waste time surfing the web. If you've already built a relationship with a supplier, you can invite them to communicate with you through the platform so that you can stay organized and on top of your orders.
If you hop online to shop for books or T-shirts, you could spend days wading through suppliers. Search for dental supplies online, and you'll also be inundated with options — and some are not so trustworthy.How do you narrow your options and keep your sanity at the same time? It takes research and maybe a cup of coffee to know who you can trust for top-quality dental supplies. You'll want to consider the following factors when deciding where to buy supplies for your dental practice:
If you're not sure where to begin your search for a supplier, we'll help you get started. Here are four of the industry's top names:
Have you found a few dependable suppliers? If so, here are general tips to help you buy quality supplies while sticking to your budget:
Comparing prices between websites and researching manufacturers might not be at the top of your to-do list. After all, you have patients to care for, and you probably would like to go home at some point, too. Here's the good news — you can use software to simplify the process and maintain a work-life balance.Dental supply procurement software reduces the time it takes to research products and compare prices because it keeps everything in one place. Procurement software can also help you manage inventory efficiently, so you can always have what you need and avoid ordering excess items.To choose an online tool for buying dental supplies, such as cloud-based purchasing software, look for the following features:
Even though shopping online for dental supplies has its perks — like 24/7 access — it can be time-consuming without purchasing software. Procurement software makes it quick and easy to comparison-shop whenever it's convenient for you or your staff. Here are more benefits to using purchasing software:
At Method, we understand that finding the best dental supplies at the right price can be challenging. Our software streamlines the process and helps ensure you're getting the supplies you need at the prices you want. Request your demo today to see how our Method is your success.
The Ultimate Guide to Buying Dental SuppliesChapter 2: How Do You Compare Dental Supply Prices?
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January 12, 2022
According to Pediatric Dentistry Today, about 4% to 6% of a dental office's revenue goes towards dental supplies — in other words, if an office generates $1 million in revenue, $40,000 to $60,000 will go towards dental supplies. This number may be lower or higher depending on a practice's purchasing behaviors. For example, a dental practice might spend much more than 6% of revenue on supplies if it doesn't establish a budget and stick to it. By contrast, a practice can reach its overhead goals if it keeps an accurate inventory count, comparison shops and only orders what it needs.What can you do if you're spending too much on dental supplies? Creating a budget is the first step to gaining control of your spending. This chapter explores how to budget for the essentials and includes the average cost of basic dental supplies so you know where to start.If you already set your budget and want to find the best prices on dental supplies quickly, Method can help you save more in less time.
Dental supply prices vary greatly depending on the brand, style and material used. Product costs also differ depending on the supplier and the deals they offer. If you order dental supplies online, you'll face a wide range of prices.To show you what to expect, here's a list of basic supplies and their typical costs:
Your practice does not have to settle for cheap dental supplies to keep overhead low. By creating and following a budget, you can be sure you have enough money for the most important items. Here are steps to creating a budget for supplies:
If you already have a budget, compare it to how much you're actually spending every month. If the numbers match, you're on the right track. If they don't, it's time to cut some costs.
Did your budget reveal overspending? Dental supplies can easily cost more if you don't have the appropriate controls in place. Here's what you can do to increase the visibility of all your dental supply purchases:
Chapter 2: How Do You Compare Dental Supply Prices?Chapter 4: How Do You Save Money on Dental Supplies?
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January 12, 2022
Comparison shopping involves comparing features, costs, benefits and risks of similar products from one or more suppliers. It enables you to make informed buying decisions and can help you save big over the long run.
How much can you save? Financial experts claim that comparison shopping can help you save up to 50% on the items you want to buy. In other words, if you're spending thousands of dollars on supplies each year, comparison shopping can make a significant difference on your bottom line.But will it take too much time? It doesn't have to. This chapter provides tips for comparing dental supply prices online, so you can get the best deals possible and still have time for your patients.
In the dental industry, comparison shopping shows you how costs vary from one vendor to the next. This helps you ensure you're getting a good price. One way to compare deals is to list all the suppliers you want to buy from, visit each one's website, find the products you want, jot down the prices and compare.Does that sound like a lot of work? That's because it is. The above strategy can be time-consuming and challenging, particularly if the suppliers do not list their prices. Instead of creating lists with pen and paper, you can use digital tools to compare prices quickly and easily.For example, you can use purchasing software designed for the dental industry, like Method. With Method, you can request quotes from a curated list of distributors or incorporate your current suppliers. After the suppliers respond, Method performs an automatic cost analysis to show you the best deals. You can then order the items in the same easy-to-use platform, even if you're buying from multiple suppliers at once. This means you don't have to spend time browsing the web or ordering supplies from various websites.Since dental supply prices can increase over time, comparison shopping is not a one-time job. Consider how almost a third of dentists claim that personal protective equipment prices tripled in 2020. For the most savings, you'll want to comparison-shop every time you're ready to order more supplies — another reason to use purchasing software. Purchasing software will come in handy whenever you need to find the best prices.
No matter what strategy you use to comparison shop, here are a few tips to maximize the process:
Comparison shopping is not just about saving money. When you compare prices on dental supplies, you'll gain the following:
To learn more about Method Procurement software and how it can help you compare prices, save money and increase efficiency, contact our team today.
Chapter 1: Where Do You Buy Dental Supplies?Chapter 3: How Much Do Dental Supplies Cost?
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January 12, 2022
You already know that quality supplies are a fundamental part of any well-run dental practice. But, even though you need to spend money on supplies to care for your patients, you don't need to spend more than is necessary. You can save money on supplies without giving up quality.This chapter covers tips for saving money on supply purchases and recommends ways to maintain your stock. If you need an efficient online tool for comparing prices and ordering dental supplies, let us know.
The national average overhead for dental offices is around 65%. So, if an office collects $1 million a year, $650,000 goes toward overhead costs. Ideally, a dental practice will spend 4% to 6% of its overhead on supplies. For an office that spends $650,000 on overhead, that comes out to be $26,000 to $39,000 a year.Many dental practices don't meet the ideal benchmark. According to an Aldrich report, the average single dental practice spends 7.2% of collections on supplies. For a practice making $1 million, that's $72,000 on supplies — and that's more than it needs to be.
If your office spends more than 6% of revenue on supplies, it's time to think about ways to save. Saving on supplies puts real money back into your pocket so you can invest in other things, like a well-earned vacation.Here are tips to help you save on dental supplies and stay within that 4% to 6% range:
Employee wages are the largest expense in a dental office and typically take up 18% to 24% of a practice's annual income. One way to decrease your practice's labor costs is to implement an efficient procurement process.With a streamlined purchasing system in place, employees will spend less time ordering and receiving supplies. This means you won't have to pay overtime or add more hours to an employee's schedule when you need to restock. Add an easy-to-use inventory management system to the picture, and you'll decrease duplicate orders and time wasted maintaining excess stock.An efficient and simple purchasing process can also keep you from having to hire more staff. And, it'll be easy to cross-train the employees you already have on different purchasing tasks.
Dental supplies are just a fraction of the costs required to run a successful dental practice. It's essential to understand all of your overhead expenses and create a budget your entire team can stick to.What is a dental office budget? A budget is a plan that will help you manage your practice's finances. It involves setting goals and tracking your spending to ensure you make a profit that you're happy with.To create a budget for your office, take these steps:
The first step to creating any budget is to know where you currently stand. Gather your past year's financial records and list every operating expenditure, including money spent on supplies and rent.
Add up all of last year's expenses and compare the total to your revenue. For example, if your office spent $600,000 on operating expenses and generated $900,000, your office has an overhead cost of about 67%.
Compare your overhead to the national average to see how well your practice is doing. A healthy operation should have an overhead of 65% or less.You can use the following benchmarks provided by Pediatric Dentistry Today to compare individual percentages:
How does your practice compare to the recommended benchmarks? If you found some problem areas, you can set a new percentage as a goal. For example, if you discovered that 9% of your overhead went to supplies, you might set a goal to spend no more than 7% of overhead on supplies.
Look at your list of expenses and think about costs you can cut to reach your new goal, whether you're trying to reduce your overall overhead or an individual expense. If you're trying to reduce supply costs, look at your inventory and purchasing records and consider where you can decrease spending.
Periodically look at your budget and see if you're moving toward your goal, and make adjustments as needed. Be sure to get your team involved and ask for their feedback. Your staff could cause you to re-think cutting back on certain expenses or help you find areas you can cut that you overlooked.
The point of any budget is to stick to it — if you want to see results. This means fighting the urge to buy unnecessary supplies, equipment or services. Depending on your goals and needs, it may also mean resisting hiring more staff.Another vital part of adhering to your budget is your commitment to tracking spending. Talk to your staff about the importance of keeping complete records so everyone's on the same page. Method's software can help you and your employees stick to your budget and meet your target with inventory management and procurement capabilities.
Properly storing and maintaining your supplies is crucial to reducing waste and staying within your supply budget. A clean, well-organized supply closet also allows staff to work more efficiently, which can help you save on labor costs. Also, when employees work faster and better, you'll keep patients beaming and more likely to return.Follow these tips to keep your supplies in top shape:
Chapter 3: How Much Do Dental Supplies Cost?Conclusion: Let Our Method Do the Work
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January 12, 2022
You have a list of the supplies you need to replenish your dental practice storage. You know some vendors or manufacturers who you can buy from. Your next step is to reach out to them, place your order and try to negotiate for a great price. So how do you negotiate the best price for your next and future dental supplies purchase for your practice?Learn how to negotiate pricing with suppliers and what you can do to get the best deal for your next dental supply purchase with this guide!
Yes, you can. You can purchase your next dental supplies at a lower rate than you used to and pay less than you do now for gloves, anesthesia, crowns, and other dental supplies.However, it doesn't end with dental supplies. Whether you're buying from a vendor or from the manufacturer, you can also negotiate better pricing for dental equipment.
Here are four benefits of negotiating pricing with dental supply manufacturers:
Especially if your dental practice is new, you don't want to spend more than your practice earns.Apart from paying your staff, paying rent, and paying for the technology you use to run your dental practice, supply purchase is another area of your practice where a heavy outlay of cash hurts your cash flow and your profits. Negotiating pricing with your supply manufacturers can help you stop back-end cash bleed, ensure you run a lean budget, and help you save on hard and soft costs.
Reducing your expenses improves your bottom-line and profitability.Here's the interesting part about cutting down on your back-end cash bleed. Unlike revenue, any amount you save from spending on supply purchases goes straight to your bottom line.Except for heavy equipment, you generally purchase supplies every month. This means you can set your practice up for wider profit margins month-over-month by cutting down on the cost of purchasing supplies.For example, if you apply the tactics we explain in the next section to your supplier negotiation process and saving $2,000 per month in dental supplies purchases for the next 12 months would be $24,000 in savings in a year. Imagine what that extra money every year can do for your practice.
Negotiating for better pricing with dental supply manufacturers helps you reduce your cost of operation and secure more cash for other aspects of your practice.For example, you can direct the thousands of dollars you save per year from negotiating better deals for your dental supplies toward paying your staff and implementing your growth plan.
Developing the habit of looking for the best deals for your practice helps improve the quality of your spending month-over-month.How does this help your practice? Improved spend management reduces wastage and misuse of funds and ensures every dollar spent is spent well.
As you'll discover, negotiating prices for your dental supplies is similar to how you'd negotiate for a better deal when buying a new house, a piece of new furniture, or a new car. Here are 10 strategies to negotiate the best deals for your next dental supplies purchase.
Start by searching for multiple vendors for the supplies you need to purchase for your practice. Ensure you select at least three vendors.You can get in contact with more vendors through a quick search on the internet. You can also get referrals from other dentists or orthodontists in your professional network. You can even source dental supply vendors easily through a purchasing platform. Just remember if you do choose to rely on an internet search, do your homework and ensure you're dealing with a reputable vendor.Sourcing multiple vendors provides you with different price points to choose from and helps you compare prices between vendors. Having different options helps you build a sense of competition among vendors to cut down prices and get the best deal for your purchase.On the other hand, reaching out to only one vendor will not give you enough bargaining power to get the best deal. Speaking to one vendor reduces your options and blinds you to better prices you can get from other vendors, and puts the vendor in the driver's seat.
For each item on your list, gather information about their market prices. There are different ways you can gather pricing information on your supplies purchase:
Gathering enough pricing information helps you create a budget for your supply purchase. It also helps you understand the price ranges for the supplies you want to purchase, letting you find the best position to negotiate prices and ask for a better deal with vendors and manufacturers.
Reach out to all the vendors on your list and request quotes or proposals. You can do this through Method.Here's how you can build up negotiating power while requesting quotes. First, in your request for proposals, ensure each vendor knows you're also reaching out to and receiving proposals from other vendors, and you'd be going with the vendor that offers the most competitive offer.If they know that they're not the only ones you're talking to, and you may have other options, they may provide competitive pricing in their quotes to try to gain your business.
When you receive the proposals from the vendors or manufacturers, evaluate the prices of each dental supply on a per-item basis. In the quote section of Method, you can easily compare the prices offered by different vendors.How will this help you get a better deal for your purchase?Consider this example. A box of dental probes can contain different brands and kinds of probes with different individual prices. So evaluating the price on a per-item basis can help you uncover opportunities to cut expenses compared to looking at it as a box.Drilling down to the per-item price may help you uncover additional accessories, features, or services included in your purchase that you may not need.Extend this to every supply you want to purchase, and you can discover a lot of opportunities to cut costs.
Most dental practices accept the first proposals sent to them as the final proposal.When you accept the first offer sent to you, you leave a lot of money on the table and miss out on opportunities to get a better price for your purchase. Instead, follow these steps:
when putting together your counteroffers and asking for a discount for your purchase.This is where all the information you've gathered on the items you want to purchase will become very useful. You may need to have some frank discussions and provide some transparency on where suppliers stand and what they need to do to gain and retain your business.Request discounts from the vendors on your list on a per-item basis and again, ensure they know you're also receiving offers from and are in buying discussions with other vendors.
Vendors and manufacturers want to clear their shelves and sell off their products faster.Positioning your practice as a source of large-volume purchases or future sales can increase your chances of getting a good deal and increase your bargaining power. This is because vendors would not want to lose business to their competitors and would be more open to lowering their price points to keep your account.Here's something else you can do to increase your bargaining power and improve your chances of getting a discount from a vendor. You can promise to purchase all your supplies from the vendor instead of spreading your purchases across different vendors.If you're a new practice and do not currently order a large volume of supplies, you can show vendors your growth projection for the next few years and how much your demand for their products will increase. This will show them your long-term value to their business. With this, they'd view giving you a discount as an investment for more sales in the future.You can also offer to transport the products yourself for a discount. And, if you're a member of a large network of dentists, you can offer to promote the vendor in your network if they provide a better deal for your purchase.Consider displaying attributes that will make vendors do all they can to get more of your business, as well. For example, paying higher deposits, paying on time, and providing referrals and honest reviews for vendors can position your practice as a customer of choice. This increases your chances of getting a better deal from vendors.
Sometimes, you will succeed in getting a price discount for the dental supplies you want to purchase. Other times, vendors may be set on their price. When this happens, you can take your supplier negotiation to the next level.For example, you can negotiate better deals on shipping fees for an increased volume of supplies. You can also ask for faster shipping without paying more, longer warranties for your supplies, or less upfront payment when there is no price reduction or extended payment terms to help ease your cash flow.Another option is to try and negotiate a volume discount or recurring purchase discount. For example, if you commit to reordering from the supplier every quarter, see if it will offer you a discount on your purchase. With Method, you can track your inventory and determine what reordering schedule will work best for your practice.
Whether the negotiation process is over the phone, via email on a dental inventory, or through a procurement platform, always communicate with vendors politely.Ensure you present your requests in a conversational tone and request and share information with vendors in a polite manner. When vendors see that you're courteous, they may be more willing to listen to your requests for a better price. They'll also feel more eager to work with you again in the future, meaning they may be more encouraged to lower prices now.
While it can be tempting to try and negotiate a lower price on a product or service by claiming that another supplier is offering the same for less, resist the temptation. Trying to pit suppliers against each other based on price is considered unfair and bad business practice.If you want a lower price from a supplier, ask for it plainly and simply. If the supplier can't agree to the price you want, look to other suppliers to see what they can do for you.
The first step to negotiating prices for your dental supplies is reaching out to multiple vendors, and Method helps you source for vendors, see costs and negotiate prices in one place.As an end-to-end dental inventory and purchasing platform, Method makes it very easy for you to:
Kick-off your next dental supply purchase process with Method to enjoy significant product price reduction and improve your bottom line.Contact us today at 1-800-742-2100 to discuss your purchasing needs and request a demo to see how Method can help you source vendors and buy dental supplies at the most competitive prices.
December 28, 2021
Whether you’re new to buying dental supplies or have been working with the same suppliers for years, the internet poses an excellent opportunity to shop for savings. Yet, even today, with so many convenient modes of communication available, you shouldn’t be surprised to find a sales rep at your door. And of course, they come armed with a great sales pitch, make sure to get to know you and your staff and make ordering easy on you. Although perhaps not cheaply.For busy office staff, the temptation to take the path of least resistance may be hard to resist. But should you? Can you really save time and money by ordering online? We’ll help you decide what’s right for you by walking you through the challenges of managing dental supplies, the disadvantages of working with a sales rep, and what you may have to gain by ordering online. So keep reading to figure out if it’s time to make the switch to internet buying.
From cotton balls to patient bibs and Kn95 masks, the list of supplies you need to run your dental practice is a long and technical one. Ensuring you have what you need when you need it and at the right quality is imperative to optimal client care and maximizing production rates.On the other hand, ensuring you buy no more than what you need and controlling the cost of dental supplies is critical to profitability and maintaining the cash flow you need to support growth.In a busy dental office where staff can easily misplace things as their focus tends to be on servicing patients, knowing what you have on hand and, therefore, when you need to order can be, well, not easy. Also, lead time can vary by vendor and by item, making it even harder to make sure you order on time and avoid the extra costs of rushed shipments.With no systematic way for managing supplies and consolidating orders, your staff is often left in reactionary mode, ordering whatever they just realized they might run out of at the last minute. This can cause administrative costs to skyrocket as each order needs to be placed, monitored, received, and paid for separately. You may also incur additional expediting costs.Requesting and managing multiple quotes for that long list of items through emails, phone calls, and supplier visits is overly cumbersome and makes comparing pricing time-consuming and difficult. And, of course, pricing never remains stagnant. Monitoring price changes to ensure you aren’t being gouged and are paying no more than you should is another essential task that often falls by the wayside for more pressing matters. Meanwhile, your profits suffer.
Your dental supply rep works for the company they represent and is there to make them money. Although they aren’t likely to say so, it is their job to look out for their own and their own best interests; your employees need to ensure they look out for yours.We know how it goes. They say they are there to support you and care about what is best for your dental practice. They may even try and win your business by offering “free” perks such as lunches, gift bags, gift cards, or even golfing trips and movie vouchers. It’s a common way for sales reps to buy goodwill and establish a relationship. They’ll even spend time getting to know your practice and your employees. This helps them to build trust.Unfortunately, this trust is then exploited to sell you what they want at the price they want. Sales reps, and the companies they work for, know the industry well. They understand just how busy dental assistants are. They also know how difficult it has historically been to properly manage the sourcing and purchasing of supplies, hygiene products, and dental equipment. Just getting your eyes on competitive pricing for your long list of supply requirements can be a challenge. It’s why they become a one-stop-shop and make it easy for you to rely on them for all your needs.It’s important to remember that all perks come at a cost, and those costs are built into your prices. Unfortunately, they also tend to put you at a disadvantage, leaving the sales rep in the driver’s seat and your employees’ bias. It’s a common trick of the trade for a good reason. It works to their full advantage.However, a wide variety of brands on the market may be offering superior products and much more competitive pricing. So, by coming to you, they may be preventing you from seeing what you are missing out on- which is precisely the point.It’s important to take a moment to think about how they are genuinely helping you. What are they bringing to the table, and are there now faster, better ways of doing things that may save you money?
If you’re tieing your practice solely to one supplier or buying from whichever rep walks in your door, you’re likely spending too much money on dental supplies and putting your company at risk. Although there was once little option, the powers of deep tech such as AI, big data, and cloud-based software have transformed the world of dental procurement, making it easier for you to shop smarter and faster.Just like Amazon simplifies online shopping by bringing the market to you, you can now shop for all your dental supplies online in one place with a dental procurement platform.Let’s take a look at how shopping online for your dental needs can save you money.
Critically, by leveraging the right software and implementing some simple inventory management techniques, you’ll know what you need to order when. This ensures you keep as much money in your bank account as long as you can, as well as mitigating the risks of taking significant financial hits that come with damaged, lost, or expired supplies.
In minutes you can create a list of all the supplies your dental practice requires and have access to current pricing and availability for your entire list of dental supplies from all the suppliers you currently work with and over two thousand more.Better yet, you can choose to purchase each item from the lowest-priced supplier or group orders to limit administration costs and save on shipping. This makes it easy for your front office to make the right buying choices for your practice, easing things for your dental staff while saving you money and improving profitability.
Method’s procurement software streamlines workflows and leverages automation to help improve your efficiencies throughout the purchase-to-payment process. So you can save on labor and improve your practice margins while freeing up your employees so they can spend their time on more critical tasks, like taking care of patients.
Have a long list of supplies you need? A digital procurement program can help you request, receive and analyze quotes so you can realize even deeper cost savings.Requesting quotes also allows you the opportunity to push suppliers just a little harder for other benefits outside of price. For example, you could gain improved payment terms, which alleviates cash flow or receive discounted shipping rates.
Suppliers are often willing to provide better than list price for volume requirements. All you have to do is ask. The right procurement platform will help you analyze your spend so you can leverage volumes for even more savings.
With digital procurement software, you get complete control of your purchasing and unlock the hidden value in your spend. Diversifying your supplier base also makes for a healthy competitive environment, motivating suppliers to watch their margins and ensure they offer their best possible price to gain your business.
Having all your eggs in one basket puts your practice at risk. Establishing a broader supplier base and having the ability to quickly and easily order from a long list of suppliers with visibility on their current stock as well as pricing ensures you can move quickly to cover your requirements in case of a disruption.Whether a supplier suddenly goes bankrupt, their lead times are extended due to supply issues, or perhaps your requirements spike; many risks lay within the purchasing process that may leave you short. Purchasing online with a product catalog of 500,000+ items gives you the power and control you need to ensure your practice avoids stockouts and maintains optimum service levels.
Diversifying your dental supply sourcing plan may take a little legwork. You’ll want to plan to invest a little time in trialing new products and vetting new suppliers. You may wish to establish a formal trialing process and ensure critical personnel can offer their feedback. You’ll also want to monitor suppliers’ performance and pay attention to if they deliver the right products in the right quantities and invoice at the right price. Hint: you should be doing this regardless as suppliers will often invoice incorrectly or increase prices without notice.However, a little work upfront can save you a lot in the long run.Companies everywhere have begun to realize the power of procurement to drive improved profitability because, unlike revenue, every penny you save goes straight to your bottom line.Besides improving your profitability and cash flow, as we’ve already shared, you’ll mitigate the risk of stockouts while creating easier ways of working for your employees so they can get on with other more critical tasks. If your dental practice is fighting to claw back margins due to increased cost and face increased exposure to supply risk due to covid, how you purchase the supplies presents an immense opportunity for improvement.You may wonder if your practice is too big, or too small, or just not quite ready to take on digital procurement. And what about upfront costs?Compared to legacy ERP systems like SAP, cloud-based platforms offer almost no barrier to entry as they are based on a pay-as-you-go subscription model and are quick and easy to implement. So whether you are a single or multi-practice, or even a DSO, there is a monthly package to suit your needs and you to scale profitably.Regardless of where you are on your procurement journey, as Dan Traub, Vice President of Product at Method Procurement, explains, Method works shoulder-to-shoulder with clients to help find solutions and ensure quick onboarding.
A simple automated process to help you plan and make purchase supplies can save you from costly mistakes. While moving to a single platform that multiple users can use can save your employees the hassle of having to scavenge through emails and deal with multiple supplier platforms by providing full visibility of orders and current status to the entire team.All that said. How exactly do you purchase supplies online? Let’s give you a quick run-through of how you would purchase supplies online with Method Procurement Technologies.Rapid order requestUsing Method’s procurement software, you can quickly and easily create new requests either from prior orders, inventory, or catalogs. By decreasing manual entries, auto-filling product details, Method saves you time and minimizes mistakes.Prior to submitting the order request, perform a cost analysis to compare pricing and availability and select the right vendors for optimal pricing and delivery. To ensure accuracy when comparing pricing, make sure to include each supplier’s surcharges like shipping and handling costsWant to order from multiple suppliers? That’s ok, you can include all the items on a single order request. Upon approval, Method will then automatically create and send the orders to each supplier! To see what has been approved or ordered, you can track the status of all requests from a single screen.Don’t forget, you can also:
Approve the order requestMethod provides you with the full order details for each request including quotes, specifications, billing method, and the cost analysis so you can make informed approvals and avoid expensive mistakes.To decline an order request: Select a pre-set reason for a declined request, or write your own, and return to the submitter.To partially approve an order request: You can select to decline certain items on a request while approving the others.Have some questions, would like to see some changes, or just want to verify accuracy? Easily collaborate with team members or view what you need by viewing the comments, quotes, purchase notes, and attachments attached to each request.Place your ordersAutomated, electronic ordering makes placing orders easy. Even ordering products from multiple suppliers is a one-click process.Once approved, Method will automatically convert requests into the necessary purchase orders and send them to each supplier. No work, no delay! And by electronically submitting orders directly to suppliers you reduce the chance for errors and delays.Keep track of your orders with complete order visibilityWorried if an order will arrive on time? Online shipment tracking allows you to easily see what has shipped and when you can expect delivery. As the order proceeds, you can also view receipt and invoice status by item and in one location, regardless of the supplier.To see the full history of an order request you can review the audit trail including orders, receipts, invoices, and payments.Method Procurement Technologies can help you better manage your spend so you can make more informed purchasing decisions. Gain visibility into current market pricing, request quest, and analyze quotes so you can leverage volumes and create a competitive environment so you can get the pricing, products, and service your practice deserves.Contact us today to arrange a personalized demo.
December 20, 2021
Some things are better in a group. When multiple dental practices band together, they can use their purchasing power to leverage better prices and purchasing terms from suppliers. A dental purchasing group or Group Purchasing Organization (GPO) allows your dental practice to save money on dental supplies. Your practice partners with other practices to order the same supplies from a company. Since you and the other members of the GPO order more than you would individually, the supplier is likely to give you a better price per item.Several GPOs exist for dental practices. Take a look at some of the largest dental GPOs, learn more about what they offer, and find out how working with a GPO can help you save money on dental supplies.
A GPO, or group purchasing organization, is a member-based organization or entity that relies on the buying power of its membership to get discounts from suppliers. GPOs are common in the health care industry and exist in other sectors, too. For example, farmers often form GPOs to negotiate better prices from the suppliers of raw materials and supplies. A group of farms is likely to need to order high volumes of seed or feed for livestock. Multiple farms are also expected to purchase high volumes of equipment.It's a similar situation in the healthcare industry. One medical practice typically won't need to order high volumes of supplies, such as bandages or lancets. However, several practices in the same geographic area can band together and order supplies together. When multiple practices place a group order from a supplier, the supplier is more likely to provide a volume-based discount. One analysis estimated that GPOs could help the healthcare industry save between $392.2 billion and $864.4 billion from 2013 to 2022.
GPOs vary in terms of their size, the services they offer, and the industries they serve. There are three kinds of GPO, and a GPO's type is determined by the industries served or the buying process:
One way to think of a GPO is as an intermediary between a dental practice and the vendor or supplier. The GPO works with suppliers or vendors to create contracts for supplies and services. The organization negotiates discounts and other terms on behalf of member organizations. It doesn't purchase items or services itself.Usually, the products purchased through a GPO are indirect. They are items or services a dental practice needs to continue to operate, such as vinyl or latex gloves, pens, and computer equipment.GPOs save practices money but participating in one isn't free. Something needs to fund the GPO, or it couldn't continue to exist. GPOs get funding in a couple of ways. One is by charging a membership fee. When a dental practice joins a GPO, it pays a fee. Depending on the organization, the membership fee might be one-time, or it might be annual.Along with the membership fee, many GPOs also charge administrative fees. These are fees a practice pays whenever it uses the GPO's contract. A GPO might charge a flat administrative fee that's the same for every arrangement, or the price might be based on the total cost of the contract. Even with fees, a dental practice is likely to find that joining a GPO helps save money.
The right dental buying group can help practices save time and improve profits by lowering the cost of supplies. Some of the benefits of joining a GPO include:
Several dental GPOS exist. Each one varies in terms of what it offers practices and its overall size. Depending on the needs of your practice, you might find it worthwhile to join one or more dental purchasing groups. Take a look at a few of the more well-known GPOs in the dental industry.
Dentists started Synergy Dental Partners in 2010. Its goal was to leverage purchasing power, helping owners of small dental practices save money. The GPO also aims to level the playing field, giving smaller practices access to prices usually only available to larger Dental Services Organizations (DSOs).
Unified Smiles works with dental practices at several stages in their lifecycles, offering operations management services, as well as opportunities to save money. The GPO has three tracks, including savings, solutions, and consulting.
United Dental Alliance is another GPO created to help dental practices save money. The GPO makes purchase agreements for its member practices, which allow those practices to get reduced prices on the supplies and instruments they need.
Save Dentists was also started by a dentist who wasn't satisfied with the prices he had to pay or the process of getting supplies and equipment. The dentist was also concerned about the future of independent dental practices. To develop a solution, the dentist partnered with other experts in the field, and Save Dentists GPO was born. The organization aims to reduce costs for independent dental practices by negotiating with vendors.
Dental Purchasing Group was founded in 2013 and is the only dental GPO in the northeast for group or independent practices. It works with more than 20 vendors and aims to help its member practices grow. Along with assisting members to save on spending, the GPO helps to reduce payroll, insurance, and credit card processing costs.
Independent Dentist Network is another GPO that aims to give individual dental practices the ability to band together and leverage the purchasing power of a larger group. It claims to provide all its members with transparent pricing and the same price on all instruments and supplies.
BEST for Dentistry works to provide its member practices with benefits, such as lower prices, typically reserved for larger, corporate dental practices. Along with negotiating contracts with vendors, the organization also offers consulting services to members.
The services offered by the top dental GPOs vary from organization to organization. Here's a run-down of some of the things a GPO can do for your practice and a quick list of who offers what.
The service most likely to be offered by every dental GPO is attaining cost savings. A GPO works directly with vendors, creating service agreements and contracts that benefit member practices. Once your practice decides to join a GPO, it can order instruments and supplies from any vendors that work with the organization. Doing so means you can take advantage of the lower prices negotiated with those vendors by the GPO.One thing to note is that different GPOs work with different vendors. Some GPOs only work with one or two vendors in specific categories, while others have agreements with multiple. Before agreeing to work with a GPO, ask to see its vendor list to ensure that the companies you want to purchase from are on it.Another thing worth noting is how the GPO transfers the cost savings to you and its other members. In many cases, the transition is seamless. Using the contract negotiated by the GPO, you simply need to order from the vendor to receive the supplies you purchased for a discounted price.The dental GPOs that offer cost-savings on equipment and supplies include:
Some GPOs go above and beyond, offering your practice a range of professional services, in addition to negotiating contracts with vendors and suppliers. For example, BEST for Dentistry provides consulting services to help your practice smooth over any human resources issues or financial questions. The Independent Dentist Network offers practice management, as well as legal and human resources assistance. Unified Smiles assists with managing your practice's staff and with retaining and finding new patients.
You and your team most likely need to complete a certain number of continuing education courses or credits annually to retain licensure. Continuing education can be among the services offered by a GPO. For example, BEST for Dentistry offers it from time to time, based on the needs of its member practices. United Dental Alliance also provides the option of continuing education credits and offers educational materials from its partner vendors.
Some GPOs also offer assistance with helping your dental practice be the best it can be. In many cases, independent dentists, who understand how challenging it can be to compete in a world full of larger practices, start dental GPOs. The founders of some GPOs want to do whatever they can to help smaller practices succeed.Unified Smiles offers inventory and practice management as a package that's separate from its purchasing package. It can work with your practice to help you streamline your inventory to reduce waste and lower costs. It will also work with you to help you identify areas of potential growth for your dental practice.BEST for Dentistry offers practice analytics that help you see where there is room for growth or improvement. You can use the analytics to work on boosting productivity.
GPOs make money in two ways. They charge their members fees for accessing their services, and some also charge the vendors they partner with a fee.Pricing models can take multiple forms, from an upfront, one-time charge to a monthly or annual fee. Some of the pricing models available include:
Some GPOs also have a free option, but the services you get for free are limited. For example, BEST for Dentistry has a free member plan, but it doesn't give you access to vendor contracts.One thing worth noting is that many GPOs give you the option of trying out their services before committing. The free trial period typically ranges from 30 to 45 days, based on the organization. If you're not sure what you need from a GPO or if working with one instead of another is worth the cost savings, it can be worthwhile to shop around and take advantage of the free trial offers before you commit to one or more organizations.
If you've decided that joining a GPO is an excellent way to help your practice save money and grow, there are some things to look for before signing up for one. It pays to shop around and try out different organizations to see which one is right for your practice. Another thing to keep in mind is that it might be in the best interest of your practice to join more than one GPO. As you weigh your options, here's what to pay attention to.
One of the first things to look for is whether the GPO is horizontal or vertical. If you're specifically in the market for a GPO that specializes in the needs of dental practices, a vertical GPO is the way to go. On the other hand, a horizontal GPO can suffice if you want to save money on more general items, such as basic office supplies or cleaning services. Depending on your situation and the options available to you, you might find that working with both a vertical GPO and a horizontal one makes sense.
GPOs create service agreements and contracts with vendors to pass on considerable savings to their members. Who those vendors or suppliers are is pretty important. The number of vendors that work with a GPO also matters.When investigating dental GPOs, ask each organization to provide a list of its members. Some GPOs are open and forthcoming with the information and even publish their vendor lists on their websites. Others might make you hunt around or ask before they'll give you their list.Vendor quality matters, but so does quantity. Depending on your needs, you might prefer to work with a GPO that has a list of 50, 70, or more vendors rather than one with a list of 20 or 25 vendors. However, if the GPO with the short vendor list works with the companies you're most interested in purchasing from, then that GPO could be your GPO of choice.
As noted above, a GPO can do so much more for your practice than help you get better prices on the equipment, instruments, and supplies you need. Some will also work with you to help you manage your practice, grow your practice or earn continuing education credits.When reviewing the services available, it's helpful to think about what your practice genuinely needs. It could be the case that, at this point, all you need is help to negotiate prices. You may already have your continuing education or practice management needs met. Since it can be easy to get wrapped up in the sales pitch, take some time to reflect on your needs. That way, you'll avoid investing more money into your GPO membership than you need or want to pay for.
Speaking of payment, it's also a good idea to consider your budget when looking for a GPO. The prices and pricing models vary considerably. It's a good idea to ask yourself what you can afford to pay. In some cases, you might want to try out a free organization to understand how things work. You can always upgrade to a paid option later.Another thing to consider is how the price of the GPO relates to the potential for cost savings. It might not be worth paying $99 per month for a service that will only save you $50 during that period. Look at what the organization claims to offer and the prices you can expect to pay for supplies and products once you join to see if your practice will benefit by saving money.
Take note of a GPO's reputation. Ask your colleagues or owners of other dental practices if they work with a GPO and how they would rate them. It can also be worthwhile to read about the potential benefits of joining a GPO, such as studies that track how much money other practices with similar needs saved by participating in one.
Ideally, the GPO you decide to work with will be open and transparent with your practice about its policies and procedures. One thing to find out is if the GPO offers the same pricing to all members or if some members get preferential treatment. Another thing to note is how upfront the organization is about its vendor partners and the range of services it provides.Finally, find out what your options are if you're not satisfied with the organization. Does it offer a refund or money-back guarantee? Can you leave the organization at any time, or are you expected to sign a contract for a specific length of time?
Getting the basic details about dental GPOs will help you become familiar with what's out there and your options. Once you have the basics down, it's time to zero in and focus on the specific needs of your practice. Here's what to do before choosing the best GPO for your practice:
If you're going to start paying $100 per month or more to join a GPO, you most likely want to know when you'll begin to see a return on investment (ROI). To calculate ROI, you'll need to have an idea of how much the GPO costs you and what you're likely to save by joining it.Finding out how much you're going to spend on a GPO is relatively simple. You can look at the price you'll pay annually or the monthly fee multiplied by 12. For example, let's say you decide to work with a GPO that charges an annual fee of $1,000.The next step is to find out what you're saving by being part of the GPO. Let's say you joined this particular GPO because you want to reduce the amount you pay for personal protective equipment. Previously, your practice spent $100 on each case of vinyl gloves you purchased. In a typical year, you buy 15 cases of gloves for an annual cost of $1,500. The GPO gives you a discount of 10%, reducing your annual cost to $1,350. You've saved $150.The GPO also promised to get you a great discount on dental anesthesia needles. The typical price you pay for needles is $25 for a box of 10. Each year, you go through 100 boxes of needles for a cost of $2,500. Joining the GPO means you get a 20% discount on the needles, reducing the price to $20 per box or to around $2,000 annually. You've saved $500.So far, your annual savings are just $650. To calculate your ROI, you subtract the value of the investment, in this case, your annual fee ($1,000), from the amount you've saved ($650), getting you -$350. You then divide -350 by your investment ($1,000) and multiply by 100. That means your ROI at this point is -35%. You've lost money by joining the GPO. To break even, you'd need to find more ways to save on supplies or find a GPO that costs less or has better discounts.
Finding and joining the right GPO is just one way to help reduce how much your practice spends on necessary supplies, instruments and dental equipment. Keeping good track of your inventory is also part of the equation. You want to combine excellent prices on products with smart inventory management to help improve your practice's bottom line, keep it in the black and avoid running out of the things your practice needs most.
An inventory management system merges technology with your process to allow your practice to keep on top of its instruments and supplies. The goal of an inventory management system is to track the life cycle of the products your practice uses.For example, you can use the system to log a new shipment of mouthwash. As each bottle of mouthwash gets opened and used, you can log that information in the system. Once the available stock level falls below a certain threshold, such as three bottles, the inventory management system can send you an alert that it's time to reorder.Although the exact features can vary from system to system, many inventory management programs include the following:
Using an inventory management system helps your practice avoid overspending on dental supplies and instruments. When you know exactly how much of a product you have on hand, you're less likely to order too much of it. Knowing your stock levels and getting reminders when supplies are low also helps you avoid running out. You don't want to be in the middle of a day full of appointments only to learn that you've run out of gloves or polishing paste.
Method Procurement Platform can help you stay on top of your inventory. Using our software platform helps you streamline and automate the inventory ordering and management process. Your team won't have to take time away from providing high-quality care to patients to ensure that the next shipment of vinyl gloves or anesthesia needles is on the way.Here's a quick look at how the platform works:
Getting a handle on your dental practice's inventory will help you enjoy further cost savings. Saving money and improving your practice's cash flow means more than just getting the best price on the items you need and use most. It also means ensuring that the products you buy get used and don't linger in the back of a supply closet or sit forgotten in a cabinet.Using inventory management software also keeps you from having to throw out unused products. When you reduce waste, you spend less, leading to even greater cost savings.
Once you've chosen the best GPO for your practice, it's time to focus on getting your inventory management under control, so you can boost your ROI and get the most from your money. See how Method can make the process of ordering and managing inventory smooth and hassle-free. Request a demo of our platform today.
December 13, 2021
Picture this — you resume at your dental practice one morning energized to get to work only to realize that you’re out of nitrile gloves and you're down to your last nose mask.To make matters worse, you have more appointments that day than you’ve had the entire week.Or, if you're at a dental support organization (DSO), what would you do if you discovered you’re out of dental supplies just when your members need them?Whether you run a dental practice or operate a DSO, every time you do not invest in proper inventory and manage your spending for your dental practice or organization, you waste funds and neglect a lot of opportunities to save on costs and improve your profitability. In fact, research reports that every dollar you save in your practice is equivalent to $2.80 you make in revenue.
However, you might face roadblocks. Sourcing for the best vendors and negotiating the best price takes time that you may not have.Creating an effective dental procurement and inventory management strategy for your practice or organization can ensure you always have the supplies you need at the best possible price.
An effective dental procurement strategy for dentists will help you purchase the right supplies, in the right quantities, in their best conditions, at the best price and at the right time.How will this benefit your organization?Among other benefits, a proactive and effective purchasing strategy can help you save between 6%-12% on your supplies purchases. This savings goes straight to your bottom line.Here are seven more ways an effective purchasing strategy benefits your organization:
How can you create a dental procurement strategy that brings all these benefits to your practice or organization?Here are 9 steps to creating a dental purchasing strategy for your dental practice.
How much of your total revenue do you want to spend in purchasing dental supplies?Specify a budget and try to stick with it.Because market prices change, without a budget, you may spend too much of your funds on acquiring new supplies and not have enough for other areas of your practice. Creating a budget can help you control spend.So start with a budget for purchasing supplies, and lay out exactly the items you want to purchase, the brand and the quantity.
How much of each supply do you go through in a day, week or month? Collecting some data on your usage might help inform your decision on the amount of each item you should get.Why should you do this?Getting specific on your purchase quantity helps you to ensure you purchase more of the items you always use — like hand gloves — and less of what you don’t always use — like implants.To help you order the right quantity, you need to look into your inventory to understand how your practice uses supplies. This will provide you with insight into the items you use the most, how much of them you have left and what your future needs may be for those items.
What steps do you follow to place your orders?Document a simple supply ordering process for your practice or organization. Make your ordering process easy, remove the bottlenecks and bureaucracy in your practices procurement process to speed up item ordering and payment.For example, some practices allow selected members of their organization to place orders by themselves — up to a given purchase amount — to eliminate delays in ordering and receiving supplies.Also, ensure everyone in your organization knows who’s in charge of purchasing. Make the purchase review and approval process fast, easy and simple so you don’t create roadblocks in your dental procedures because of standard practices or due diligence.To enforce this, you can lay out an organization-wide purchasing guideline so that new members will understand how your practice purchases new supplies.
Avoid relying on just one vendor, as it can impede your workflow if that vendor disappoints you or can't follow through on your orders.Also, sourcing for multiple vendors will help you get the best price and deals and help you save substantially in cost.You can start by doing a comprehensive search of all the vendors for the item you want to purchase, cross-checking them and requesting proposals or quotes.After you receive the quotes, compare prices to see the deals that provide the best combination of quality, efficient delivery and price to make your purchasing decision. You can make it a part of your organization-wide purchasing guide so that it doesn’t become a one-time affair.
Receiving expired — or near expired — products and the wrong quantity can make you bleed money.Always cross-check your order and invoice with the supplies you received to ensure they all match.Some practices have specific team members dedicated to ensuring the invoice, order and delivered supplies match to the last count. This ensures you get what you pay for, what you need to serve your patients and do not get defrauded by vendors.
Dental procurement software brings all of your purchasing activities into one place.The best dental supply price comparison software will enable you to source for vendors, find products, compare prices across different vendors and request proposals, efficiently and effectively purchasing the supplies you need, saving you time and money.For example, procurement software likeMethod provides you with over 2,000 vendors in an e-commerce-like shopping interface where you can source, compare prices and place your orders easily. That's not all — with purchasing software, you can also automate your invoice payment, receipt collection and supply tracking all in one place.This means a faster supplies purchasing process, convenient pricing, more cost-savings, competitive price comparison and more free time for you and your team.
A procurement manager can be a dedicated head of purchasing or one of your team members that can do the job. This person will be in charge of sourcing for vendors, receiving quotes, placing orders and receiving the delivered product.With someone in charge, everyone will know who to run to when in need of an item and your team will benefit from better communication and efficiency.
Dental Support Organizations (DSO) and Group Purchasing Organizations (GPO) can help you save time and cost in dental supplies purchasing.For your private dental practice, a DSO will enable you to outsource all your supply purchasing to a third party who handles everything and gives you the freedom and mental space to focus on helping your patients.A GPO can help you leverage the price negotiating power of a group to reduce your cost of supply purchase.Just like you may have gathered from the name, a GPO brings members together who purchase the same kind of products or services — for example, a group of pharmacies, hospitals or dental practices — to combine their needs and buy as a group. This enables them to purchase at a group price.With this, you can purchase your supplies at the lowest price possible, utilize the negotiating power of the group — compared to purchasing alone — and save substantially on your purchasing.
Forming a close relationship with your vendor can help you enjoy better deals, get pre-informed on market changes and get you the best price for your practice.
A simple and effective dental supply inventory management strategy will ensure you always have important dental supplies when you need them.In this section, we show you how a simple inventory process benefits your dental practice and how to create a simple and smooth inventory management system that gives you peace of mind.Here are six ways an effective dental supply inventory system will benefit your dental practice or DSO:
How do you create a dental supplies inventory system for your practice?Here are five steps to creating a dental inventory strategy for your practice or organization.
Choose a specific person or persons in your organization to take charge of your inventory.
It will be your inventory manager’s job to manage your order delivery and the movement of items in and out of your storage. As well as making orders for needed supplies.Having a dedicated inventory manager helps ensure you don’t order the same item twice, helping you save substantial costs. They also ensure you have accurate information on the dental supplies you have in store, what supplies you need to purchase and how fast you need to get them before it gets below the critical level.
Keep an active record of what comes in and what goes out of your storage to provide you with quick insight into the items that are available in your store. Also, it can help you understand the items that you use the most, how it relates to other items, usage from past periods and help you make accurate purchasing forecasts.For example, if your record shows that your implants usage increased compared to the past months, you can conclude that your practice will need more implants in the coming months. With this, you can place a higher order for implants in your next purchase.Your inventory manager will manage this log and can keep this record on a spreadsheet or use inventory management software like Method to track your use and stock of your practice supplies.
Create a schedule to consistently review your inventory so you understand your supply usage pattern and behavior, how much you spend on supplies purchase and create plans to better optimize your inventory management.Using dental inventory management software that gives you insight into your usage can help you effectively compare usage and inventory levels for different months, better understand how your practice uses different supplies and make the most accurate forecast to replenish your inventory.Also, this can help you uncover items that your practice no longer needs, remove them completely from your ordering list or reduce their purchase to help you save cost and maximize your storeroom.
A properly arranged and orderly storage room will help you access every item easily, keep track of inventory level and provide visibility into all you have available in your storeroom.Create a clean and ordered storeroom to enable you to keep proper track of your inventory level and make the best buying decisions.
Dental supply software, like Method, can enable you to track your inventory level, know when to purchase, make effective forecasts and track usage of supplies all in one place.Some inventory management software can also help you set notifications levels for different supplies to alert you when they go below certain levels so you can place new orders to fill them.With automation software, you can also make orders from the same platform, source for vendors, make payments and track your delivery with ease. This will help you save time, avoid wastage, provide visibility into your inventory and help you stay on top of your supply inventory at all times.
Which is best for your practice or organization, managing your inventory and procurement manually or using purchasing and inventory management software? Also, should you go for doing it yourself or signing up with a DSO?Below we lay out three strategies for deciding which is right for you.
If you run a small dental practice, with only a few staff and a handful of patients per week, you may be able to handle your inventory manually, without using automation software or working with a DSO.On the other hand, if you run a mid-size to large practice with more dentists and medical staff other than you, your inventory system is more complicated and may require more attention. You should consider working with a DSO and using inventory and procurement management software to manage your inventory and purchasing.Also, if you're with a DSO that uses manual spreadsheets to serve their numerous dental practices and medical institutions, you might not be getting the best deal. Consider investing in inventory and procurement management software to truly benefit from your investment.
Working with a DSO and using automation software most times requires a fee. Your practice’s revenue should be able to conveniently pay these fees.If you’re just starting out, you may consider doing everything in-house and scale up to software or DSO as you grow. But if you have been practicing for some time and rake in substantial revenue month-over-month, a DSO and automation software can help you increase your revenue faster. Your dental inventory management software price comparison will help you save money and get the best return.
How fast is your practice or organization growing? As a dental practice, if you forecast substantial growth in a few months’ time, signing up with a DSO and setting up automation to manage your inventory and supplies purchasing can help you prepare to meet the needs and demands of your growth.Also, if you expect a greater membership and higher inventory management for your DSO, integrating inventory and purchasing software into your operations now can help you better prepare for the expected increase in demand for your services.
Method is an end-to-end inventory management software purpose-built to help you eliminate the wastage and losses associated with managing inventory and procurement manually in your practice. According to our findings, when you switch to using Method, you can save anywhere between 25-30% of your purchasing costs. Additionally, those practices that invest in automation software can achieve up to 53% more growth than those that don't.That's not all. Here are more ways using the best dental supply price comparison tool can power your dental purchasing and inventory strategy:
All in an easy-to-use interface for an affordable annual contract with lots of training and customer support.
Want to see how Method can help you be more competitive and profitable in your dental practice?Contact us today to book a demo or discuss your procurement and inventory management needs. Our team of experts can help you set up the best strategy for your practice. You can also visit our product pages for a dental system software price comparison on our pricing page.
November 29, 2021
Once upon a time, there was a dental surgeon who was presented with an invoice for $10,000 worth of implant purchases.This is, for certain, a fairly regular occurrence and would have gone unnotable if it hadn’t been for the fact that only moments ago the man had seen, right next to the very office where he now stood holding the invoice, sitting precariously on a shelf, $100,000 worth of implant inventory.
He walked back to that very shelf and had a further look around. He saw some old broken boxes and expired inventory. Other shelves were overflowing with months, if not years’ worth of stock. The dollar signs floated around in his head like a Sunday morning cartoon. And yet, he was far from laughing.At a time when his dental practice struggled to remain profitable and viable, there was nothing funny about how much money was unnecessarily sitting on his supply shelves. And he hated to think of how much money had gone to waste in expired, damaged, or lost items. And so the Doctor decided then and there that it was time to take action and implement a more disciplined approach to inventory management and the supply ordering process.Luckily, he had only just spoken to Dan Traub, VP of Product at Method, about how their digital procurement process could help improve profitability and strengthen cash flow. Dan had told him how operating expenses come straight out of practice revenue, so every dollar you save is a dollar in increased profit. And yet, here he had been, focused on increasing production. But remember, Dan had said, it’s revenue you’re after, not production.And so, inspired to move ahead with changes, he pulled out his notes from their “meeting” that night in Vegas.How exactly was Method going to help him?First, he looked at the numbers Dan had given him. Supplies should represent 5-6% of revenue.
Although the Doctor wanted to believe they were spending responsibly, in reality, the practice was a busy place, and the office staff most often in charge of purchasing their very long list of supplies had no standard method for doing so efficiently or effectively. Supplies were often over or under-purchased, and they simply didn’t have the time to shop for the best prices.He knew for certain that supplies were running at least at 7% of revenue and that they were rarely hitting budget targets. Then he remembered what Dr. Kupperman, founder of NAK Dental Group, had said:“It really is a business management solution that gives us the tools we need to monitor our spending against our budget. We can implement standard processes, such as approving or declining proposed purchases before orders are placed, and avoid surprises so we can stay on target. We can work with any supplier we want to and allocate our volumes any way we see fit, and better yet, leverage them for stronger pricing.”He also feared whether they had enough control over the accounts payable process to ensure they were paying what they should. But that was a whole other story.It was time to get their stuff together.He took a look a look at a note his assistant had left stuck to her monitor. They needed to order:
He remembered what Dan had said about how when you enter an order in Method, it helps to monitor against your budget, either as a percentage of revenue to a maximum dollar spend, per department, per location, or overall. And that Method would give color-coded warnings as you enter or approve an order request, either by line or by order.He had gotten to take a look at the interface, and it reminded him of ordering off of Amazon, but better. They could easily shop for all their needs at once, could see current pricing and availability, choose to buy everything from their favorite supplier, or break it all up based on price. And quickly turn it all into orders.There was also an electronic bidding process and spend analysis so they could start leveraging their volumes for stronger pricing and better service, a good thing, given all the focus he had been putting on increasing production. The Doctor looked back at the sticky note and the messy, hurried writing and thought of Mary. She was bright and usually so chipper, and yet ever since the pandemic, her smile is now fast to fade.It was time to get them all some help. He grabbed the card Dan had handed him and picked up the phone.Ready to control your spending, save on your supply costs and improve your profits?
Get a personalized demo that suits your practice's needs
Your practice depends on smooth collaboration to work well. Your spend management activities are no different. Method keeps you connected to your team, suppliers, financial systems, and the dental community to efficiently procure all of your practice needs.
Prevent costly mistakes with a simple process to plan and make purchases. Allow multiple users to request products in a single platform, reducing email clutter and providing visibility to the entire team. Perform a cost analysis to compare supplier pricing before submitting a request for approval.
View the insights and details you need to guide the purchasing process. Method allows you to review and control purchases before they occur, regardless of the supplier. With full transparency, everyone stays in the loop and no requests are lost or forgotten. The approval process reduces unnecessary, incorrect, and duplicate purchases by simplifying collaboration across your team, saving money as a result.
November 22, 2021
Are you frustrated by a lackluster, less than beefy bottom line?If you’re looking for improved profits and continued growth, then controlling spend with a dental practice budget should be your first go-to.“Lowering expenses through cost savings, process-improvement efficiencies, and budget control mechanisms should be the foundation for profitable growth while providing valuable insight into where your hard-earned dollars flow.” Daniel M. Traub, VP of Product, Method Procurement Technologies.
Whoa, whoa, whoa…
Budgets are a financial plan that estimates revenue and expenses over a specified period of time and are periodically evaluated and measured against to see if objectives are being met.
“If You Fail to Plan, You Are Planning to Fail” — Benjamin Franklin.The answer is no. You don’t— unless you want to do better.Let’s be honest. There’s a little bit of teenager in all of us. Unless you love finance or purchasing dental supplies, most of us would like to spend as we like, how we like. Dental offices are most often run by Doctors and Office Managers, after all, and they have bigger fish to fry and patients to take care of. Nobody wants to spend their time pouring over numbers on an excel spreadsheet.However, gone are the days where profits just came as long as you were taking care of patients and despite your poor purchasing habits. Rising costs, stagnant or declining insurance reimbursement rates, and increased PPE requirements are just some of the challenges grossly eroding margins for a vast majority of practices.Today, in order to optimize your outcome and improve your profits, you must first plan and then measure against that plan.Referring to Investopedia, “A budget is basically a financial plan for a defined period, normally a year, that is known to greatly enhance the success of any financial undertaking… Corporate budgets are essential for operating at peak efficiency. Aside from earmarking resources, a budget can also aid in setting goals, measuring outcomes, and planning for contingencies.”Budgeting is also critical to avoiding debt, enabling you to plan and prepare for big-ticket items and unexpected expenditures. Planning a budget and keeping track of how much you earn and spend doesn’t have to be a pain in the… side. Nor does it require major math skills. But it does allow you to know where your hard-earned revenue is going and gives you tighter control of your finances and, ultimately, your profits.You’ll know how much you’ll need to fork out for things like labor, mortgage or rent, capital equipment, dental, clinical and office supplies, and laboratory costs. Budgets are key to maximizing the success of your dental practice, increasing profitability, and improving cash flow, so you can spend on larger asset purchases and continue to grow.Best yet, by leveraging technology and transitioning to digital procurement, you can gain extra advantages, such as increased visibility on spending habits so you can improve budget accuracy and monitor spending against your budget so you can gain better spend control and stay on target.If you haven’t yet completed a budget for next year, it may just be the perfect time to start. Additional to the above-stated benefits, controlling digitized procurement methods budgets can help you to:
Boost your EBITDA, increase your profits and your practice’s value. Get a personalized demo now.
November 15, 2021
Your stockroom may be a source of stress more than a handy area to hold your practice's dental supplies. Inventory levels may be inaccurate, and stock may be too high or too disorganized. Team members might have trouble finding supplies when needed, or you could be sinking an excessive amount of money into your stockroom, causing cash flow to be tight.
If your organization is facing any of these challenges, it may be time for you to reconfigure your inventory management system. By following these guidelines (or, if you’re a DSO, assisting your offices in following these guidelines), you can safeguard against financial losses and ensure access to necessary supplies when it matters the most.
Inventory management is essential for developing an efficient, productive dental practice. With a well-designed system in place, you can take the guesswork out of ordering products. Regular stock audits allow you to see how many supplies you have on hand and how much you use. Audits let you make informed decisions on how much stock to order, so you avoid running out of product when you need it the most.
Additionally, inventory management can help save money when purchasing products. An effective inventory management plan allows you to know how much product you need and avoid over-ordering. It also enables you to decide when to order based on expiration dates to ensure you waste as little product as possible.
When it's time to order, your plan will help you choose the suppliers that give you the best rates. Compare all associated costs, including shipping, so you can purchase with confidence and ensure you don't overpay. Between ordering the perfect amount of product and saving on supply costs, the savings can add up to thousands of dollars per year.
The first step of an inventory management plan is to develop a system for keeping track of your supplies. The methods for organizing your supplies will depend on your workspace and typical workflow. Your system should allow you to check inventory levels quickly and accurately.Here are some steps on how to better manage dental inventory.
Before planning how you would like to keep track of your stock, it can help to list areas where you have had stock issues over the past few months. By identifying these issues, you can develop well-informed strategies for eliminating them. Answer these questions to help you find areas for improvement in your stock management system:
A stock list allows you to quickly reference any supplies you need to order. Even if you have a comprehensive knowledge of every supply you use, the rest of your staff will need more specific guidance for ordering. A well-designed dental office inventory spreadsheet will include supplier information to assist in ordering, as well as determining current and maximum item quantities for your practice. Depending on your needs, you can also note pricing information, expiration ranges, special storage requirements, and other helpful notes.To create your dental office supply checklist:
Supplies with brief shelf lives are crucial for a stock list, as this record can help stop shortages caused by understocking and prevent waste from overstocking. Additionally, the supplies your dental office uses daily are critical to maintaining your service levels and are generally low-cost. While you want to avoid the risk of damaged, lost or expired products, it can be beneficial to err on the side of caution for these critical supplies by keeping more on hand.We find that the staff closest to end-use have a greater awareness of standard usage quantities. Consult them when establishing reorder points and setting order quantities. If you need a starting point for your stock list, we’ve put together a free dental office supply list template and order tracking spreadsheet, downloadable in google Sheets. You can also look online for dental inventory spreadsheet PDFs prefilled in a dental supplies inventory format.
Optimizing your stockroom's flow benefits your practice in many ways. An organized system enables you to find supplies easily when you need them, ensures correct storage for sanitization, and reduces the risk of injury in the stockroom. An organized stockroom allows you to perform stock audits efficiently and record items received or taken.Here are some tips on how to organize your dental practice's stockroom.
Choosing when to reorder dental supplies is a balancing act that can take a while to get right. Ordering too much too often results in reduced cash flow and the potential for wasting money on expired products while ordering too little can cause interruptions if you run out of product at critical times.Consider these factors to help you find the right moment to order:
Ideally, the vendor will indicate lead time in their quotes or on their website. However, it's important to note this is typically an average lead time and could vary depending on a number of factors. Actual delivery dates should be confirmed upon placing your order, so you'll want to keep an eye on these to ensure items will be delivered before you run out.
Also, keep in mind that sourcing dental supplies through suppliers with shorter lead times can help you maintain lower inventory levels and react faster in case of unforeseen requirements or shortages.
By pre-establishing a reorder point and reorder quantity you can make sure to keep enough on hand to keep you from running out before your next order delivers, but not so much as you hinder your cash flow and incur additional carrying costs unnecessarily.
After organizing your storage area, the next step is to standardize your process for ordering new supplies. All team members responsible for ordering should use the same approach to avoid mistakes and discrepancies. Clearly defining this process and keeping the procedures written in an easily accessible location will help increase ordering efficiency.Here are the fundamentals of a successful ordering process.
By splitting purchasing responsibilities among several team members, you can protect your dental practice from overpriced or unnecessary purchases or even potential theft and fraud. Even if you fully trust your staff to make the right choices, they are still prone to human error. An extra pair of eyes can help prevent mistakes before it's too late. If possible, you should separate purchasing responsibilities for requesting, placing, and approving purchases, submitting payments to vendors, receiving orders, and auditing the stockroom.
When preparing for a purchase, you should compare prices between several vendors to find the best price. Sometimes the prices may seem nearly identical or only a few cents off. However, minor price differences can accrue over time, potentially resulting in hundreds, if not thousands, of extra dollars spent on supplies. When reviewing supplier quotes, you should also consider:
Calculating what the price difference would add up to over a year will also inform your decision. Method Procurement’s digital RFQ process can help ease the sometimes cumbersome process. By providing a digital platform that streamlines the end-to-end process, making it quicker and easier for suppliers to submit their bids, you’re more likely to have more vendors participate. Method will also help you compare and analyze responses across many suppliers to ensure optimal pricing and timely delivery before your order is placed. Once you’ve selected your vendors, you can then quickly convert quotes to POs, even sending them directly to vendors.
When you're ready to place an order with a supplier, send the request as a purchase order. A purchase order is a legally binding confirmation between a buyer and seller, acting as a contract to keep a vendor accountable for their promised prices and deliverables. Purchase orders benefit dental practices because they help avoid the price creep of dental supplies. Some suppliers may try to take advantage of a disorganized practice by increasing prices, and a purchase order holds a supplier to their word by improving pricing visibility.
Upon the arrival of new stock you must ensure you account for every item ordered. Check the shipment for any signs of damage and make sure the amount you ordered matches the amount you received and the amount displayed on the packing slip. Also, ensure the product received is what you ordered and that it is in good condition. There's a chance the supplier may accidentally send different brands or slightly different versions of products or that it was damaged in transit.
If you find any discrepancies or damage in the ordered products, you should report those issues to the supplier right away. It is best to take care of issues as soon as possible because some suppliers have a limited time window for addressing order issues.
Once you've counted the product in, you should make a note of the change in stock with your inventory log, updating listed quantities so you have a better indication of stock levels. Also, be sure to place newer supplies in the back of the storage area and use the older products before they expire.
While it's possible to keep track of supplies on your own, inventory management software can streamline the process, so you can spend more time focusing on your patients. With automated processes and a modern user interface, inventory management software makes the process easy. Here's how inventory management software can help your dental practice.
Organizing your supplies is a breeze with inventory management software. Rather than mapping out a stock list manually, the software can help you quickly build a stock list of the industry's best and most up-to-date supplies. The best procurement software can offer an online catalog of thousands of unique dental products so you can find anything you need.
You can also use inventory management software to equip items in your stockroom with barcodes. A barcode scanning system allows you to quickly identify products for reordering and can even help you quickly find items in the stockroom, acting as a dental office supply tracking system. The barcode system is beneficial in larger stockrooms that contain many different products.
Inventory management software can generate inventory audits and usage reports for auditing your stock. Analyzing these reports will help you better understand the flow of supplies and help inform the best stock levels for future ordering.
When suppliers compete for your business, you have the best chance of finding a low price for your dental goods. Calling or emailing suppliers can be effective, though the process is often slow due to delayed response times. Inventory management software allows you to send multiple requests for quotes and proposals with a single process.
Smart inventory software also assists you in reviewing quotes. Especially if you request quotes from many different suppliers, it can be challenging to compare them all. The software can perform cost analyses on each quote and proposal while also ensuring each quote meets your practice's needs. And with all quotes housed in a central platform, you reduce email clutter and notes from phone conversations, ensuring accuracy and ease of access.
All team members involved in purchase decisions have access to a centralized ordering platform with inventory management software. Team members can collaborate on requests within the platform, attaching notes and approving or denying specific parts of a proposal to ensure your practice orders precisely what it needs. You can also use the platform to track requests and order statuses for complete transparency in the ordering process.
Reordering supplies is quick and easy with intelligent software, too. Low-stock alerts help you know when to order before you face a stock issue. You can also quickly create order requests based on previous orders and have the program automatically fill in the supply information to save time in the process.
Smart inventory software helps simplify the receiving process by allowing you to check new shipments into your stockroom. You can record quantities received, inspect shipments for accuracy, record product conditions and attach photos to receipts for proof. Keeping all your order information in a single place helps to keep suppliers accountable, so you only pay for the stock you can use.
Your inventory management software can keep you from overpaying for your dental supplies. The software can help you cross-compare invoices to purchase orders and received supplies and identify discrepancies between them. You can check for billing errors from incorrectly keyed amounts and quantities, protecting you from overpaying and fraud.
Smart inventory management software makes keeping track of dental supplies simple. At Method Procurement, a team of dental industry and technology experts built our cloud-based system specifically for dental practices. Our team's valuable experience allows us to identify the unique procurement challenges dental practices face. With intelligent solutions engineered by veterans in the field, you can confidently manage your practice's supplies.
Method procurement software simplifies every step of the inventory management process. We offer systems for tracking your office's supply inventory, requesting quotes, purchasing from suppliers, and more. Our processes can help improve return on investment while also equipping your team with the resources necessary to streamline your purchasing processes.
Ready to improve your inventory management system? Request a demo today or get in touch with our team if you have any questions!
November 8, 2021
Procurement is having a moment. As companies worldwide feel the effects of the global pandemic and experience rapidly declining profits, they’re turning to procurement to help drive out costs and improve profits. The dental industry is no exception, which is why we’re offering a limited-time offer on our essentials package, so you can get up and on your way to improved profitability now.
Why is procurement such a big deal? Look at it this way: For every dollar that you save in procurement, you would need to generate nearly three dollars ($2.94) in production revenue to net the same improvement to your bottom line.Additionally, procurement transformation can bring about a 30% reduction in process costs.Purchasing the supplies your dental practice requires to run is not an option. So why not do so in a way that saves your practice money and saves your employees headaches, allowing you to better serve your patients and scale profitably?
The running of your dental practice requires a long list of supplies, the management of which is highly cumbersome and overwhelming to deal with, which is why Method was specifically designed with the dental industry’s needs in mind.Designed to bring everything you need to purchase your dental supplies, faster, and smarter for improved profitability and increased efficiencies to your fingertips, Method helps mitigate the risks of stockouts while making life easier on your employees.Streamlined processes leverage automation and big tech to do all the hard work for you, empowering your employees with the information and easy ways of working they need to make the best purchasing decisions for your company. Essentially, Method allows you to buy everything you need, quickly, and cheaply.
They say the best place to start is where you are. The Essentials package is everything you need, so you can do just that.Ideal for practices who are just beginning their procurement journey or even just learning about what procurement is (better, smarter purchasing that saves you money and mitigates risk), Method’s Essentials package will get you up and going on your way to improved profits quickly and easily. It’s everything you need- and nothing you don’t.Method’s platform is easy to use, much like shopping on Amazon, but with even more built-in flexibility so you can shop smart and fast across a product catalog of 700,000+ items and 2,000+ dental-specific suppliers. It’s the industry's most comprehensive cross-match of dental products, including private label items.Compare market pricing across a catalog, or request a quote and perhaps receive more competitive pricing based on your volume requirements. Whether you choose to order all your requirements from your favorite supplier or save every penny you can by ordering each item from the lowest cost supplier, our Essentials package provides you the tools you need to deliver savings to your bottom line.For a limited time, we’re cutting the Essentials Plan from $129/month/location to $69/month/location, making it even easier for you to:
An electronic procurement program allows you to streamline processes and build efficiencies while maximizing results. Simply put, digital methods uncomplicate the complicated, making it easy for you to make strategic cost-saving purchasing decisions, leaving less room for error and more time for you to focus on doing what you do best- taking care of patients.Fill out our form to request a demo, and one of our client success managers will reach out.
November 4, 2021
So first, we dug into dental formularies, what they are and why you should build one, and then we walked you through the steps of building a dental formulary. So by now, you’ve analyzed your data and have narrowed down the list.However, in order to drive formulary compliance, keep your staff happy, and mitigate your risks, before you finalize your final formulary, you’ll want to assemble a team to trial, evaluate and help select the final products.
This will allow you the opportunity to bring everyone on board and help finalize a formulary that will help drive compliance. Why is driving formulary compliance so important?Because implementing cost-saving procurement strategies and negotiating contract pricing requires gaining control over how your business spends its dollars. Suppliers need to know that you will be able to execute on an agreement once you’ve negotiated. And in order to capture the cost savings you’ve negotiated, as well as maintain your word, so suppliers keep coming back to you with their best pricing, you’ll want this to.Secondly, allowing staff members to order supplies without policy or supplier and product approval processes introduces a myriad of risks to your organization (supplier solvency, poor quality, missed deliveries, and lack of compliance to regulatory requirements, to name just a few.)Lastly, as long as you do the work to ensure the right items are on your formulary, taking the decision-making out of your employees’ hands should ultimately be a relief and allow for a quicker, more systematic purchasing process (something you may want to point out to them.)
The size and makeup of your trial team will vary depending on the size of your organization and could be as few as one or two or may run up as large as 20 or 30 for larger DSOs. You know your staff the best, but consider involving those who will be willing and active participants as well as those whose opinions should be heavily weighed.The team should also include those who do the buying and receiving of the products along with those who actually use them. This could consist of doctors, dental hygienists, assistants, or the chief dental or clinical officer if there is one. This will allow for varying areas of experience and knowledge to be ‘brought to the table.’ For instance, the person who most often does the buying likely has a better grip on which suppliers have better service, pricing, and lead times while those who use the product know what items they prefer to use, and which they don’t and why.You’ll also want to ensure to include someone who will act as the ringleader. This does not need to be the person with the loudest voice or biggest opinion. But if at all possible, someone who is diplomatic, organized, and gets along with all would be best suited for the job. This person should help to keep the trials on track and ultimately ensure that a final decision is made.
Clinical trials and evaluations allow you to ensure you’re making not only the best possible decision for your practice but also for your clinical staff. It’s a critical step in gaining formulary compliance and mitigating your risks of purchasing poor quality or non-compliant products.To improve the likelihood of compliance, ensure to communicate that trials are the time for people to voice their opinions, and do your best to include those who will have them so those tough conversations can be had during the trial process. It should be made clear that once the formulary is made clear, people will be expected to abide by it.Although the aim is to gain buy-in and ensure your staff has the items that allow them to serve your clients best, it’s important to remember that you’re not always going to get a unanimous decision. We suggest you broach this subject from the beginning and explain to all team members that although everyone will be listened to and all opinions will be taken into account, it is simply not likely everyone will agree with every decision.Compromises may need to be made, and some frank and perhaps uncomfortable conversations may need to be had. However, with or without consensus, a final decision must be reached, and all must get on board.
Procurement decisions or strategies should never be allowed to become stale, and suppliers should never be allowed to become passive in their efforts to earn your business. Therefore, conducting trials should be an iterative process where new product options or new suppliers are vetted on a somewhat consistent basis.Once you’ve assembled your team, you’ll want to set up a formal process to evaluate and document outcomes. There are many options on how you go about this, and the final format depends greatly on the size of your team, as well as your organizational structure (who does and decides what.) However, here are a few things to consider:In the end, you want to ensure all factors are weighted in the final decision making, but give thought to your organization’s structure and who should analyze and consider what into their decision-making process.You’ll want to create a trial form that is to be completed upon execution of the trial. Consider if you want to provide a price, lead time, and any other pertinent information that should be weighted into team members’ evaluation and decision making. If procurement data is analyzed by management, then you may want team members to evaluate the product only.Below is a list of items you may want to include on your trial form:
You’ll also want to provide a simple but structured rating system. For example,
Lastly, you may want to give thought to asking specific questions. Such as:
Once you are ready to start your trial process, obtain samples. Note that samples are often provided at no charge by the manufacturer, so it’s at least worth the ask. It also provides you an opportunity to let them know that you are implementing a trial procedure and are maturing your procurement practices. This may motivate them to step up their game and ensure they sharpen their pencils and provide you their best possible service.Lastly, the trial procedure should be a valued one, not a rushed one. Keep in mind that some items may require a second lengthier trial. At the end of the day, you want to make sure you’re selecting the right items for your practice, your patients, and your bottom line.
Alright, now it’s time to review your results and decide on steps forward. Firstly, you’ll need to gather your trial information in an easy to review/ access format, and hopefully, one you can easily refer back to later. This could be as simple and dropping all the data into a spreadsheet and averaging out the scores.However, when reviewing the results, don’t just rely on the average, take your time to review them individually, look for “outliers,” scores that vary greatly from the rest, as well as any comments noted. You may find something very well worth considering.You’ll also want to set your “pass” and “fail” scores. If you’ve used the 1-5 scale, then likely a 3 would be considered a pass. If you use a 1- 10 score, anything over a 5 would be a pass, you get the idea. Also, beyond assigning a pass/ fail, you’ll want to compare this trial to other trials for like items, if there are any. And at some point, there should be.Approving more than one supplier for your critical goods mitigates your risk of shortages, but also sets you up for creating a more competitive landscape so you can start to leverage your volumes and drive some serious cost savings. For these reasons, you may want to give consideration to setting a secondary formulary to act as your plan b items.This way, if an item is out of stock, lead times get significantly extended, or the price skyrockets, you have a second option already approved. This limits your reliance on a particular vendor, but it also has the added benefit of showing suppliers that price increases or decreases in service levels will have an immediate impact on their sales, making them more likely to keep them in line.
Although at first, you may want to focus on qualifying only the most aggressively priced suppliers, in order to actualize cost savings as quickly as possible, in the long run, this may not be your best strategy.At all times, you’ll want to ensure alignment of values in your decision-making. For more clarity on that, pop on over to Value Setting- Price. Quality. Service.However, focusing on quality first may put you in a better position to get it all. Here us out.In the end, your goal is to purchase the most preferred products, receive optimum service, and get it all at the best possible price. So, one could say, that a good strategy may be to start by qualifying what you consider to be the “best” items.Even with the most robust supplier relationship management efforts, it’s not likely you’ll have much influence on a manufacturer’s level of quality. If you’re lucky, with some work, you may be able to improve service levels at best. Price, however, is always negotiable.
It’s important to remember that salespeople are often hesitant to reduce pricing if it’s not likely to get them a sale. And of course, people often have good intentions, but fail to follow through, negotiating better pricing but then not shifting over the volumes, which leaves the salesperson having to explain what happened to management.Once a supplier knows they are qualified, and that you have control over your procurement practices and can execute on agreements, you can make it clear to them that the remaining barrier to awarding them more business, pricing, is theirs to remove, and they should be more likely to do so.When it comes to pinching your pennies, it can be tempting to get carried away, piecemealing your orders out to the lowest price bidder for every item. In order to improve the profitability of your dental practice it’s important you factor in more than just cost per item. If you haven’t already, find out more about the pitfalls that may be taking a bit out of your profits in When Every Penny Counts: The Pitfalls of Dental Procurement That May be Biting Your Bottom Line.Supplier selection and strategies go a long way in ensuring a process that affords you long-term cost savings so you can continue to leverage your trial results and your volumes.
October 18, 2021
“The whole is greater than the sum of its parts.”- Aristotle A formulary is a list of dental supplies. It’s that simple. So why is something so simple so important?
The main objective for procurement is always to buy the right items, at the right time, in the right quantities, and at the best possible price. Building a formulary is your ticket to getting there. Inventory management, purchase orders, monitoring spending practices, tracking pricing, paying invoices, and analyzing historical data for insights-driven decision making are all eased when you scale down and solidify the list of dental supplies being purchased. We’ve all heard of economies of scale. When you spread a fixed cost over a number of goods, the larger the number, the lower the total cost of each good. In sales, these economies of scale are, in part, then passed onto customers as an incentive to buy in larger quantities. It’s a win/ win, as both buyer and seller reap the rewards. In production, this same principle is referred to as improving efficiencies (doing more with less) and applies just as well under your own roof as it does when purchasing from a supplier.
Leveraging volumes is an exchange, an agreement to a price for a certain volume. Building and adhering to a formulary allows you to implement efficient, streamlined processes so you can negotiate and execute on volume commitments. Let’s for a minute imagine a DSO with five dental practices, each with their own spending habits, buying a different item as they see fit every time they purchase. The DSO could be spending, let’s say, $1,000,000 in dental supplies per year across all practices. This DSO should, in all rational, be enjoying much more favorable pricing than a singular practice with only one-fifth of the spend. However, the reason they may not be is threefold. Firstly, the whole of your like items is worth far more than the sum of its parts. When purchasing volumes are spread out over too many items, this weakens their power as you are unable to take advantage of larger quantity price breaks. Amalgamating your purchases to a limited number of items through the use of a formulary both increases your total volume per item while giving you the data and the control you need to leverage them for further savings. Second, without a formulary, the purchasing habits of the five practices are unmanageable as a whole. Over the five practices, the company could be purchasing hundreds if not thousands of different items. This brings us back to efficiencies of scale, tracking usage, pricing, and inventory (so you know what to purchase when), all become too labor-intensive and unmanageable. And lastly, if each practice continues to buy as they wish, the lack of control and unity over purchasing decisions leaves multi-location DSOs unable to execute on agreements. Suppose quotes and the subsequent awarding of business do not translate into actual orders. In that case, the savings for your dental organization aren’t actualized, and suppliers aren’t likely to continue to expend efforts on future bids. This not only causes them to continue to pay more than they should but can damage their reputation and hinder future negotiations. Improving visibility and gaining control over the spending habits of each of your dental practices ensures suppliers that they will, in fact, gain the business you are looking to leverage in return for profit-improving cost savings.
Poor procurement practices come at a very high cost. Building a formulary not only brings the manageability needed to extract the pricing your buying power should afford you, but it is also the first step in adopting more mature procurement strategies. Implementing best practices and leveling up with tactical procurement further mitigates your risks, increases organizational efficiencies with streamlined workflows, and safeguards your profits.
Alright, we’ll be honest, there’s not too much magic here. The actions are fairly simple. However, there may be a large amount of data that may seem overwhelming. As you work through it and design your format, remember not to get lost in the granular by keeping an eye on your overarching goals and what data you are looking to extract. Hopefully, you’ve brushed up on your excel skills. Here are some quick tips and tricks to getting ‘er done:
If you are unable to do so from your own record keeping, your suppliers, whether they be distribution partners or manufacturers, should be able to provide you with a record of your purchases. This should include the item/SKU number or manufacturer part number, category, name and description, unity of measure, and breakdown (sold by the box with 12 units per box), as well as detailed order history and purchase price.
Quick tip #1: Whether it be Darby, Henry Shein, or Brasseler, your suppliers should be able to provide your information in a digital format, most preferably excel. Also, there’s no need to hide what you are doing. This may be the perfect time to put a bug in your suppliers’ ear and let them know you’re upping your game, and perhaps they will too.
You’ll now want to organize your disparate data into a standardized format. We suggest leaving all original by order detail and then total your purchases by month as well as year.
Quick tip #2: When setting up your format, remember you’ll want to be able to see totals by the number of units and by dollar value, by the supplier, by item, by month, as well as by year. You may also want to count the number of transactions to allow for easier and deeper analysis.
Although this could easily become your kickoff formulary, we suggest you take some time to look for some low-hanging fruit. Take advantage of your newly found visibility to look for purchasing trends and poor practices. Look for the obvious. There may be some outliers or easily identifiable bad habits you can quickly nip in the bud and cut from the list. Remember to rely on your “go-to” team members, prod around and ask questions on the reasons, or the people, behind purchasing decisions.
Quick tip #3: Focus on item reduction, and don’t be afraid to ask your suppliers for their input. There may be some items that are like enough to others that you can consolidate without too many complaints or issues. Your suppliers should know their products and your purchasing habits best. Don’t be shy in asking for ideas or recommendations. This is a good chance for them to show you the value they can bring.
The problem with putting out a “starter” anything is that more often than not, you never quite make it to the next stage. Before you publish and implement your formulary, we suggest you:
Lastly, to ensure you reach your objectives, implement a systematic process for monitoring and increasing compliance (hint, Method can help with that!)
October 11, 2021
Think only DSOs have the volumes necessary to achieve DSO level discounts? Not so. With the right tactics, systems, and processes, single location practices can obtain deep DSO-like discounts on their dental supplies. And don’t worry, it’s easier than it sounds.There is no need to price shop every item yourself, although we make it easy for you to do so if you like, with real-time market pricing and availability on over 400,000 products at your fingertips. Doing your homework and getting to know market pricing and who the aggressive players are, is never a bad thing. But it isn’t the only, or even the best, way to save.An automated RFQ process is a simple but powerful process that allows you to leverage your purchases for better pricing so you can play like the big guys and save like them too.
From Investopedia, a request for quote (RFQ), also known as an invitation for bid (IFB), is a process in which a company solicits select suppliers and contractors to submit price quotes and proposals for the chance to fulfill certain tasks or projects. The RFQ process is especially important to businesses that need a consistent supply of a specific number of standard products.Simply put, an RFQ asks suppliers to quote on your needs, saving you time while presenting them with the opportunity to sharpen their pencils and put their best foot forward. Selecting and awarding business is tactical procurement rather than transactional purchasing as is done with the intention to shift volume from other suppliers in exchange for special pricing.The RFQ process is made up of four phases: preparation, processing, awarding, and closing. Method streamlines, standardizes, and automates these processes, making it easy for you to play, and save, like multi-practice DSOs.
Methods pre-vetting of dealers mitigates your risks and allows you to safely increase competition. You can issue your RFQ to a list of vendors, resting assured you’ll receive authentic, licensed products from legitimate vendors.Firstly, consider who you want to put the quote out to. In your first few rounds of RFQs, you likely want to cast the net wide and ask them to bid on a specific order to be fulfilled. At this point, the more knowledge you can gain, the better. You’ll also start to attract the attention of new suppliers, creating more competition for your business, and the better you’ll be able to negotiate.However, as your procurement practices mature and you have gathered enough historical data to know your monthly requirements, you may want to put out an RFQ for longer-term or higher volume commitments.
The utilization of streamlined procurement software provides a uniform format that aids in the bidding and comparison process. Suppliers are asked to respond digitally, and inputs are automatically loaded into your system and displayed in a user friendly, easy-to-compare format.However, now comes the tricky part, deciding on your steps forward. Awarding business should be a tactical move, with thought given to longer-term strategies. A little extra effort here looking “outside the box” can go a long way because there is more to good procurement than just pricing per item.
Humans often tend to have a hang-up with asking for things. However, when it comes to negotiating yourself a better deal, it’s a roadblock to cost savings that is easily overcome. Take a moment to make the ask and give your suppliers the chance to surprise you.And here’s one vital piece of advice to always remember when selecting your vendors. It’s easier to get a trusted, proven supplier with impeccable quality and service standards to come down on price than to improve quality and service with a less than par supplier who offers aggressive pricing. Oh, and another thing, never trust the outliers. If one supplier is offering far lower pricing than everyone else, it could very well be legit, but always ask why.
Although it’s a crucial first step, there are more avenues to be explored when it comes to improving profitability and achieving a healthy balance than simply looking at an item’s purchasing price. Taking a look at opportunities for early payment discounts is another way to lower your costs while requesting extended payment terms and selecting vendors with lower lead times can improve cash flow.Some suppliers may even offer training programs, a more impressive product catalog, or better warranties. Let suppliers know that although a competitive pricing per unit is crucial, sweetening the pot with value-add payment terms and services may set them apart from the competition and make for the type of long-term, mutually beneficial partnerships you’re looking for.
Although you can simply jump to awarding the business to the vendor that submits the lowest overall bid by issuing a purchase order, it’s worth your time to take a moment and ask suppliers to requote. If you have preferred suppliers you have a history with, you could choose to give them the last right of refusal and see if they can beat out the other players.However, it’s important to play fair as this ensures suppliers don’t feel like they’ve wasted their efforts and maintain their interest in your business. Always keep in mind and abide by procurement ethics and the dos and don’ts of supplier relationship management.As we have said before, we understand not everyone fancies themselves a master negotiator. But in truth, you don’t have to be. More often than not, once you’ve laid the groundwork by creating a competitive environment, have done your homework on market pricing, and issued RFQs, it really just comes down to making the ask.Gone are the days of shady negotiating tactics, be direct, honest, and transparent in your dealings and communication. Salespeople are just people who are just looking to do their jobs. Your transparency and ethical procurement practices will be greatly appreciated.
It’s essential to keep in mind that there are costs incurred for every purchase order that should be considered. Dividing orders into a multitude of purchase orders can come at a high cost. When comparing pricing and deciding on how to award orders, make sure to keep in mind the pitfalls, such as shipping and labor costs, that may end up taking a bite out of your cost savings.If you’re ready to level up and are looking to move to strategic supplier relationship management, now’s the time to build your strategy and award your volumes accordingly.Taking the time to give suppliers a chance to sharpen their pencil goes a long way in building stronger, more conducive long term relationships. So go ahead, don’t be shy, and make the ask.Method’s procurement management system automates the best practices that ensure proper closing of an RFQ. Prices from submissions are automatically populated into the purchase order upon creation, and the three-way match process then cross validates the data from PO to invoice. Systematic, streamlined processes create accountability and help you avoid price creep and reduce your dental supplies costs.
Learn to play like the big boys, and you’ll save like them too. With Method, you can have the systems the big boys use to help them manage the entire process. Contact us today to see a demo and ask any questions you have to one of our dental procurement experts!
October 4, 2021
Organizing your orthodontic practice inventory is necessary as your practice grows. With accurate inventory management, your office team ensures you have the right materials at the right time and keeps your supplies on hand. Manage your dental supplies better when you work with Method Procurement Technologies.
Method cuts down the time you spend on manual inventory by allowing you to manage, track and reorder your stock automatically. When you invest in Method software, we will cover every step of the inventory process.
Method's catalog of over half a million unique dental products lets you quickly update your inventory without manually inputting every product you purchase. Barcode scanning functionality lets you quickly manage your smaller items.
Understocking and overstocking negatively impact your practice's bottom line. Method prevents waste, saves space and helps you organize your stock for easy access to your supplies.
Method sends you notifications as your stock decreases to ensure that you always have time to reorder your most important supplies straight from specialty manufacturers. With a catalog of more than half a million items, reordering is lightning fast.
Receiving and storing can be a time-consuming process. Method speeds it up by ensuring an accurate product count before moving your order to its designated storage area so your stock list is up-to-date.
Method Procurement comes with all the comprehensive features necessary to streamline, optimize and strengthen your inventory management practices.
Method gives you real-time access to current order information, pending receipts and current stock for your dental practice's inventory.
With Method, you can reorder your supplies from a list of your current inventory and ensure that you always have the most critical items. Many of our orthodontic products are shipped directly from specialty manufacturers.
Method's database and catalog hold over 500,000 unique dental products and gives your access to thousands of products right at your fingertips. Find the most competitive prices and quality with the power of our extensive medical product catalog.
See which dental and medical supplies you have in stock at each of your practices by searching for item description, manufacturer, category and additional criteria.
Use your stock data to determine whether you're buying too much or too little of the products you use every day. With Method, you'll always have the right amount of brackets, wires and cement.
Method automatically provides you with analytical reports of your frequently used items, value, discrepancies and low stock items.
You can now provide role-based access to your staff by practice location, responsibilities or purchase amounts.
With Method, you can automatically generate and send purchase orders to your dental suppliers based on your previous usage. You can order your supplies from any orthodontic supplier with ease.
Method inventory management software saves you time and money so your practice can get back to serving your patients. Our software saves you money in the following ways:
Method Procurement optimizes dental practice inventory management and helps your practice reach its full potential. With real-time insights, inventory reporting and automated ordering, your staff will have more time to assist you and your patients.Learn more about Method Procurement's inventory management solutions by reaching out and scheduling a demo. Contact us online today and see the difference Method can make for you.
September 30, 2021
When times are tough, it's important to remain rooted in best practices. KPIs are crucial to reaching business objectives and ensuring your goals are at the front of mind and inform daily decision-making. To optimize effectiveness (and not waste your time), choosing the right KPIs for your dental practice is the key to success.KPIs help eliminate ambiguities by setting definitive milestones that can be broken into weekly, monthly, or quarterly objects. To be effective, KPIs should be SMART— Specific, Measurable, Achievable, Relevant, and Timely.
The metrics you choose should promote the actions you want your employees to carry out and align with your strategic targets. Once you've selected your KPIs, they need to be communicated to your team and tracked on an ongoing basis.When you've implemented some procurement best practices and established some purchasing history, you'll have the data you need for informed, strategic decision making. Now it's time to analyze the data so you can select your KPIs.Here are a few KPIs focused on procurement and inventory targets you may want to focus on:
Suppose you have a fairly consistent demand for a critical dental supply. In that case, you'll want to avoid any large spikes and significant drops and achieve a constant flow of material that coincides with production needs. The average inventory KPI estimates the average on-hand inventory at any given time period.
The rate of inventory turnover measures the rate at which your stock is replaced and helps you keep an eye on how much obsolete stock you may be carrying. For items consumed regularly, you'll want to make sure you're not impeding your cash flow by ordering too much or risking stockouts by ordering too little. This KPI will help you ensure you are getting it "just right."
Disorganization or mismanagement of dental supplies is an often faced concern for dental practices. Damaged, lost, or perishable goods with a limited shelf life are all causes of inventory write-offs. Monitoring this with a KPI allows you to keep an eye on the costs and work towards limiting your losses with improved organization and procurement best practices.
The three-way match process is essential to validating the data that supports the payment of an invoice. This ensures you are invoiced and pay the price your suppliers committed to, that your supplier's documents align, and that your purchase orders are being entered correctly.Discrepancies in data between a purchase order, packing slip, and invoice are hugely time-consuming. Monitoring with the first-time match rate KPI allows you to dig into root causes and establish processes that lower your cost per transaction, have solid procurement controls, and end-to-end efficiency.
The spend under management KPI is well suited for DSOs or stand-alone dental practices with maturing procurement processes. If you're in transition from transactional purchasing habits to strategic procurement strategies with preferred suppliers, or if you've implemented an order approval process, the spend under management KPI will help you drive cost savings, reduce maverick spend, and improve profitability.
Cost savings is perhaps the most obvious KPI for managing costs and "hard savings" initiatives. The cost reduction KPI measures your historical pricing to your current performance for the same good. Alternatively, if you have awarded a new vendor business, you can compare the costs of purchasing from one supplier against another.
If you're going to choose only one supply chain metric, let it be this one. Monitor supply chain performance and begin holding your suppliers accountable with the perfect order KPI. Assess your vendors' service levels by monitoring their deliveries are on time, in full, damage-free, and accurately documented and invoiced. This KPI supports your three-way match process, safeguards your business continuity by ensuring your suppliers are trustworthy and guards your profits by making sure you pay what you should, for what you got.
Leveraging procurement data analytics to monitor key performance indicators gives you the foundational measurements you need to ensure you are moving in the right direction, finding areas for potential improvements and gaining the advantages you work hard for.Contact us today to see a demo of our dental inventory management software and get a feel for the data you can leverage to streamline your procurement processes!
September 13, 2021
Supplier Relationship Management (SRM) is one of the largest differentiators between purchasing and procurement and can significantly impact your dental practice’s success. SRM is, in big part, about collaborating with preferred and strategic suppliers and nurturing mutually beneficial relationships that support organizational growth.Although we understand employees are stretched and time is limited, when it comes to SRM, a little effort goes a long way in motivating suppliers and arming them with what they need to fight for your business.
Managing your supplier relationships isn’t a one-time task and takes a consistent and concerted effort. However, it’s a process with the potential to extract significant value, and it’s worthy of your time, so let’s make sure you do it right.
In order to ensure you keep your suppliers accountable and avoid communicating conflicting information, assign one person as captain of your SRM efforts. Communication with the supplier should be streamlined through the relationship owner as much as possible, with predetermined backups for when they aren’t available. This avoids redundancy while ensuring the supplier receives a singular version of the truth, avoiding confusion or misunderstandings.Management should work with the SRM owner to ensure you are aligned on strategy and objectives.
You want to kick off or reignite relationships with preferred and strategic suppliers by opening the lines of communication. Invite them in, shake their hand, tell them what there is to know about your dental practice. Share your wins and your losses. Let them know what you’re struggling with and what your long term objectives are. Open and honest communication is the first step in building a foundation of trust.It’s also a good idea that they establish who their critical connections are and that they do the same for you. Your accounts payables and receivables departments should have the proper contacts and anyone who backs up the purchaser when they aren’t available. Effective two-way communication at every level of the business is key to successful long-term partnerships.
If you want to hold suppliers accountable for their actions, you must first ensure clear communication of your requirements. Think both big and small, and include what may seem obvious such as standards of service (deliver on time) as well essential details such as what door they should deliver to, between what hours, and to whose attention.You’ll also want to ensure you bring to their attention any processes they will be expected to follow (such as Methods cloud-based dental supply RFQ process), or if you would like them to come in for a quarterly review armed with delivery performance data.
Trust is an integral part of any relationship, and SRM is no different. Build trust through transparency, honesty, and follow-through. Salespeople are people too, and their success and livelihood depend on the trust they put into your company.
Mutually beneficial relationships stand the test of time and draw healthier outcomes. Your supplier’s ability to meet your demands and bring you their best service and pricing relies on collaborative efforts. Set your suppliers up for success by making sure the conversation is a two-way street. Listen and be responsive to their concerns, and whenever possible, meet your supplier’s needs and do what they ask of you.
Whether it’s cost savings initiatives, lowering inventory levels, or implementing a new request for quote (RFQ) procedure, suppliers should take an active role in your improvement objectives. Have a progression strategy and set clear targets and action plans to progress them along the preferred and strategic vendor growth path.Collaborate with suppliers to establish KPIs and a monitoring plan. Remember to keep it real and set realistic objectives with a clear action plan.
Suppliers who continually work hard to gain your business should be rewarded in kind. Whether formal or informal, a progression strategy should be set in place and communicated to suppliers. If your procurement practices to date have been mostly transactional, you should have a plan to strive to select tactical, preferred, and strategic vendors. This is an ongoing process as suppliers may gain and lose favor depending on performance.Be honest. Let your suppliers know where they stand, where you think they can get to, and how.
The ultimate goal should be a formalized, quantified, and data-driven supplier performance evaluation using standardized metrics and a vendor scorecard system. In actuality, however, those sorts of processes may be a long time away. The important thing is to communicate issues in a timely manner and periodically set a time for an informal discussion to review both service and pricing performance.You should be ready to discuss pricing competitiveness, order delivery, invoicing issues, response time, and frequency of contact. Discussions should end on a positive note and with a clear improvement plan.Remember, don’t be afraid to say the hard things. Your suppliers can’t fix what they don’t know is broken, clearly communicating issues and giving them a fair chance to do better before they lose business is fair game, and they will appreciate your efforts.We can’t lie; being proactive in managing your supplier relationships can take considerable effort, but passive procurement that lacks strategy can be a costly habit. Put in the time and the action, and your dental practices EBITDA will thank you for it.
Once upon a time, purchasing was thought to be about little more than “beating up” suppliers and playing hardball to knock down prices. And although it would be fair to say that some of this still happens, procurement today is more inclined to take a more mindful, long term thinking approach. Open, honest, mutually respectful, and beneficial relationships make for more fruitful business partnerships.Just like in a marriage, in supplier relationship management (SRM,) what you don’t do can be just as important as what you do do. It’s important to remember that paying close attention to your procurement practices improves your dental practices bottom line.So let’s dive into the most crucial things you want to make sure to avoid.
Maintain objectivity and integrity and abide by fair play with no preferential treatment or acceptance of bribes.
With such a large market base, it may feel like suppliers are a dime a dozen, but like the right life partner, a good supplier is hard to find and should be valued.
The lack of best practices within the dental procurement industry has left the door open for suppliers to take advantage of. Ensure you understand the importance of the three-way match and have a discussion with your suppliers if problems arise.
Do what you can, and you’ll be surprised how little effort it takes and how quickly you’ll see results that should lighten your workload and calm your woes while improving your profitability.
Set the standard of what your organization is and isn’t willing to accept by being vigilant and dealing with issues head-on when they arise. Whether they are a transactional or strategic supplier, you must hold them accountable if you want to see improvements.
Ensure they are fact-based and not based on unconfirmed hearsay.
Instead of always approaching suppliers with specific requests, ask them to show you what they can do for you and others aren’t doing. Remember, even small improvements add up to considerable savings in the course of a year. Whether they improve your payment terms or waive shipping fees, if they want the volumes that others aren’t getting, they should be willing to do what others aren’t doing.
Communicate any new or upcoming changes to your preferred suppliers as clearly and soon as possible and give them some time to get their ducks in a row.
Long-lasting and effective change takes time to implement. Be realistic in your goal setting, and don’t let the fact that you may be tight on time or resources detour you from getting started. Doing something is always better than doing nothing, and you may be surprised how far a few quick, open, and honest discussions can go.Your business isn’t any suppliers given right, and competition is healthy for maintaining long-term cost savings and improvements. Don’t allow strategic suppliers to remain in that position indefinitely. Strategic suppliers should set the bar for other suppliers trying to gain your business and continually work to maintain and deserve your business through superior service and pricing.To develop a cost-reducing competitive environment, and get the most out of your suppliers, ensure to shake things up once in a while, and allow new prospects to show you what they’ve got.
Although it may seem like a long list of “do’s” you don’t have time for and “don’ts” you fear you’ll forget, the key to improvements is always keeping it real with small incremental improvements over time. Our Client Success team is here, at the ready, willing to do our part in helping you establish your processes, educate employees, and improve your ways of working. So let us know where we can help.Contact us today to schedule a free demo or ask any questions you have!
September 7, 2021
With improved procurement processes and best practices comes lowered costs and improved efficiencies, which ultimately increase the valuation of your dental organization.Let us explain. EBITDA is a business metric that gauges a business’s operating performance and is widely used by prospective buyers in evaluating your dental practice or DSO. The acronym stands for:
E=Earnings B=Before I=Interest T=Taxes D=Depreciation and...A=Amortization
EBITDA removes fluctuating factors (such as taxes which may vary from period to period or depending on conditions) and non-cash expenses (like depreciation). Because of this, it is often used by investors, shareholders, and analysts for evaluating a company's performance before the impact of accounting and financial deductions thus enabling an “apples to apples” comparison.
Essentially, if you’re looking to appeal to buyers, your EBITDA matters as boosting your EBITDA boosts your valuation. So, how can you improve your EBITDA, and thereby improve your valuation? Let’s start with how you calculate it.
It’s simple really. Go to your income statement and balance sheet to find all the numbers you need. Take your total revenue, subtract all of your operating expenses but not your depreciation, amortization, interest, or taxes, and you’ve got your EBITDA.
However, let us take a minute to point out that although EBITDA is an important metric you want to be monitoring, and improving, it is only one tool and is not meant to be the sole measure of a dental practice’s performance or value. Yes, EBITDA can help determine the profitability of your dental operation and allows for easier comparison to other dental practices or DSOs, a valuable tool for possible investors when deciding if your dental practice is worth investing in.
But, it’s important to note that two dental practices or DSOs may be equal in EBITDA, yet one may be more profitable due to debt expenditures or tax structure. EBITDA is but a starting point. Other factors are then considered to gain a better understanding of the impact of things such as debt, capital expenditures, and taxes on the overall enterprise value of your practice.
Nonetheless, it’s a very important metric you should be keeping your eye on. Recognizing the importance of EBITDA, begs the question “How do I increase the EBITDA of a dental practice or DSO”? Improving the procurement process in your dental practice or DSO is a powerful and often underutilized path.
Did you catch the “subtract all your operating expenses” we mentioned above?
The lower your expenses are, the less you subtract and the higher your EBITDA. Strategic procurement that leverages your purchasing power, is grounded in best practices, and powered by digitization drives efficiency and lowers the cost of doing business.
As we mentioned in Effective Dental Procurement; The Impact of Buying Smart, many dental organizations tend to focus on increasing revenue to improve profits, while overlooking the fact that lowering expenses (including labor costs) has a much greater impact on profitability and EBITDA.
How much greater?
According to Supply Chain Dive, “A substantial increase in EBITDA can be associated with cutting supplier costs, with a 10% reduction generating a 32% surge in EBITDA”.
Based on the industry averages for a dental practice or DSO, every dollar you save in procurement equates to nearly three dollars ($2.94) in additional production. Dental practices and DSOs are commonly sold for a multiple of EBITDA that ranges from 4 times EBITDA, to (in some rare cases) 15 times EBITDA or more. Based on today’s dental practice and DSO valuation multiples, every $1 saved on procurement can add $5 - $15 to your practice's value.
Use our handy calculator to determine the impact procurement savings can have on your practice. This is why a well-developed Procure-to-Pay (P2P) process (the process that begins with the knowledge that you require a good or service to the payment of the invoice), ensures you have what you need when you need it, and is the backbone of organizational health and improved profitability.
Best practices are, well, best for your business. These standards were created in order to close loopholes and ensure you are following the basic processes that are good for your dental practice’s P&L.
Let’s take a look at a few of the fundamentals that drive better financial results.
Price creep is the erosion of the hard fought discounts you have negotiated through your suppliers. Price creep typically takes the form of small increases, often without notification to the dental practice or DSO, that are likely to go unnoticed.
However, they are implemented regularly enough that when gone unchecked, they can end up making a significant difference to your bottom line. These seemingly small discrepancies can quickly add up to some significant losses.
Recognizing this risk, many practices have implemented their own system to try and catch these increases. Some practices track every dental supply purchase on an excel spreadsheet while others compare prices with multiple suppliers on every order. Technology available today (like Method) supports the principles underlying these time intensive legacy processes, in a simplified and more efficient way.
If a dental supplier quotes your practice on a product, a set of products, or all your products, procurement software (like Method) will store those prices and quote expiration dates. When a purchase order is created the quoted price will appear on the purchase order until the expiration date of the quote. If the supplier does not honor the quoted price, the 3-way match process will identify the discrepancy and the invoice will not be paid until an off-setting credit is issued.
Good inventory management is the framework you need to get it “just right.” Keeping enough inventory on hand for production requirements while avoiding the hefty costs and repercussions of carrying too much stock, such as impeded cash flow and assuming financial losses from expired inventory. It is the framework that allows for streamlining and improving the procurement processes that lower your cost of supplies and improve your profits—making them every bit worth doing.
In most dental practices and DSOs, the office staff responsible for purchasing supplies and services have a host of other responsibilities demanding their attention. Procurement is typically rushed and often frustrating.
A lack of an established process combined with high usage volumes and a long list of supplies can be cumbersome and overwhelming to deal with. Poor inventory processes frustrate employees as they fail to locate supplies or know what needs to be purchased, wasting both time and money.
Reliable inventory control alleviates these pain points while also affording you more accurate financial reporting. Additionally, streamlining your procurement processes frees up your employees for other tasks.
In contrast, standards-based procedures make it easier for new employees to be trained in procurement while ensuring all valuable information is retained and easily accessible, regardless of turnover.
It sounds simple.
However, when it comes to dental supplies, without the right platform, it’s difficult to garner visibility on market pricing so you can make the best buying decisions.
Asking for quotes, tracking, and comparing responses is extremely time-consuming when it’s a manual process. Digitizing procurement makes all of the difference. That’s why Method scours the internet, bringing you all the data you need to your fingertips.
Much like shopping on Amazon, you can simply shop for what you need and buy at the best possible price. Even if you go no further, this one step can bring you significant savings.
Of course, we also provide you with robust data and analytics, empowering you to leverage your spend, create a sourcing strategy and negotiate even stronger pricing.
Digitizing the procurement process allows you to streamline processes, build efficiencies, enable collaboration amongst geographically dispersed teams while gaining insights and control of an essential business function.
Simply put, digital methods uncomplicate the complicated, leaving less room for error and more time for you to focus on making strategic cost-saving procurement decisions.
In the end, it’s really about being smart with your money, and that’s just smart business.
From its inception, we developed the Method platform specifically for dental practices. Method integrates the most critical components of procurement best practices into a workflow that simplifies life for your team.
Every action inside of Method’s platform has been thoughtfully designed to control your spend and drive results to your bottom line. From digital inventory management to easy price comparison, and streamlined ordering Method takes the guesswork out of procurement.
Learn how we can improve your practice with our proven procurement process today.
August 30, 2021
As we’ve said before, when you are fighting to achieve maximum cost savings, every penny counts, making it easy to get carried away. Unless you’re careful, aiming to purchase every item at the lowest possible price or waiting until the last possible moment can, in the end, cost you more.Although procurement's goal should be to strive for improvements in all three areas, price, quality, and service, by implementing the right dental procurement strategies, there is no avoiding that often one must be sacrificed for the other. Rush deliveries and high-quality name-brand goods come at a cost.The more realistic goal should, in fact, be to purchase the right items at the right time and at the best possible price. But knowing just what is “right” for your dental practice requires a clear picture of what’s important to you.Therefore, setting your values, knowing your risk tolerance, and communicating them to those who drive your daily purchasing decisions, ensures they make the right decisions for your dental practice.
Firstly, you should be clear to set a standard of service that you simply aren’t willing to sacrifice. Any company you are considering purchasing from should be proven to deliver the right product, in the right quantities, on the right day, in good condition, and with accurate paperwork invoicing. If you’re not there yet and have a low tolerance for risk, this should be your first goal, as anything less puts your business continuity and profitability at risk.Over and above this, suppliers can help you manage your purchases by keeping on top of your orders and advising of any possible delays or shortages, or showing you better ways to amalgamate your orders for savings. They should also keep you abreast of new products available on the market and offer cost-saving opportunities such as transitioning to private label or other lower-cost options.However, just how much you actually value your sales rep’s “value-add” babysitting services is up to you. Know where you are, what you want to strive for, and where service sits on your list of priorities.
Some dental practitioners are keen on following a formulary or using specific name brands only. Others are happy to save on costs and use private labels. Your employees should know where you stand and what you’re willing to consider for cost savings.Keep in mind, if you are looking to possibly move to a new product, to mitigate the risks to your dental practice, trial and testing procedures are highly recommended.
Of course, price is always at the top of everyone’s list. You want the best possible price, and we get it. But life is more complicated than that. Do you have the cash flow required to purchase higher volumes to save on cost? Are you willing to give up that name brand and move to a private label? Do you have the labor resources to split up orders and purchase every item from the lowest possible source, and if so, does your procurement person understand and know how to calculate the hidden costs that may bite your bottom line?
Every day your employees are charged with making the right calls for your company. However, clearly defining and communicating your values, and setting any necessary purchasing “rules” or processes helps guide those decisions and sets your employees, and your dental practice, up for success.That’s one of the reasons we created our cloud-based inventory management software that allows you to keep track of what you’re getting from your suppliers to hold them accountable. To see this in action, simply request a demo and one of our representatives will schedule a time to talk through the possibilities with you!
August 23, 2021
We aren’t all master negotiators. In truth, many of us find negotiating better pricing to be awkward and intimidating. However, cutting your dental supply costs doesn’t necessarily mean sitting your vendors down and beating them up on price with highly tuned skills and aggressive negotiating maneuvers.In the world of dental procurement, practices may often find that those responsible for the buying of supplies feel out of their depth. With little to no tools to handle the complexities of procuring the long list of highly specified items that dental services require, your employees may be drowning, fighting to manage your purchases, and sinking your profitability along with them.You’re more likely to get where you want to go by aligning your values and objectives with your purchasing strategy, implementing streamlined and efficient processes, and educating your employees on what they should and shouldn’t be doing.Methods cloud-based procurement software is designed to give you the valuable data you need to control your dental practice overhead and create a winning, returns improving strategy.
To create the right competitive environment that breeds improvements and cost savings, you must leverage your purchasing power and manage your supplier relationships in a manner that keeps vendors interesting and working hard for the betterment of your dental practice. Like in your personal life, supplier relationships have different maturity levels and can play different roles.
At the onset of a supplier relationship, most transactions are precisely that, transactional. Depending on the advancement of your purchasing practices, you may have had little if any interactions with the supplier. You source the product, perhaps online, place the order, likely with no negotiating, they deliver, and you pay.
In a tactical relationship, through meetings and discussions, you have established their capabilities and service standards. You have put some effort into building or at least initiating a connection and have provided them with some knowledge of your business, and perhaps given them an idea of your dental supply requirements.
A preferred supplier has some prior history with your company and has demonstrated their abilities to the point that you now prefer to purchase from them over other suppliers. At this point, their pricing should be known to be competitive.
Strategic suppliers are awarded a significant portion of volume through long-term collaborative efforts, proven superior service, and top pricing.
Suppose you’ve put little effort into your procurement practices and are “awarding” all of your business to transactional suppliers. As you progress along your path to better procurement, the goal should be to start seeing this slowly flip on its head by monitoring service levels and pricing while cultivating relationships with the right suppliers.You’ll want to give thought to how many suppliers you want to keep in the mix and how you want to disperse your volume. However, in many instances, juggling three to four suppliers (one at every level) creates just the right competitive environment. You want to ensure to give suppliers enough volume to keep them interested in your business and hungry for more.Of course, there are more do’s and don’ts, as well as ethics to uphold. Supplier relationship management should align with your company values and objectives. But the take-home here is this, regardless of who manages the day-to-day procurement or how much negotiating skill your company has ready to deploy, cost savings can be achieved simply by doing your homework and setting the right strategy. Pin them against themselves and let them go to battle because your business deserves to be hard-worked for, and your profitability depends on it.
While nothing can replace the human to human element of communication that the negotiation of your supplier prices needs, software can help you keep track of it all to make sure you’re getting what you’re paying for and you’re paying the right price for what you’re getting. Method’s cloud-based software helps you keep track of all of your procurement strategies, inventory, and more. Contact us today to see a demo and talk to a representative about how our software can revolutionize the way you purchase dental supplies for your practice!
August 16, 2021
