By now, you should have a good idea of how to focus your attention on the quick wins building a plan to save your practice money. However all of this work will be irrelevant if you don’t successfully analyse suppliers. Most practices will only compare product costs, but suppliers become savvy to this process. Stationery and housekeeping are prime examples of categories where suppliers will introduce “loss leaders”. These are products with prices so low that encourage practices to buy from them. But the moment you need something that wasn’t originally quoted, you’ll end up paying through the nose.
In order to effectively analyse a supplier you need to need to take into account 4 key areas. The first and the most important is known as assurance of supply. This asks the supplier whether they can deliver what they say they can deliver? Is there any risk of this supplier not meeting your needs? If you’re happy with this, you can then look at the quality of their products and the level of service. Again if this meets your needs look at whether they have flexibility and can they react to your changing needs? The final part is then of cost and the savings they can deliver your surgery.
By evaluating in this order you’ll have greater market awareness and knowledge of your suppliers. By the time you get round to looking at price, all you need to focus on costs which means you can use a more commercial negotiation process which we will look at next week.
