Organize Your Dental Inventory To Lower Costs

Your overhead is rising and lower insurance reimbursements are changing the dental market and the first knee-jerk reaction is to find cheaper prices for supplies, right?    So, your next step is to get on the internet to find supply pricing that fits your budget.   However, doing so can lead you into the shadows of gray market materials and actually increase your processes which raise your hidden costs.  Some hidden costs can include paying multiple vendors, lost efficiency in ordering processes which are elevated when staff turns over, and lost buying power through a vendor that also takes care of your maintenance, equipment and overall needs. 

Recently, I met with a dental assistant who replaced someone who had been there for 20 years.   Her job was to continue the ordering processes as the person she replaced.  Supplies were tagged and hidden in drawers in all locations throughout the office.  Now,  I am not saying this is a bad system, but is it most efficient for the office?  It mostly worked for the previous team member because the system was hers and everyone had to go through her to make it work.  Unfortunately, the team member who is now tasked with ordering is uncovering years and years of inefficiency.  So...where does this office go from here?  

There are many levels of solutions that require answers to these questions below:  

• How do we create a system that is easy transferable and understandable?
• How do we create a transparent inventory system that is easy to tell what needs to be ordered? 
• How do we create lower overhead costs and create better efficiency?
• How do we make ordering easy with all of the other tasks that need to be completed to meet OSHA standards in turning a room around and keeping the schedule on time? 
• How much do we want to spend to create the ideal inventory system?  

Let's look at examples.   

Unorganized Chaos!  

This example shows little to no organization.  Most likely, the one person that is tasked with ordering is both placing and grabbing from the spot where only they know the location of that item.  Others that are having to locate an item most likely are fumbling and wasting time trying to locate an item they need quickly.  

Clean and Organized, yet Transparent?

In this example, there is more organization.   There is a place with labels that contain a barcode.  The person ordering would scan the barcode of the item that they wanted to order.  Once all items are scanned, they are transferred into an ordering software, such as Breeze by Atlanta Dental.  All items, with a click of a button, are then sent into shipment which the office receives the next day.   This typically utilizes current cabinet or closet space with almost no cost.   The only drawback to this efficiency is that it is somewhat difficult to see if there are items actually in the bins.  

  Clean, Efficient and Lower Overhead

Imagine a sterilization center so clean that you want to show off to your patients so they know your sterilization methods.  When patients see the efforts that you put into their safety, they end up telling their friends which help with internal referrals.  This inventory system uses the same barcode system in the previous picture.  However, they also utilize a more central space with clear tip-out bins that help make ordering clear and concise. 

Earlier, the example of the assistant who was given the task of taking over the ordering from the team member who had her own system for 20 years was interviewed to reveal the progress after making these simple changes.   Before, they were ordering from 12 different vendors.  They had no centralized storage and stuffed items in drawers throughout the office.   Together, we created:

•  a centralized storage area to quickly identify items that need to be ordered
• reduced the number of vendors which increased the buying power of that office with the select few trusted companies 
• implemented a barcode system that made ordering quick and easy giving this office a system that is easily transferable in case the ordering duty was passed along to another team member
• implemented the 80/20 rule of ordering (click here for the 80/20 rule of ordering). 

I urge you to read the 80/20 rule of ordering to help lower costs.  When meeting with offices and listening to their challenges, efficiency is a constant theme.  Why is efficiency so important?  It's a loose term that is thrown around, but rarely defined (or executed for that matter) to accomplish a greater good.  Efficiency is defined by Wikipedia as:

"Efficiency is the (often measurable) ability to avoid wasting materials, energy, efforts, money, and time in doing something or in producing a desired result. In a more general sense, it is the ability to do things well, successfully, and without waste. In more mathematical or scientific terms, it is a measure of the extent to which input is well used for an intended task or function (output). It often specifically comprises the capability of a specific application of effort to produce a specific outcome with a minimum amount or quantity of waste, expense, or unnecessary effort. Efficiency, of course, refers to very different inputs and outputs in different fields and industries."

Now that we have defined efficiency, lets explore how we can apply it to the dental office.   An office typically contains doctors, dental assistants, hygienists, office managers, front office team members, etc.   The doctor, whom is typically the owner, has to perform the direct service to the consumer (patient) as well as manage a team with different experiences and backgrounds.   This  amalgam (yes..pun intended) of the dental team is the input of production.  Meaning, the collective efforts of their work is the input and the output is measured by relationships, monetary production, profitability, and overall practice ambiance.   When turnover happens (a team member resigns or is fired), typically that person that replaces that team member is thrown into the fire and is in a sink or swim mentality.  Often, the onboarding of training is the habitual processes of what the practice has always done to get that team member quickly up to speed. 

By making these simple, yet effective changes, a dental office can recognize substantial dental supply savings which will help in the new normal of lower insurance reimbursements.  The adage - "Don't believe everything you read on the internet" can hold very true in the world of dental supplies.  If your dental office needs some supply revamping, your trusted dental supply rep has the ability to save your office money and create an efficient ordering system. 

            Jacobsigmon@atlantadental.com

Jacob Sigmon is a territory specialist in Savannah, Georgia and serves the coastal Georgia area. He has over 15 years of dental management and has helped set up over 50 practices.  Employed by Atlanta Dental Supply, Jacob is a shareholder of the employee owned company.  His responsibilities include helping dentists with all aspects of their business as well as helping Atlanta Dental grow stronger for the future.  He also started coastalhygiene.com and atlantadentalrep.com.