March 11, 2015
Contact lenses are the most common product ECP practices purchase through buying groups, according to the 2014 Vision Council VisionWatch Buying Group Report. Some 77.2 percent of practices say they purchase more than 75 percent of the contact lenses they sell in their office from a buying group or alliance. Some 45.7 percent purchase more than 75 percent of their optical laboratory services through a buying group or alliance, and 39.4 percent say they purchase more than 75 percent of their prescription lenses from a buying group or alliance.
Some 39.2 percent say they buy more than 75 percent of the cases they stock in their office from a buying group or alliance, and 38.8 percent purchase more than 75 percent of the ophthalmic frames they sell from a buying group or alliance. Some 38.7 percent purchase more than 75 percent of the cleaning kits/repair kits they stock from a buying group or alliance, and 36 percent purchase more than 75 percent of the plano sunglasses they sell through a buying group or alliance.
Are you maximizing your buying power by utilizing a buying group or alliance for your product purchases?
The chart below shows data from the 2014 Vision Council VisionWatch Buying Group Report where practices are purchasing 75 percent or more of the following products through buying groups or alliances.
As much as possible, you should never purchase products at the highest price. Your goal is to get the best discount to reduce your practice expenses as much as possible. If your practice is not doing enough business to get the best discount, then you should utilize a buying group or alliance.
Your action plan for this week is to review your buying protocols. Are you getting the best discount possible for all of your practice purchases, or are you leaving money on the table because you are buying items at the one-unit price, and have not explored better pricing options?
Start by asking the manufacturer or laboratory directly for the best discount. Don’t stop after asking them for the best discount they can offer, but then also ask them for help in obtaining the best discount from any source. Often they can lead you to the best source for the best discount. The best discount is often a buying group or an alliance.
Then, check directly with buying groups and alliances. Beware that many buying groups and alliances have preferred vendors. The best price for every product you use in your practice is often not available from a single buying group or alliance. If you do not want to change your buying habits to conform to a single buying group or alliance, then you need to explore the cost/benefit ratio of utilizing multiple buying groups or alliances. This is not always the best way to go because within a single buying group or alliance, the best pricing is often given for the highest utilization. That means if you are splitting your buying between two different groups, you may actually be hurting the potential discount you could have received if you had done all of your buying for your practice from one group.
In today’s world of tight margins, you must control your costs by making sure your practice is getting the best discounts possible. The time involved in taking this action this week is definitely worth the investment.
