As a dental professional, you want to provide the highest quality care for your patients. However, if you regularly purchase the newest equipment and technology for your dental practice, you may be overspending. 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 practice to set financial goals over a defined period and maximize profits. They provide a financial guide for your practice so you can be sure you're only spending when you need to.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 practice.
An essential part of budgeting is understanding your current spending, 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:
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 to only have the inventory you need. Efficient inventory tracking can demonstrate when to reorder supplies or identify where staff may be keeping extra supplies. Keeping accurate records is crucial for analyzing which instruments and materials are most important for your practice's daily operations. You'll both best understand day-to-day operations in addition to when to order more stock.Stockpiling extra inventory in your office can impact your bottom line as well. Order too much inventory rather than using what you already have increases costs and creates bloat both physically and operationally. You should only order stock you'll need for a month, 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 to 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. 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 practice 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!
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.