Is your practice getting the best price on brackets? How about that new CBCT you’re eyeing? Or what about office paper? If you have a large multi-doctor, multi-office practice, you may have the purchasing power to negotiate a good deal or be able to purchase at such a volume as to see a discount. If your practice is on the smaller end of the scale, well, you might not be getting the same deal.
But size isn’t the only factor here. You also have to look at who is responsible for your ordering. Ask yourself, does the staff member in charge of ordering in your practice have the negotiating skills to get the best deals? Do they even have the time to look for the best price on everything your practice may need?
The reality is supply costs are going up and keeping them in line is all the more important as practices struggle to compete in a more competitive market.
“A lot of the time, doctors focus on the brackets and the bands; then the other things they use one time and throw away are not really watched,” says Mari Sawtelle-Dunn, founder and lead consultant for Mari’s List, an orthodontic buying group. “Often they pay too much and don’t realize why their costs are going up.”
One way for practices of any size to keep those supply costs in line and get a better deal is to join a buying group like Mari’s List.
Started in 2012 with just six companies on its roster, Mari’s List boasts 40 companies today—covering everything from brackets, archwires, adhesives, burs, equipment, consumables, software, web design, office supplies, and architectural consultants. From the start, Sawtelle-Dunn made a point of making the buying group exclusive to orthodontists. The reason for that is she wanted to capitalize on the decades of expertise in the orthodontic sector that she could bring to bear on such a group as they also offer coaching.
Sawtelle-Dunn started as a lab tech and orthodontic assistant and then went on to a career as a sales rep for Ormco Corp and Align Technology Inc, where she was the first sales rep for Invisalign®, and finally to Dentsply GAC. After 25 years on the sales side, she joined a 12-doctor, eight-office orthodontic practice as its director of business development and purchasing. There, she was responsible for not only inventory and developing the formulary for the company, but for negotiating with companies for the best prices for the practice. The practice’s sheer size and the volume of product it consumed allowed her to negotiate fairly large discounts.
“We had an accounting department that entered every single product we ordered. From this information I discovered why orthodontists spend so much on supplies. It’s volume as they have many chairs, team members, and see so many patients a day. When I looked at each item we ordered, and then the category it fell under, the light came on,” she says.
It was out of this experience that she saw the value of a buying group that could benefit both one-doctor, one-office practices and those larger multi-doctor, multi-office practices.
But Sawtelle-Dunn’s familiarity with the orthodontic space goes beyond allowing her to negotiate the best price with companies, it also allows her to provide Mari’s List members with the support they need to fully benefit from the buying group. Members receive a coaching call once they join; and during this call, she and her team offer the doctor and/or staff advice on how to best utilize the buying group. Sawtelle-Dunn prides herself on the expertise and knowledge she has about the orthodontic sphere specifically. She knows brackets, wires, adhesives, coils, archwires, and is always trying to stay on top of new technology.
“I tell doctors when they sign up, it’s not just about price. We are very careful with the companies that we put on the list. We try to stick to manufacturers and distributors with good quality products. We don’t ever want the doctors to have a problem with a product hurting a patient or causing frustration. The great thing is, we very seldom hear complaints with service or quality.”
For orthodontists who want to join Mari’s List, the process is straightforward. Sawtelle-Dunn advises prospective members to visit the company’s contact page on the Mari’s List website and submit their information. Once Mari’s List receives this, the orthodontist will receive a non-disclosure agreement saying the member won’t reveal the confidential pricing of the companies on Mari’s List. From there, the coaching call is set up. Mari’s List then gives the companies the doctor’s contact information and they are coded as a Mari’s List doctor. The practice can then buy directly from the companies. Annual membership is $1,000, plus a one-time $500 setup fee.
As for companies wishing to be included on the list, it’s not as simple as making a call and asking to be added. Mari’s List vets every company added to the list. To join, a company has to offer up front a price that beats what an orthodontist could secure on their own, and one that is better than any AAO special or deal of the day. Many of these discounts are ongoing as a lot of the products are consumable. And these prices are available to both existing members of the group as well as new doctors who join. However, if a doctor has previously and independently negotiated their own pricing with a company on Mari’s List, then the company has to honor those discounts, according to Sawtelle-Dunn.
Companies do not pay to be on the list, nor does Mari’s List take a percentage of any order. “If we negotiate a 10% discount, that discount is passed on directly to the doctor,” Sawtelle-Dunn says. Companies instead benefit from Mari’s List’s marketing efforts.
And as to the $1,000 annual membership the practice pays, Sawtelle-Dunn points out that whether you are one of those one-doctor, one-office practices or a huge multi-doctor, multi-office practice, you will see your money recouped. “It’s like a gym membership,” she says. “You pay a yearly fee—about what a gym membership would cost. And just like a gym membership, the more you use it, the more you can save and the more value.
“Some doctors, they pick a few products and a few companies; where others will dive in and go to a lot of companies on the list and save. It’s totally up to the doctor.”
And if a doctor loves their bracket or adhesive but that company isn’t on the list, there are still plenty of ways to save, says Sawtelle-Dunn. “I tell doctors, ‘If you’re happy with the service and the price and the company and you don’t want to change, then look at other places [where you can].’” For example, office supplies—a category that is often overlooked. Mari’s List offers its members a premium discount through Staples®, which also owns OfficeMax® and Office Depot®.
“The feedback I’ve gotten from doctors in the group is that they’ve saved $10,000 to $20,000. I’ve had people say they’ve saved $50,000 or more. So it’s not hard for an orthodontic practice to save $1,000,” she says. “Some doctors are fine saving $10,000 or $20,000. They don’t want to change everything. That’s good. I have others who really want to dive in and do more. It’s up to them.”
In the end, the goal of any buying group is to get those supply costs down.
“I talked to a doctor [recently] who didn’t know what a good supply cost was and they were running at 14%,” Sawtelle-Dunn recalls. Ten percent is the ideal, she says, depending on the categories. And according to Sawtelle-Dunn, some Mari’s List members have been able to get their overhead down to 1% or 2%, which she admits is a huge cut. Still, any cut in supply costs is going to be a huge boon to any practice, whether large or small, and a buying group gives a practice the power to make those cuts a reality. OP