Inventory management is a cost-saving tool for dentists

March 29, 2022

Dentists have been aware of the pandemic’s effect on global supply chains since personal protective equipment became scarce in early 2020. Two years later, dental practices are facing rising costs for all supplies owing to ongoing interruptions to supply chains, soaring fuel costs and inflation. When looking for ways to trim your office budget, the first place you should look for savings is your inventory control system.

Some of the most effective and recommended practices for inventory control are creating a shopping list, reducing redundancy, setting a supply budget and assigning specific inventory roles and responsibilities.

Make a shopping list

One study by the University of Pennsylvania noted that grocery shoppers with lists spent 23% less than those without lists. To apply this grocery list concept to your dental practice, create a “master supply list” and review it at least once a year. A master list can be helpful in educating new staff on the practice’s preferred products and vendors. It can also be used as a guide when comparing prices or considering making changes, along with making your budget more predictable.

Dental association members can leverage collective buying power for supply savings through The Dentists Supply Company. Use the shopping list feature to streamline your list-making and purchasing process.

  • Once signed in, shoppers can access this feature by selecting “Your Account” and “Shopping Lists” from the drop-down menu or by selecting “Add to shopping list” when viewing a product.
  • By choosing “Create a New List,” shoppers can name the list anything that helps them organize their purchasing. Some practices make their lists granular, designating them for “Hygiene” or “Disposables.” Others use a basic strategy and have one list of the items they know they need for a set period, like one month.

Almost all offices have an idea of how many dental cases and hygiene appointments occur in an average month. Thinking about supplies based on usage during a period of time can help your office map out a basic, replenishable supply list. This will minimize redundancy and impulse purchases that can clutter inventory.

Reduce redundancy

To drive further efficiencies in ordering, reduce the amount of inventory storage, lessen the chance of expired products and free up cash flow, dental practices should focus on discontinuing the use of redundant or duplicate products. Here is how this best practice plays out in the real world with products like patient bibs:

Usually, a dental practice needs one box of bibs at a time. The reality is that most offices never have just one of anything, so along with a box of bibs in the treatment area, there’s a back-up box in the supply closet. Assuming these bibs cost $50 per box, you now have $100 in inventory. If someone in the office decides it would be nice to have four more colors of bibs — with accompanying backup boxes — you now have $500 in inventory on the shelf. This equates to $400 less cash flow in the practice due to duplicate purchases.

Redundancy increases risk for expiration issues when outside of the disposables category. Use the Order History feature to search your office’s past order by date or time frame. This feature can be used to identify redundant items before placing an order and without digging through the office supply closet.

Set a supply budget

A supply budget is a simple cost-cutting tool that is often overlooked by dental offices. Without a budget to measure the cost of supplies, dentists often order supplies in quantities that are either too large or too small. This results in either running out and being forced to order a small quantity with rush delivery charges or having more of something than can be used prior to expiration.

A good rule of thumb for inventory costs is that they should be no more than 5–6% of production. If past spending shows inventory costs above that percentage, evaluate your inventory control system. This signals a problem with redundancy, a need to find an alternative product or distributor, or you might need to reassess whether there is a service that’s not profitable for your practice. TDSC allows shoppers to review comparable products’ prices and features side by side to find new favorites and ways to save.

Set roles and responsibilities

Many practices rely on a single point person for inventory control, and the role tends to default to a dental assistant. However, inventory is not a task but rather a system — one that needs the right point person for some processes and the whole team for others. As with most processes, practice leadership must establish, document and assign specific roles and responsibilities.

You may need to have one role or several that divide and conquer. One way to divide and conquer is to assign roles and responsibilities by category with three different trusted team members assessing dental supplies, dental equipment and office supplies. Another way is by department with one person assessing the hygiene department supply levels and another assessing restorative levels. Your point person should then receive requests by a specific day each week, allowing time to aggregate, evaluate and ask questions before placing an order.

A strong control system ensures that supplies make it into your supply closet. Unfortunately, the supply management function is often one of the easiest targets for fraud and abuse since most dentists are too busy to fully monitor what supplies are being used and ordered and what items might be going out the door. Having multiple staff members involved in monitoring and documenting your system is one way to prevent fraudulent use of practice funds.

CDA Practice Support Analyst Matthew Nelson will offer his expertise on inventory embezzlement and controls at CDA’s upcoming convention in Anaheim. TDSC will also be there to offer guidance and support in booth 1223.

Whatever your practice size and structure, establish a process that works for the culture of your team. Remember that consistent practices support your success and be sure to thank your team for helping you secure dental supply savings along the way.


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