Be careful with those year-end buying opportunities, as they may not always be good for your practice. Buying large volumes to fulfill a year-end sales objective brings some risk to you. You are more likely to have excess product sitting around for long periods of time, which makes it more likely that some product will become ‘shrinkage’, especially if you don’t have sufficient space to secure this inventory for that length of time. It also increases risk of product expiring, so make sure that your vendor will take it back if that becomes an issue.
Nearing year-end, it is time to have discussions with your primary suppliers to learn of projected price increases and any other changes to your supply agreements. After discussing these issues with your suppliers, have some additional discussions to inquire what additional benefits such as volume discounts would be available if you make the commitment to purchase the bulk of your product from them. You have last year’s records on which to base projections for this year, so use those to set some benchmarks that might bring value to your supplier relationships. If a supplier knows they can depend upon your business, they don’t have to expend as much marketing and sales funding to your account, so they have every incentive to optimize their relationship with you to make it more valuable to you and them.
Be proactive and communicate with your primary suppliers to explore how you can improve your relationship with them and as a result, improve the profitability of your practice.
