STANDARDIZE PURCHASING TO REDUCE PRODUCT VARIATION
One way to optimize spend is to One way to optimize spend is to standardize products and medical equipment across the facility. Driving standardization minimizes the variety of items in inventory, which can save money on storage and reduce obsolete inventory.
Standardizing products also enables facilities to buy in bulk, which oftentimes results in a discount in pricing or a favorable rebate. Another benefit is that fewer variances in products leads to more efficient usage, resulting in less waste. Likewise, product standardization can make procurement more predictable and efficient.
Along the same lines, consolidating suppliers can streamline accounts payable processes. Decreasing the number of suppliers and other vendors reduces administrative costs and simplifies managing orders, invoices and payments—keys to actively optimizing spend.
Another benefit of consolidating suppliers is that facilities can better implement quality control measures by efficiently monitoring quality and compliance, resulting in fewer returns. Making larger purchases from fewer suppliers can enable better tier pricing and earn volume discounts. and medical equipment across the facility. Driving standardization minimizes the variety of items in inventory, which can save money on storage and reduce obsolete inventory.
Standardizing products also enables facilities to buy in bulk, which oftentimes results in a discount in pricing or a favorable rebate. Another benefit is that fewer variances in products leads to more efficient usage, resulting in less waste. Likewise, product standardization can make procurement more predictable and efficient.
Along the same lines, consolidating suppliers can streamline accounts payable processes. Decreasing the number of suppliers and other vendors reduces administrative costs and simplifies managing orders, invoices and payments—keys to actively optimizing spend.
Another benefit of consolidating suppliers is that facilities can better implement quality control measures by efficiently monitoring quality and compliance, resulting in fewer returns. Making larger purchases from fewer suppliers can enable better tier pricing and earn volume discounts.
ANALYZE PURCHASING BEHAVIORS TO ENSURE STRATEGIC BUYING
The ability to accurately predict product demand to align with usage, along with following demand management best practices, can lower inventory costs to support spend optimization strategies. Using data to accurately forecast product demand, based on consumption rates, allows facilities to fully optimize inventory.
Facilities able to achieve precision product forecasting and finetune capacity planning can improve usage efficiency and reduce costs, all while ensuring ongoing product availability.
Gathering and analyzing data can do more than help with demand forecasting, too. Analytics can reveal a facility’s buying habits and overall market trends. These patterns allow organizations to better utilize their own facility’s inventory to avoid costly overstocking while simultaneously preventing shortages.
Similarly, facilities can use data and an integrated materials management platform, like Envi®, to gain a complete view into procurement, suppliers and contracts. This view can help organizations identify any potential risk to their supply chains—disruptions often result in product shortages or price spikes that directly impact spend.
Visibility into the supply chain, contracts and suppliers also gives facilities the ability to make more informed buying decisions by looking at factors such as availability, reliability and quality in addition to price.
Managing contracts can help deliver ongoing value by ensuring accurate pricing and switching contracts when needed, based on a facility’s requirements and pricing considerations. Effectively managing contracts makes sure terms and conditions are favorable and cost increases are minimized. Facilities can also pick the contracts that meet their compliance requirements as well as their business and clinical needs, to make procurement and product usage more streamlined.
