Three Months to Onboard a Glove Supplier: Why Medical Supply Vendor Management Is Broken

The office manager at a two-dentist practice in Adelaide pulled out a stack of invoices and spread them across her desk. “I need you to look at this,” she said.

She had been ordering the same composite resin from the same supplier for four years. The pricing agreement she had negotiated in year one specified $42.50 per syringe. She had never re-verified the price. When she finally checked last month’s invoices, the price was $51.80 per syringe.

The supplier had increased the price three times over four years — each time with a small notice buried in a monthly statement that nobody read. The practice was consuming roughly 15 syringes per week. At a $9.30 per syringe overpayment, the practice had been paying $7,254 more per year than their negotiated rate — on a single supply item.

When the office manager called the supplier, their response was matter-of-fact: “We sent price adjustment notices each time. The new pricing took effect when you continued ordering.”

The office manager had not seen the notices. She did not know the pricing agreement had an escalation clause. She had no system for tracking vendor pricing against agreed rates. She had assumed — reasonably, she thought — that the price she negotiated was the price she was paying.

She was wrong. And she was not unusual.

The Supply Cost Blind Spot

Supply costs are the third-largest expense category for most medical and dental practices, after staff and facility costs. Yet supply management receives the least attention. Practices negotiate clinical service fees with payers. They benchmark staff salaries against market data. They review lease terms before renewal.

But supply orders? The office manager or clinical lead orders what they need, from the vendor they have always used, at whatever price appears on the invoice. The ordering process is driven by habit, not strategy. And nobody verifies whether today’s price matches yesterday’s agreement.

The Vendor Onboarding Problem

Adding a new vendor to a medical or dental practice should be straightforward: compare pricing, evaluate terms, place a trial order, and transition. In practice, it takes weeks or months because the process has no structure.

The evaluation stalls in the comparison phase — the practice requests pricing from the new vendor, but the comparison against current vendor pricing requires someone to compile a list of items, pull current pricing (from invoices, not from any tracking system), and create a side-by-side analysis. This task sits on the office manager’s desk alongside fifty other priorities. Weeks pass. The new vendor follows up. The office manager promises to “look at it this week.” More weeks pass.

Meanwhile, the practice continues ordering from the incumbent vendor at whatever price is being charged, which may or may not be the best available price.

The Hidden Costs of Vendor Inertia

The biggest supply cost at most practices is not the price of any individual item. It is the cost of inertia — continuing to order from the same vendor at escalating prices because switching feels like too much work.

Vendor inertia manifests in several ways:

Price creep. Suppliers increase prices incrementally — 3-5% per year. Over five years, the price of a common item can increase by 15-25% without anyone noticing because no single increase was large enough to trigger attention.

Volume discount erosion. Many pricing agreements include volume tiers. If the practice’s ordering volume decreases (fewer patients, procedure mix changes), it may quietly drop to a lower tier with higher prices. The supplier adjusts the pricing. The practice does not notice.

Competitor pricing evolution. The competitive landscape for medical and dental supplies shifts continuously. A supplier that was price-competitive three years ago may no longer be. Without periodic comparison, the practice has no way to know.

Product availability assumptions. Practices avoid switching vendors because they assume the transition will be disruptive — orders will be missed, products will be different, staff will need training. In most cases, the disruption is minimal. Supply distributors are accustomed to onboarding new accounts and can typically match product lines item-for-item.

The Ordering Discipline

Beyond pricing management, vendor onboarding creates an opportunity to improve ordering discipline. Most practices order reactively — someone notices they are running low on a supply item and places an order. This creates several problems: rush orders cost more, out-of-stock situations disrupt patient care, and nobody tracks ordering frequency or quantity trends.

Structured ordering — placing standing orders on a regular schedule for predictable items, with defined reorder points for variable items — reduces costs and eliminates stockouts. Automation can support this by tracking consumption rates: “You ordered 60 boxes of gloves last month and 45 the month before. At this rate, you’ll need to reorder by the 15th to avoid running out.”

The practice that manages its vendors actively — tracking pricing, monitoring agreements, comparing alternatives, and ordering strategically — converts supply management from an overhead cost centre into a source of margin improvement. The savings are not dramatic for any single item or any single order. They are cumulative, compounding, and significant over the life of the practice.

What Changed at the Adelaide Practice

The office manager implemented three changes: a pricing agreement register with automated expiration alerts, invoice verification against agreed pricing, and an annual vendor comparison on their top twenty items.

In the first year, she recovered the composite resin pricing discrepancy ($7,254), identified two other items being charged above agreed rates ($2,100 combined), and negotiated a 6% reduction on her highest-volume supplier by presenting a competitor’s quote.

Total first-year savings: approximately $12,800 — on a supply budget of $68,000. An 18.8% reduction achieved not by cutting quality or quantity, but by paying the prices she was supposed to be paying and verifying that the market had not moved past her current agreements.

The system took four hours to set up and requires roughly thirty minutes per week to maintain. The return on that investment is not just financial — it is the confidence of knowing that every dollar spent on supplies is a dollar that was verified, compared, and justified.