Management Monday: Stock tips
Stock is one of those areas that can get overlooked in practice. I worked at Sainsbury’s Supermarkets for 5 years as a price controller which involved managing all the price changes and marketing for the store. I learnt a great deal from Sainsbury’s about merchandising, which I have continued to use at my dental practice to this day, so here are my top 10 tips.
1) Price margins – Make sure that you do a 3 monthly review on what you are buying your products in for and what you are selling them out at. I still converse with practices that are selling items at a loss, as they have not realised they are being charged more than they used to be. Tepe’s is an area where practices are caught out as these are routinely increased. Margins on net profit will vary for each stock item, but I normally go with 30% to 35% profit as a mean average.
2) The power of promotions – Everyone likes a deal and I focus my deals on interdental cleaning mostly. We know that we want patients to do daily IDC cleaning and for most practices a patient may purchase a packet of Tepe’s until their next appointment if there lucky. I introduced a 5 for 4 multi buy deal on Tepe’s/Wisdom brushes and they fly off the shelves. There are two positives to this, the first is I now order an increased amount of product and I have managed to lower my buying price, which benefits the net profit and more importantly the oral hygiene of our patients has improved because they are doing IDC for longer, due to them having purchased what they need.
3) Stocking the right products – Too many practices stock irrelevant products, you really need to focus on a core key range which is fully supported by the Hygienists, Dentists and Oral health educators. The more focused your range is the more you will sell as endorsement from the providers is key to sales. Another tip is don’t buy normal toothpaste it will not sell just give out samples.
4) Membership – I feel a preferential discount for members on stock is a nice benefit, I advise 10% off for members, but make sure that your team communicate this with every patient, it is nice to hear you are having discount and it costs nothing for your front desk team to do this.
5) Using the right suppliers – Suppliers in oral health is definitely worth a shop around as the profit margins on stock can be obliterated by bad purchases. So keep an eye on deals as it can produce a promotional opportunity.
6) Product Display – Make sure your products are displayed nicely, they should be enticing to buy and stock pulled forward so that is neatly dressed at all times. Do not use cabinets they don’t work and you are not selling expensive jewelry. Patients are used to handling something they wish to purchase, so allow them to in your practice and your sales will increase just by getting rid of an unnecessary barrier.
7) Front desk team – Make sure your team at the front are promoting your offers and actively asking patients if they need anything. I come across too many practices that have dust all over their products and shelves and the front desk team are not motivated to keep the sales area clean and encourage any purchase.
8) Discontinued items – Patient’s can get very upset when items are discontinued it is something I dread especially in a core product line. It recently happened with Glide Floss picks,a particular favorite in my practice. Yes I bulk bought stock and sales have been wonderful for 3 months, but now there is no more or is there? Good news, I have found that DHB are stocking them, slightly different packaging, but hey they are still here and it goes to show, you need to have your eye on the ball.
9) Stock Co-ordinator – Make sure you have someone in charge of ordering stock that is passionate and will keep on top of stock levels . Lost sales can happen because you do not have stock and although there is a fine line between too much stock and not enough it’s something that the Co-ordinator needs to get right.
10) Oral health educators can be very influential in increasing stock purchases especially in children’s dental care and orthodontic patients. It is nice to make children’s purchases exciting, so offer a free gift or do a set children’s pack. Children’s packs should contain disclosing tablets, toothbrush, toothpaste and floss picks. Free gifts I like are sand timers, diet sheets and a suitable toy. Orthodontic packages are defiantly worth providing free of charge at the start of Orthodontic treatment, packs should include, Ortho heads, Tepe brushes and Retainer Brite. The repeat sales will more than cover this investment.
Have fun with stock!
Michael