On Thursday, Nov. 17, Kelly Rodriguez, Zone VP, Strategic Business Unit at Toshiba America Medical Systems, led the latest broadcast in an ongoing education series aimed at improving the healthcare capital equipment procurement process. The broadcast recording is now available for viewing.
Tom Derrick, OpenMarkets Co-Founder and Senior VP, joined Rodriguez for the 60-minute broadcast, which delved into how a lack of transparency, access, and understanding creates inefficiency on the supplier side and increases the cost of equipment. The two also discussed details about how inflated this cost is, and what actions both providers and suppliers can take to work more effectively together to improve the bottom line for both sides.
The healthcare equipment market, Derrick said, is $30 billion, a figure that is bigger than many think. Another notable statistic shows that Selling, General and Administrative Expenses (SG&A) average 51 percent. This is an obvious and large issue that is worthy of being solved.
SG&A is higher for more technical products, such as MRIs, as these products are more expensive and more stakeholders are involved in negotiations, said Rodriguez. Communication between providers and suppliers must be clear, or the process will take longer and prices will increase.
Suppliers in particular, Rodriguez said, must be prepared to ask questions. A true understanding of pain points is critical, as is the ability to be a true partner during the process. “Don’t just show up and throw up,” she said.
Both Derrick and Rodriguez urged providers to share funding status and to publish the entire capital budget. This transparency drives competition, and allows for creativity.
OpenMarkets is working on new ways to drive down supplier SG&A, and to bring relief to both provider and supplier pain points. We’re committed to lowering supplier SG&A and continue to chip away at both provider/supplier pain points. Stay tuned for updates and news about new products!
OpenMarkets Healthcare Supply Chain Broadcast Series is aimed at educating healthcare providers on how new processes and intelligence can be utilized to save valuable time, better collaborate with suppliers and maximize their capital budgets. Click here to view the newest recording.