Times have changed.  Has your lab changed?

Our latest blog post examines the reasons why labs continue to buy from one of the two big lab distributors even though:

• Prices go up year after year and savings goals promised are never delivered.
• Service levels go down, year after year. You are told you don’t buy enough to warrant an in-person sales rep. Some companies have even eliminated phone calls!
• Freight charges, fuel charges, handling charges and late payment penalties keep getting tacked on to your bill.

If you don’t want to pay the full, ridiculously inflated list price for an item, you must obtain a quote from someone at the big distributor.  If you aren’t a big spender, this “someone” may be a telesales rep.  Although your account may be assigned to a sales rep who, in correspondence, seems very much on your side and willing to “see what he can do” to get you better pricing, that sales person is facing a lot of obstacles from his or her company, placed there to ensure you do not get a good price.

I invite you to take a look behind the curtain at your big distributor and see how they stack the deck against both you and your representative to boost their profit margins. 

Resistance to Change - How to overcome it.

Lab Managers and owners often set cost savings goals.  The people who work in the lab never want to insert variables into a test they routinely perform.

The people at the bench will nearly always fight to preserve the status quo.  Some will even refuse to purchase an identical product from a different seller. At the bench level, reducing the risk of faulty results takes priority over reducing overall spend.  The incumbent supplier is always there to lend support to this argument.

So why are some labs able to overcome this resistance and do business with other suppliers?

1. A person who has been successful doing business with a different supplier at a different lab comes into the organization.
2. Some performance failure by the incumbent vendor causes a disruption to the lab’s ability to perform testing and generate revenue.  Example:  A major supply chain disruption.
3. An owner or other C-level person puts his/her foot down and mandates change.  Usually, this directive is due to a dispute or a breakdown in negotiations with the incumbent vendor.

Is the choice all-or-nothing?

Have you been told by your current supplier that “you are under contract”?  Have you been told that if you take some business away that your prices on other items will be increased?  Have you been sold on the concept of “vendor consolidation” being the panacea to savings?

All of these are tactics to keep you from looking at other options.

Labs are increasingly looking for better options, better customer services and better prices, and finding them in smaller firms such as LPS that specialize in the small to midsize labs that the big distributors have decided are too much trouble to devote resources to.

We invite you to learn how to take that big step forward in seeing how procurement services firms like LPS can once again provide first-rate service and guaranteed savings.  Schedule a free, no-obligation consultation today.