Distribution: Practice proactive, not reactive, purchasing

Q. Where did all the crutches go?

A. According to a recent poll conducted by HME News, providers say they’re increasing on-hand inventory levels to try and combat supply chain disruptions. So, when an item like adult crutches goes on backorder with a big-name brand, providers start ordering up and clearing out the warehouses of other manufacturers for fear that they may not be able to procure that item in the short-term, in many cases, doubling the amount of inventory they are carrying on their shelves. They would rather have more capital tied up in inventory than be without product and face the fear of losing referrals and revenue.

As you can imagine, the math adds up quickly when you scale out this type of purchasing increase over thousands of HME locations across the country leading to industry wide product shortages. We’ve seen this occur with many categories over the last 19 months, starting with oxygen concentrators, spiking with CPAP devices this summer, and now spilling over into ambulatory products as we enter the fall. Items such as crutches, walkers with wheels and wheelchairs are now top of mind and on every provider’s short list.

But is this method of reactive purchasing the best path for your business moving forward? I would suggest another option: the power of distribution. Forward-thinking providers who traditionally have ordered direct from a handful of manufacturers are starting to utilize distributors for what they’re experts at – logistics. Finding alternative sources, managing an inventory cushion, warehousing products in bulk and identifying substitutions ahead of time are concepts distributors have been perfecting for decades.

By partnering with a distributor, you gain access to hundreds of manufacturer inventories through one relationship and can easily pivot, should supply chain disruptions ever occur with a specific brand.

Colton Mason is senior vice president at Supreme Medical Fulfillment. Reach him at colton@suprememedical.com or 800-461-1370.