How Many Distributors Should a Clinic Use?

“We believe, as many as you possibly can.”

The many hundreds of clinics that actively use Vetcove regularly order from, on average, more than five separate distributors. Does having these extra sources really make a tangible difference in terms of cutting costs and increasing clinic profitability? What we’ve found in our time operating Vetcove and talking to clinics, is that it absolutely does — -and in a big way. Here’s why:

1.) Better Product Access: While all distributors carry a few of the most popular big brands, most products on Vetcove (>80%) are only available through one distributor. For each distributor that you add, you’ll have access to more products. Some of these products are a better fit for your clinic and your patients than what is available through your primary distributor — -and some are cheaper, too.

2.) More Generic Options: Each distributor carries a suite of generics, but they vary widely as to which they stock. The price differences for generic drugs across distributors is far greater than branded products. Vetcove clinics have told us that they have cut costs more than 70% on certain popular generics by finding the right source. We’ve found this to be true in our own clinic too. Given similar sale prices to customers, profits increase manyfold when dispensing these drugs. In our view, generic is generic, so why pay more?

3.) Better Average Pricing: Except for mandated fixed-price products, prices vary across distributors, and even within a distributor from one clinic to the next. You might be surprised to find that a distributor you don’t frequently use stocks a product you order a lot of for much less. Over time, and over many products, the savings to your practice add up. No distributor is the cheapest for everything, even if you’re a part of a buying group or are told you’re getting “best tier pricing” from your distribution rep.

4.) Better Leverage: Having access to many suppliers arms a clinic with knowledge about what prices are “fair,” and which aren’t. This allows a clinic to make smarter buying decisions, and to potentially lower average prices at their primary distributors. When your rep knows you’re price-sensitive and will look elsewhere when a price is too high, they’ll do their best to keep their prices low to earn your business.

So, how many distributors should a clinic really use? We believe, as many as you possibly can. In a world before Vetcove existed, having too many sources would add time and frustration to the ordering process. Having too many used to not make much sense, since the time lost would eclipse some of the cost savings. With Vetcove, you get the benefit of all four of the above advantages without the added cost or time that used to be associated with using many sources. For this reason, it now makes sense to spread orders around to many different distributors.