Strategic Outsourcing for Dental Labs
Written by Jeff Noles, posted July 28, 2013 • Blog, Business Advice
At SoundBite Technology we’re seeing more and more small labs adopt selective outsourcing to grow their businesses. These laboratories employ a “general contractor” approach to client management: They own the client relationship but use multiple outsourcing partners, or “subcontractors”, for services such as CAD/CAM milling, full-contour design services, implant expertise, coping manufacturing, etc. Not only are they plugging holes in their product line with outsourced help, these successful and growing businesses are also adopting web-based technologies to save money on phone calls, meetings, and sometimes even manpower. In this post, I’ll explain some basics about outsourcing and how this practice can help grow your lab business.
Figuring Out the Right Product Catalog
To provide a full-service product line you first need to learn what your dentists want. This may involve swallowing some pride and asking hard questions about the restorations you’ve been selling for years. Due to intense product marketing, rising metal prices, and/or lowered insurance reimbursements, dentists now seek specific products. The days when dentists relied solely on their laboratories to choose quality porcelains, alloys, and branded restorations are rapidly disappearing. We recommend taking the time to systematically visit your clients and ask them what they’d like to prescribe to their patients. You’ll soon be able to confirm the “missing” parts of your product line.
How to Find the Right Outsourcing Partner
Once you’ve figured out what products you need from outsource providers, it’s time to look for the right partner. The advantages of outsourcing some of your products are clear: providing a full-service product range, focusing on your manufacturing strengths, avoiding capital-intensive investments, and retaining existing clients. But you can’t sacrifice on quality. Therefore, the first criterion for choosing a partner, whether local, national or overseas, is determining if they can meet your quality standards. Look for manufacturers who demonstrate attention to detail in both manufacturing and communication. Be wary of splashy advertisements with too-good-to-be-true prices because it suggests big volumes and high customer churn. Don’t feel shy about asking for references from existing clients. If their web site is forthcoming with information, they’ll probably be similarly forthcoming when working for you. If the website of an overseas manufacturer contains too many typos or grammatical errors, look elsewhere; it suggests a lack of attention to detail and if they’re making medical devices for the foreign market then they should have the resources to hire a translator. Finally, ask the outsourcer if they provide web-based logins for case ordering and shipment tracking. It’s actually not that expensive, and investment in management software implies a commitment to transparency and communication. The bottom line: confirm the operational attention to detail of a prospective outsourcing partner.
Low Cost Technologies to Manage Outsourcers
Low-cost cloud-based technologies can help manage your partners and can be accessed from anywhere. For dental laboratories the tools you need generally fall under three categories: communication, office efficiency, and workflow management. Instant messaging with Skype (www.skype.com) or Google (https://www.google.com/talk) allows you to get case updates and questions from across town or half a world away. Free Gmail (www.gmail.com) or Hotmail (www.hotmail.com) accounts save money and the stigma of “free” e-mail for your business has largely disappeared. Skype now even has a desktop sharing application for reviewing digital cases or training. For office efficiency, tools for managing shipments, price lists and invoices include services such as Google drive (www.docs.google.com). Dropbox (www.dropbox.com) and cloud storage companies—including Hotmail’s Skydrive (www.skydrive.live.com)—help with CAD/CAM file transfers. An example of free, web-based software at its best is online shipment tracking with UPS or Fedex.
Managing Outsourcing Manufacturers
In addition to managing in-lab manufacturing, web-based lab management software like SoundTrack (www.soundbitetech.com) has special tools for managing outsource manufacturers, and a sliding fee scale makes it affordable for smaller labs. Case management features such as manufacturing countdown clocks, shipment tracking reports, and restricted logins for outsourced manufacturers are particularly helpful.
If you’d like to find out more about how to manage outsourcing, call us at (323) 522-3120). You can also request a free personalized demo to see exactly how SoundTrack can help facilitate outsourcing workflow for you.