Navigating group purchasing organizations (GPOs) can be daunting, whether you’re an individual entrepreneur launching a great innovative product or you’re a small business looking to sign on to a contract.
Our guru on today’s episode of Med Tech Gurus <link> podcast is Dale Wright from Actalur Group. Listen in as Dale leverages his many years of experience in the industry, sharing how both organizations and entrepreneurs can find success in the GPO sphere.
This article covers the highlights of the interview.
What GPOs Want
Dale’s previous, long-standing role as Chief Contracting Officer at Amerinet (now Intalere) had him interacting with small business and entrepreneurs alike in order to contract and provide innovative medical technology solutions for their GPO members across the US.
Never knowing who might have the next “big thing”, his team was always willing to listen to any tech product presented to them. Any product with merit had to follow their three-fold vetting process, which Dale shared in hopes of helping entrepreneurs understand what criteria most GPOs use when signing new contracts.
Firstly, is your product safe and high-quality? If not, there’s no point in moving forward and discussions should end.
Second, what is the savings benefits for both providers and patients? Again, if savings solutions can’t be passed on to the GPO members, it’s not worth moving forward.
Lastly, what would the revenues look like for the GPO? While less important that the first two, revenue would obviously need to be taken into consideration, and, if they’ve done the first two steps well, revenue will always follow.
Other factors that GPOs take into consideration are customer service (how easy are you to deal with?), distribution capabilities (can you keep up with members’ demands?), and the financial stability of your company.
Where It Can All Go WrongA lot of companies negotiate their group purchasing agreement and think the work is finished, but the work really starts once you get the agreement. Once you get that agreement, it’s basically a hunting license to go call on those group members and show them what you’ve got.
Don’t stop once the contract is signed—it’s the open door you need to launch your success.
Dale also warned of the downfalls of arrogance—whether you are a market leader or just starting out, you don’t have all the answers, and you are only harming your business by being uncooperative. GPO’s have a choice and can easily choose to move on to a similar product from a company who is easier to work with.
9 Tips To Seal The Deal
1. Know your market. If it’s a small market, you might not get the ROI you need to make it worth your time and money. Also, make sure you can actually contribute something innovative to the market, rather than rehashing products that are already making the rounds.
2. Double the amount of capital you think you need. In nearly every case Dale saw of a startup falling over, they didn’t plan for enough capital. Know that it will, most likely, take twice as long to break even.
3. Have a passion for what you’re doing. Most people are savvy enough to see when someone is just trying to collect a paycheck so you have to be the biggest advocate of your product--love it, believe in it, and know how it can help.
4. Hire the right talent to make sure you are represented well. Like you, your representatives should know the product and the industry. Find people who can provide innovative solutions to the challenges you and your members face, who know your product inside and out, and can demonstrate why you have the edge over your competitors.
5. Be reliable and show up. Your customers need to know they can depend on you and that you’re there for them anytime they have a challenge.
6. Work hard! And know you’re probably going to lose a lot of sleep, especially if you are an entrepreneur and investing your own resources into your product. It won’t always be that way and the payoff is worth it.
7. Do your due diligence. Research what is already out there to see what is a potential help or hindrance to your success. You need to understand the needs of the members and whether or not your product can address those.
. Be honest. Tell the truth, whether it’s good news or bad news. Your customers will appreciate that they can depend on your honesty.
9. Be humble. Be grateful for those who give you their business because they have a choice, after all. Approach it as if you were stewarding their needs, rather than treating them with the attitude like you are doing them a favor.
If you have an innovative new medical tech product and would like to reach out to Dale for advice or direction, you can contact him via his LinkedIn profile, or drop him an email firstname.lastname@example.org.
This post is based on a podcast interview with Dale Wright from Actalur Group LLC. To hear this episode, and many more like it, you can subscribe to Med Tech Gurus.
If you don’t use iTunes, you can listen to every episode here.