Ask any expert, and they’ll tell you that the fastest way to undermine any supplier negotiation is by sharing too much information with the other party. Of course, the same rules apply when negotiating purchases of medical equipment. Whether you’re trying to fill an awkward silence or just trying to be a helpful partner, letting valuable information slip is an “unforced error” that can give the supplier significant leverage and cost you big bucks in the end. The goal is to make a supplier show you THEIR hand, not the other way around!
But don’t forget: you’re not the only one at risk of oversharing with a rep. Physicians, department staff, and anyone else in your hospital can also be a source of information for suppliers. Your colleagues can be extremely eager to get their new equipment, especially when the purchase process takes months or years to complete. In that eagerness, however, they are sometimes prone to volunteering too much when a rep comes calling (“the budget is already approved”, “we don’t have time for another round”, “we’re only considering your equipment”, etc.). Even when information is shared without ill intent, revealing it too early can derail momentum and cost valuable savings. But there’s an easy way to avoid this.
Share only necessary information with suppliers, and ask your colleagues to do the same. Make sure everyone knows that they’re more likely to get the outcome they want (price, configuration, terms, etc.) if they let you be the sole point of supplier communication until the negotiation is complete. Your colleagues may not even understand how valuable their information can be, thinking that oversharing is them just being “truthful” if a supplier asks them a question. But when a supplier asks your colleague if the budget for a purchase has been approved, tell them that they can support you and the hospital best by simply responding “I’m not sure; you might want to check with John about that.” If everyone in your organization can get on the same page and present a united front, you’ll have significantly more leverage in your supplier negotiation to help you get the savings you deserve.
Recently, a community hospital was finalizing the purchase of three new MRIs. Out of eagerness, the Radiology Director was about to tell the winning supplier they had been chosen and that the budget was approved at the quoted price. Luckily, the supply chain manager caught wind of the plan and asked him to wait to share the good news with the supplier, because final pricing hadn’t yet been reached. Within a week, the supplier agreed to lower the price by 9% and added six months of additional warranty at no cost – delivering a combined savings of nearly $500,000. Because the Director was willing to wait, his good news got a whole lot better!