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Where Do Medical Supply Stores Get Their Inventory?

In the United States, manufacturers and wholesale distributors are the primary sources of inventory for medical supply stores.

Manufacturers are known to manage the actual distribution of medical supplies from manufacturing facilities to medical supply wholesalers, and in some cases, directly to retail supply stores, mail-order and specialty pharmacies, hospital chains, and some health plans.

Manufacturers may also distribute products directly to government purchasers, such as the Veterans Administration, AIDS Medical supply Assistance Programs (ADAPs), and Vaccines for Children (VFC), which more or less receive the largest price discounts.

In some rare cases, a manufacturer may distribute medical supplies directly to a self-insured employer with an on-site supply store, but the typical employer-sponsored plan does not follow this path. Wholesale distributors are the manufacturers’ largest purchasers and very few medical supplies are distributed directly to consumers.

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Although traditional distribution services remain the cornerstone of the business, the industry has grown a more comprehensive list of services in response to the evolving marketplace.

Currently, wholesale distributors offer a number of specialized services, including specialty medical supply distribution, repackaging, electronic order services, reimbursement support, and medical supply buy-back programs.

Reports have it that the wholesale distribution industry has gone through significant change and consolidation in the last 30 years, due in part to the increasing pressures to lower costs.

Also, unlike most other sectors of the healthcare delivery system in the U.S., the medical supply chain is highly automated and virtually all claims transactions are handled electronically, rather than on paper.

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The medical supply system is complex and involves multiple organizations that play differing but sometimes overlapping roles in medical related distribution and contracting.

While wholesalers typically sell a variety of competing goods, Distributors may act as de facto sales representatives for manufacturers in addition to executing orders and managing returns.

Factors to Consider When Choosing Manufacturers and Wholesale Distributors for your Medical Supply Store

The goal of being in a retail business is to purchase at wholesale and to sell at retail. You will need to establish accounts with all of your local medical equipment distributors that sell products within the niche you have selected.

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Note that to begin an account, you will need to prove that you are a business entity. Most distributors also have a minimum dollar amount on each order that must be met, so if you are working with a tight budget, ask about the minimum order right away. Nonetheless, here are qualities and Factors to consider before making your choice.

  1. A Reputable Name in the Market

Have it in mind that brand recognition signifies reputation. This is one of the most pertinent aspects to check when dealing with health products and services. Choosing a trustworthy source for health and medical supplies will put you on the right track.

  1. Check Original Equipment Manufacturer (OEM) 

If you are not so sure about a distributor or manufacturer’s legitimacy, it is imperative to check their details with the Better Business Bureau. In addition, you should also look for the OEM warranty before buying any medical equipment and health supplies from the store.

  1. Order Accuracy

Good wholesalers will always get orders right every time and will have the infrastructure in place to ensure it happens. Whether the company you pick works locally, regionally, or internationally, ensure they have the tools in place, including the technology, distribution centers/facilities, inventory tracking systems, and route planning tools to get you exactly what you need when you need it.

  1. Proper State and Federal Licenses/Certifications

Note that manufacturers or Wholesale distributors based in the U.S. are required to comply with federal and state laws and regulations, including those established by the Food and Drug Administration (FDA) and the National Association of Boards of Pharmacy (NABP).

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The FDA, for instance, mandates wholesale distributors and manufacturers to follow certain procedures for storage, security, and distribution of medical materials, including maintaining adequate storage facilities with proper lighting, ventilation, temperature, humidity, and space. They are also required to follow strict security protocols and preserve distribution records carefully.

  1. Provides Excellent Service

Always remember that good service goes beyond friendly phone reps. It means the company provides rapid response times to questions, always follows up, goes the extra mile to make you happy, always accepts responsibility for slip-ups, and corrects mistakes immediately.

  1. Ability to Source a Broad Range of Items from Different Manufacturers

This is especially for wholesale distributors who are not bound by relationship agreements with manufacturers like some distributors are. They can provide a broad range of prescription drugs, including competing brands. If you are a full-service medical supply store, it is necessary to offer a broad range of products to clients/patients—seek out a wholesale distributor that can fulfill all or most of your needs.

  1. Transparency

Always remember that the livelihood of your business is potentially at stake if you sell medical supplies that are adulterated or counterfeit. Physicians and medical supply stores have been charged criminally for distributing such drugs. Have it in mind that any wholesaler you use should be forthcoming about where they get their supplies and should be able to supply supporting documentation.

  1. Mode of Payment and Returns Policy

Also, note that a reliable returns policy is one of the best ways to develop trust in a company. With this, you have the option of returning the supplies in case you don’t find them right.

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Finding the right manufacturer or wholesale distributor is a crucial and key tip for aspiring medical supply store owners. If you want to sell medical supplies, you will need someone to make them or even supply them to you. Take the time to find a respectable manufacturer or distributor that can provide you with quality supplies.

Note that the best partners will have already worked with medical practices and others in the industry. Having a comfortable relationship with them will make your job much easier. Be sure to locate the right supplier for your niche so that you can take your medical supply company to the next level.