What Is a GPO?

As the dental industry undergoes many changes to meet customer needs, new solutions are emerging to make ordering and managing dental supplies easier. One of the most common solutions is group purchasing organizations (GPOs), which help practices free up resources to invest more time and energy in growing their practice and patient care.

What Does GPO Stand For?

A GPO or group purchasing organization is when a group of practices or other organizations join together to leverage their purchasing power. By coming together as one, a GPO allows members to access a lower price from suppliers. The concept of a GPO is similar to receiving discounts for bulk purchasing or membership at a wholesale club. You’ll find three main types of GPOs:

1. Horizontal: In a horizontal GPO, members may have practices in different industries, but all require similar products or services. By joining a horizontal GPO, practices can get what they need while paying less for these items.
2. Vertical: With a vertical GPO, the main focus is one industry and the services or products within that industry. A vertical GPO offers better pricing and deep discounts on industry-specific goods and services.
3. Master buyer: With a master buyer GPO, one organization enters into contracts with providers and lets others buy from them at a set price. A master buyer GPO is a great benefit for smaller companies, as it enables them to access the same prices as bigger organizations.

What Are Dental GPOs

A GPO for dentistry helps practices, clinics and other dental-related businesses save money on products and services by negotiating pricing and contracts on behalf of dental practices. The GPO may also provide practice management services, compliance education and training. Some dental GPOs have affiliations with professional organizations, which allow them to offer a broader range of benefits, such as legal services and access to clinical research.

Benefits of GPOs for Dentists

Becoming a member of a GPO can offer a wide range of benefits for dentists beyond saving money. Some of the additional benefits include:

• Reduced cost: GPOs can be data-centric, which means they collect large amounts of data about member buying practices. The organization can then use that data to negotiate better contracts and terms for all members.
• Less time negotiating contracts: A GPO will work directly with suppliers and vendors to manage and negotiate contracts. This means you’ll have more time and resources to focus on your practice and obtaining new patients.
• More predictability: When a practice joins a GPO, they typically sign a contract that sets terms like payment at one rate throughout the length of the contract. Having an established contract enables practices to create more accurate budgets.
• Better contracts: Joining a GPO means practices can have better vendor contracts. This means a practice can easily boost its cash flow based on improved contract terms.
• Discounts on products and services: Becoming a member of a GPO is much like buying in bulk in that buying a bigger quantity means you will pay less. For example, with a GPO, you may all contribute to buying 1,000 boxes of gloves for a discounted rate and then split the boxes among 10 practices.

Differences Between GPO and DSO

A DSO or Dental Service Organization is a company that acquires and takes over the “office” side of your practice, such as operations and marketing. A DSO owns your practice and equipment and is responsible for employing all non-clinical team members.

When comparing a GPO vs. DSO, you’ll find that a GPO is very different in that you can remain in control of all aspects of your practice while having access to greater buying power. Unlike a DSO, where one company is in control, GPOs build a base of members who use their collective purchasing to obtain discounts. As a GPO gains more members, the suppliers make more sales, allowing the GPO to access even lower prices.

How to Tell Which GPO Is Best for Your Practice

Before becoming a member of a GPO, it’s beneficial to take the time to explore which GPO offers the most benefits for your organization. Some factors to consider before making a decision include:

GPO Structure

Consider whether your chosen GPO follows a vertical or horizontal structure. If you want assistance with purchasing tools specifically for your dental practice, you will want to join a vertical GPO. If you want to access greater buying power for office supplies and other general office items, you may want to join a horizontal GPO.

Vendors

The vendors a GPO works with will play a significant role in your decision. For example, if you operate a larger practice, you may want to join a GPO that does business with 50 vendors instead of a GPO that only works with 25 members. You will also want to look at the quality of vendors, and if you already work with some of the same vendors as the GPO, it may be worth joining their membership.

Available Services

GPOs offer more than cost savings, making it a good idea to take the time to consider your practice’s needs. For example, you may need assistance with a continuing education program or already have a practice management system in place. It’s easy to focus only on the many services a GPO offers, but taking time to understand what you really need can help you get the most benefit from joining a GPO.

Transparency

The ideal GPO will be open and transparent about how it conducts business. As you learn more, you will want to check specific details, such as if all members pay the same prices and if certain members get better discounts than others. You will also want to know your options if you wish to leave the GPO before your contract ends.

Use Your GPO to Buy Top-Quality Products From ProDentUSA

Whether you’re a member of a GPO or a sole practitioner looking for high-quality dental equipment, you can trust ProDentUSA to be a reliable partner. We make all our products with high-grade steel and are happy to work with you and your practice to develop the tools you and your patients need.

Let us help you continue spreading smiles with some of the best dental products on the market. Explore our range of tools, or contact us to learn more!