# Step 2: How to Request Quotes & Prep for Vendor Negotiation

09.02.20|8 Minutes

## Learn how to draft an RFQ and calculate potential savings so that you can get the best possible deal on dental supplies for your organization.

Achieving the best deals on your most essential supplies has always been critical to running any dental practice. Cutting supply costs has never been more vital to your organization. With distributors competing for market share, you need to secure the products your dental organization requires in the most cost-effective fashion.

In the [first part of this series](https://www.curemint.io/how-to-organize-your-supply-expenses-create-a-formulary/), we analyzed your spending on dental supplies. In this post, we’ll use your findings to get the best prices on your supplies. This is where you’ll determine your baseline for negotiation. You will supplement your findings with price-point comparisons from other vendors and suppliers.

[_Download the entire 9 Step Guide to Driving Down Dental Supply Expense here._](https://www.curemint.io/9-step-guide-to-reducing-dental-supply-costs/)

**STEP TWO: REQUEST FOR QUOTATION (RFQ)**

Knowledge is power. Your starter formulary is the foundation of reducing your yearly costs. With all of your spending information collected, you’ll strengthen your case moving into negotiations.

Your first move is to send out your [starter formulary](https://www.curemint.io/how-to-organize-your-supply-expenses-create-a-formulary/) with pricing requests, or a **_Request for Quotation_** (RFQ). This RFQ will make it clear to distributors that you want a fresh price comparison on all the products you’ve ordered over the past year.

Without an RFQ, distributors may substitute cheaper products instead of providing a like-for-like comparison. Whenever possible, you want the same high-quality products your staff is familiar with, just at a better price.

Negotiations begin during the RFQ stage. When drafting your RFQ, supplement your request with a few simple questions, such as:

- Where are your distribution centers and/or corporate support sites located?
- What are your standard shipping transit times or rates?
- Which dental service organizations (DSOs) have you recently added to your clientele?
- Have you lost any DSO accounts in the last 12 months?
- Can you provide references from other DSOs?
- Do you offer training?

Additionally, seek other possible variables to sweeten your deal. If negotiations go well, you may finagle extras such as signing bonuses, early-pay discounts, continuing education allowances, corporate meeting sponsorships, marketing material, or volume discounts.

For larger dental organizations, consider a **_Cost-Plus Transparent Pricing Model_**. A cost-plus contract standardizes the markup percentage across all inventory, based on the manufacturer’s production cost. The dental industry has yet to capitalize on this model, so if you buy supplies at high volume, inquire about establishing a cost-plus contract.

Send your RFQs to major distributors in the dental industry and smaller local suppliers you might want to work with in the future. The more informed you are about your pricing options, the better deal you’ll negotiate.

The RFQ should consolidate your suppliers. You may find that, through analysis, you are purchasing the same products from different distributors. Your RFQ will clearly state the potential total spend on that product category if you were to direct everything to one distributor.

After receiving all RFQs, enter the data from each distributor alongside your starter formulary:

Now that you’ve created a single source of data, you can compare your previous 12 months’ total spend to the new price points each distributor quoted. While prices for certain products may vary, you may find significant savings with different distributors. For example, Distributor 2 can provide total savings of over $6,000 on the _exact same products_ you are currently buying from Distributor 1. With this information, you can negotiate the best deal possible.

> _TIP: Unit of Measures(UOM) – Not paying attention to UOM can result in overestimated savings, or even increased spending._
> _For example, distributors bidding that don’t currently work with the DSO might not provide pricing for other distributor’s house brand products, leading to discrepancies in UOM._

RFQs represent a significant amount of work, but this process quickly identifies where savings can be made in your dental organization.

In the next steps, we’ll leverage the information from the RFQs to negotiate exceptional deals for the products your offices love.

_Keep a lookout for part three: How to Negotiate Like A Boss_

[_Can’t wait for the next blog? Download the full guide to get immediate access to Step 3_](https://www.curemint.io/9-step-guide-to-reducing-dental-supply-costs/)