What are the most effective ways to measure procurement risk in Medical Sales?

1 Identify key risk indicators

Measuring procurement risk in medical sales begins with identifying the key risk indicators (KRIs) that are pertinent to your sales objectives, industry, and customer segments. KRIs are metrics that gauge the level of exposure to a particular type of risk, such as quality, delivery, compliance, or price. For instance, some common KRIs for medical sales include supplier defect rate (percentage of products or services not meeting the customer or regulatory body standards), supplier lead time (time taken to deliver after receiving an order), supplier financial stability (ability to meet financial obligations and maintain operations), and supplier contract compliance (adherence to contract terms such as warranties, penalties, and discounts).

2 Monitor and track risk performance

Once you have identified the KRIs that matter to your sales goals, you need to monitor and track their performance over time, using data sources such as supplier reports, customer feedback, market research, or industry benchmarks. You can use tools such as dashboards, scorecards, or graphs to visualize and compare the risk performance of different suppliers, products, or markets. For example, you can use a dashboard to show the trend and variance of the supplier defect rate, lead time, financial stability, and contract compliance for each of your key accounts.

3 Analyze and prioritize risk impact

The next step to measure procurement risk in medical sales is to analyze and prioritize the impact of each risk on your sales outcomes, such as revenue, margin, customer retention, or market share. You can use methods such as risk matrices, risk maps, or risk ratings to assess and rank the likelihood and severity of each risk, and identify the ones that require immediate attention or mitigation. For example, you can use a risk matrix to plot the supplier defect rate and lead time against the revenue and margin of each product category, and highlight the ones that pose the highest risk to your sales performance.

4 Implement and evaluate risk mitigation strategies

The final step to measure procurement risk in medical sales is to implement and evaluate the effectiveness of your risk mitigation strategies, such as supplier development, contract negotiation, contingency planning, or alternative sourcing. You can use tools such as action plans, risk registers, or risk audits to document and monitor the progress and results of your risk mitigation actions, and measure their impact on your sales KPIs, such as customer satisfaction, conversion rate, or repeat purchase. For example, you can use a risk register to record the actions taken to reduce the supplier defect rate or lead time, and track their impact on the customer satisfaction and conversion rate of each product category.

By using these four steps to measure procurement risk in medical sales, you can gain a better understanding of the factors that affect your sales process, performance, and profitability, and take proactive actions to minimize or eliminate the negative effects of risk. This will help you to improve your sales strategy and results, and build stronger and more loyal relationships with your customers and suppliers.

5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?