Loaner Pools Can Help Increase Efficiency

Start-up companies are under constant pressure to use capital efficiently. A long-standing problem in the orthopedics industry is a company’s initial capital outlay for building the instrument sets necessary to implant their product and create revenue. Start-ups always look at this as a cost of doing business;  they budget for a certain number of kits, and then send those kits out as consignment to surgeons and sales reps, hoping that the volume of implant sales cover the instrument capital costs.

In order to reduce the number of kits needed to launch a product, many companies utilize a loaner pool of instruments and implants. By using a loaner process, a start-up can more efficiently allocate their kits in one of two ways:

  • Making a sales rep or surgeon earn a set
  • Providing a mechanism for pulling a set from an underperforming location and redeploying it to higher revenue-generating area.


Take the Guesswork Out of the Loaner Process

While setting up a loaner program can increase efficiencies for a company, it is not always feasible for a start-up company. That’s because it can require significant set-up costs in the form of expanding warehouse space, purchasing and installing an autoclave or washer disinfector, validating the equipment, and hiring employees and managers.  Furthermore, because sales rep and surgeon demands change on a moment’s notice, and daily processing volumes can be wildly variable, loaners can be challenging from a staffing perspective—often there are too many employees when volume is low or too few employees when volume is heavy.

Luckily, start-up companies can enjoy the benefits of a loaner program without the start-up costs and staffing challenges of creating the program in-house by using an outsourced loaner program. Outsourced loaner providers offer access to state of the art processes and equipment, experienced professionals, and savings on validation, HR, and employee management costs. Most importantly, being able to tap into an outsourcing company’s flexible work force gives start-ups the ability to meet demand spikes, but also save on staffing costs when volume is low.

When looking at the set up cost alone, the average start-up could pay for three years of kit processing through an outsource company and still save money, while simultaneously accessing a service that sets them apart from their competition.

Benefit In House Outsource
Inventory Reduction X X
Capital Cost Reduction X X
Enhanced Service to Customers X X
Quality Control X X
Labor Cost X
Flexibility X
Turn Around Time X
Cut Off Time X
Scalability X
Industry Benchmarking X
Up to Date Infrastructure X
HR/Management Time Reduction X

Choose the Right Loaner Solutions Partner

When evaluating an outsource loaner solutions partner, there are several things to consider beyond a standard strong quality system and an established process:

  • Your partner should have at least two autoclaves. This ensures that if one is down for maintenance or is damaged; your program won’t be grounded.
  • Your partner should also be in close geographic proximity to a major air hub (preferably UPS or FedEx) in order to allow for later cut off times and more direct flights for your kits. This will help guarantee that even late night orders can arrive in time for a morning surgery.
  • Your partner should be located in an area with relatively good weather as the last thing you want is to miss a surgery due to a snow storm, or thunder storm.
  • Finally, your partner needs to understand your products and your industry, so that they can protect you from accelerated product wear, obvious product misuse and unforeseen product issues.