The Growing Gray Market in Dental

This doesn’t get talked about much. But the dental industry is seeing a rise in what’s called the gray market — practices buying dental supplies or equipment that’s been resold by vendors outside of the US.

Here’s an example. Name-brand ACME Medical Supply will sell a case of latex exam gloves to American dentists for $130.

But Acme will sell an identical case of gloves to buyers in China for $25 — because that’s the best price they can get in that particular market.

What happens next? The buyers in China will turn around and offer to sell the gloves to dentists in America for $40.

Seems harmless enough. Both vendors involved still make a sale and dentists get their materials for cheaper.

But there’s also plenty of room for trouble to arise. Those gloves may have spent two years sitting in a warehouse in Guangzhou before being resold (gray market sellers are often looking to offload old inventory) instead of being delivered to practices fresh off the production line. 

While this may not be a big deal for some products, what about more sensitive goods — say, composite bonding material or intraoral x-ray machines?

This question is important because even major DSOs are getting in on the gray market game. And we expect that trend to continue because if anything, the ability to save big on supplies is even more appealing when you’re dealing with a supply budget in the millions.

But will those savings come at the cost of patient care? We don’t know, but we suspect that the dental industry may find out.

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