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When a buyer pays late, the supplier has to finance the stock for longer. That cost will show up in the price of medicines. Health economist Noemi Schramm Ndao makes the case in public procurement, but the same lesson applies to hospitals, pharmacies and other healthcare businesses: Reliable payment gives buyers room to negotiate better prices.
“Most of all, it means reducing payment delays. Suppliers need transparency and predictability on how much they'll be paid and when. Any uncertainty and any delay gets priced in as a premium, and that erodes the value for money governments get,” says Schramm Ndao.
For a clinic or pharmacy buying on credit, the practical step is to ask suppliers for different payment terms. A lower price for earlier payment can make sense if the business has the cash to spare.
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