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Managing Inventory and Staying Stocked: Key Tips for Pharmacy Owners

Managing Inventory and Staying Stocked: Key Tips for Pharmacy Owners
Photo by Wengang Zhai on Unsplash

Running a pharmacy requires diligent inventory management and adequate stocking to meet customer needs. With the right systems and procedures in place, pharmacy owners can ensure their business has the products patients require when they need them. Follow these six tips to properly manage your pharmacy’s inventory and avoid stockouts that can negatively impact your operations and bottom line.

Establish Par Levels

Determine ideal inventory levels, par levels, for each product you carry based on historical dispensing data and sales velocity. Factors like seasonality, upcoming shortages, and changes in formularies or clinical guidelines may require adjustments to par levels. Work with your wholesaler to establish minimum and maximum levels that trigger automatic reorders when inventory drops below the minimum.

Regularly review and update par levels as dispensing patterns change over time. New generic releases, drug recalls, discontinuations of products, and shifts in prescribing behaviors will impact inventory needs. Analyze vendor out-of-stock reports and metrics like months of stock on hand. Collaborate with staff to identify fast movers to consider increasing par levels. This ongoing process ensures par levels match actual demand.

Implement Inventory Controls

Accurate inventory tracking ensures you order the right products at the right times. Conduct regular cycle counts to verify on-hand quantities. Invest in pharmacy management software that monitors perpetual inventory and automatically updates counts when dispensing items. Require staff to record any drops, breaks, or waste. Conduct a full annual physical inventory count. These controls allow you to identify variances and prevent inventory loss.

Proper documentation is key to effective inventory controls. Create log books for recording damaged, expired or returned goods. Track lot numbers and expiration dates. Document all transfers, withdrawals, and adjustments. Rigorous documentation provides an audit trail that supports loss prevention and regulatory compliance. Make sure staff understand the importance of recording every inventory transaction accurately.

Streamline Ordering Procedures

Create streamlined ordering protocols designating specific employees responsible for monitoring stock levels and placing orders. Establish fixed days and times for deliveries to maintain consistent inventory availability. Place emergency weekend orders in advance and coordinate drop-shipments for specialty drugs with long lead times. Organized ordering processes help optimize inventory turnover rates.

Leverage technology to gain efficiencies in ordering workflows. Configure pharmacy management software to generate suggested reorders based on par levels. Implement electronic purchasing to automate transmitting orders. Use barcode scanning to quickly input items received. Set rules for approving orders to enforce purchasing protocols. Streamlined computerized procedures can significantly reduce time spent on ordering while improving accuracy.

For pharmacies that provide delivery services, it is critical to choose a reliable courier provider. Evaluate potential couriers based on their expertise in handling pharmaceuticals, medical supplies, and lab specimens. Ensure they have protocols and trained personnel to maintain product integrity. Choose a service with extensive logistics capabilities to meet unpredictable volume surges. Tracking and chain-of-custody documentation should be robust. Establishing dependable delivery logistics is vital for safe, timely item transport and superior patient service. Pharmacy owners in the Los Angeles area may want to search for “medical couriers California” to find top-rated local services to meet their business needs.

Manage Inventory Costs

Carrying too much stock strains cash flow, while inadequate inventory loses sales. Utilize stock rotation, moving older products to the front. Watch for soon-to-expire items and short-dated products to avoid write-offs. Eliminate stagnant SKUs not dispensing regularly. Renegotiate terms with wholesalers. These steps minimize capital tied up in inventory while still meeting demand.

Analyze inventory turns, days on hand, and other metrics to identify excess stock that can be reduced. Avoid tying up capital in slow-moving items that experience declining use. Implement scanning systems that alert staff when approaching short-dated items. Establish processes for agreeing to take on manufacturer short-dated stock at a discount. Managing inventory costs requires both cutting excess products and procuring products opportunistically to control expenditures.

Organize Storage Areas

Implement an organized storage system allowing fast retrieval of items. Store the fastest-moving items near the dispensing counters. Arrange shelves from top to bottom in order of expiration dates, with the oldest stock in front. Designate specific areas for incoming inventory and items needing refrigeration. Keep combustibles in fireproof cabinets. An orderly dispensary supports accuracy and efficiency.

Conduct regular reviews of storage arrangements, usage patterns, and space constraints. As inventory needs evolve, adjustments may be required. Add signage and labels for easy identification of products. Consider expanding refrigerated space if refrigerated items are increasing. Arrange items by manufacturer or drug class to simplify reordering. Adequate lighting, cleanliness, and accessibility also support an organized storage environment.

Audit Inventory Regularly

Performing routine inventory audits ensures the perpetual counts match actual quantities on hand. Double-count narcotics and controlled substances monthly to prevent diversion. Conduct random sample counts of top products quarterly. Compare physical counts to perpetual values and recount discrepancies to find the source. Accurate audits allow timely corrections, preventing bigger issues.

Designate employees to conduct independent inventory audits following established protocols. Investigate any identified discrepancies and implement procedures to prevent recurrence. Expand audit scope if significant variances are found. Provide additional training to employees with high error rates. Leverage audits to identify process improvements. Effective auditing requires consistent procedures, detailed documentation, and follow-up on problematic issues identified.

Staying adequately stocked is crucial for providing excellent patient care and customer service. Following these inventory management procedures helps pharmacy owners optimize stock levels, reduce costs, minimize waste, and enhance regulatory compliance. With robust controls and processes, pharmacies can focus on efficiently fulfilling prescriptions while avoiding problems like shortages, loss, or expirations detrimental to the business. Monitoring par levels, streamlining ordering, organizing storage, and regularly auditing inventory enables owners to ensure their pharmacy remains properly stocked.

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