A pharmacy can only be as successful as its inventory. No matter the size, location, or nature of your business, no pharmacy will reach its full...
5 Essentials for Pharmacy Inventory Management
How much attention are you paying to your inventory? Chances are, probably not enough. Here are 5 essentials for managing your pharmacy's inventory.
Inventory Management. These two words often seem to represent a perfect example of “easier said than done”. Not because any one task is particularly difficult, especially with the right pharmacy point-of-sale (POS) tools. But because there are many components of an effective inventory management program and there’s no one-size-fits-all solution.
So, if there’s no absolute rule book for managing pharmacy front end inventory, how can anyone actually take it on and succeed? The answer lies in understanding the essential components of managing inventory.
Here are 5 big pieces of the puzzle that you can take on one at a time to build an effective, efficient and, yes, easy to run inventory management strategy.
Use Your Sales and Profit Analysis Report
No matter what this report is called in your pharmacy POS system, the data it contains forms the foundation for your inventory management strategy. It is arguably the most important report in your pharmacy POS system.
Sales and profit reporting data helps you understand what’s going on in your pharmacy front end and helps you make informed decisions and the products you carry. This is true whether you have a small front end filled with basic over-the-counter (OTC), a large mix of retail products, gifts and convenience items, or something in between.
Understand Inventory Management
Before you can truly manage your pharmacy front end, you need to understand some key concepts and make a few decisions on the best inventory management methods for your pharmacy business. This article takes you through many of the definitions you’ll need to know.
Develop an Inventory Counting Strategy
Inventory counting is nobody’s favorite thing. But, it is a necessity for a properly managed front end. Keeping accurate inventory counts in your pharmacy enables you to understand your inventory value, order more effectively and identify potential problems like shrinkage.
The most important thing about inventory counting is getting all of your ducks in a row before you start. Take steps to ensure the integrity of your data and the product catalogs in your system. Get rid of item stickers in favor of shelf labels and make a few other key decisions before you start counting. Setting up a perpetual inventory counting process where you count small sections of the front end regularly instead of one massive annual count will actually make the inventory counting process easier to maintain. This article has all of the inventory counting details you need to get started.
Separate pricing from receiving.
Many pharmacies run time consuming receiving processes just because that’s the way it’s always been done. Receive your products, sticker the products with the included labels, scan the product in the point-of-sale system to make sure the price is accurate.
There’s a better way to receive products. And the process shouldn’t be paired with pricing. Automating price updates from your wholesaler, putting out shelf labels instead of individually stickering products, and receiving the order as a batch is more accurate and so much faster.
The fineline code is an essential, but often overlooked piece of the product management puzzle. Either deemed as unnecessary due to small front end size, or too much work to maintain in a large retail pharmacy. For one reason or another, finelines are neglected which makes many inventory management activities more difficult than they need to be. Luckily finelines can be simplified and offer all kinds of benefits. From improved accounting visibility to more accurate reporting that makes it easier to make decisions about product movement. See how to streamline finelines in your pharmacy by watching this tutorial.
Our last, and perhaps most important piece of advice is to take each of these components on one at a time. Build the foundation piece by piece to create a successful inventory management program that you can stick with long term.