Inventory Control and Maintenance

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Inventory Control and Maintenance

• Office Management

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Introduction

• Maintenance of an active working inventory
  requires both planning and continuous monitoring.
• Failure to do so may result in shortage,
  inefficient use of time, increased costs, and
  added stress.
• Ideally quantities stocked should be as small as
  possible without running out between reasonable
  ordering periods.

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• Managing an inventory can be overwhelming.

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• Inventory turnover- the number of times per year
  that an item is bought and sold.
• Should be at least 4 to 6 times a year. May be
  greater in instances of food or frequently used
  inventory.
• Lead time- When a re-order should be placed.

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Strategic Inventory Analysis
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Computer Aided Inventory Control

• Computer systems are great at monitoring
  inventory control.
• Physical inventory should still be done at least
  once a year (preferably twice a year).
• Higher the turnover, the lower the investment in
  an item.

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Inventory Maintenance

• Primary disadvantage to large inventory is money
  that is tied up in drugs and supplies.
• Large inventory makes switching to equivalent
  drugs difficult even if cheaper.
• Large inventory may lead to expiration or
  spoilage.
• Savings for investing in large amount of
  product should be approached with caution. Need
  to accurately predict how much product will be
  used before ordering massive quantities.

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• Frequency and amount of orders may be dependent
  on what is policy of distributor in which you are
  ordering from.
• May increase and order to decrease frequency of
  order and therefore reduce cost.
• Most veterinary hospitals employ a just in time
  ordering system.

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80/20 Rule

• 80 of inventory dollars are represented in only
  20 of inventory items.
• Heartworm and flea preventions.
• How to determine what is 80/20
• List total inventory in descending dollar value.
• Whatever is at top represents what you spent most
  on in last 12 months.
• Things at bottom of list may not need to be
  reordered as frequently. However always try to
  keep one of everything on hand in case of an
  emergency.

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Shrinkage

• Shrinkage- decreases in inventory that can not be
  accounted for.
• May be due to not being charged, not noted when
  used or theft.

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Things to Avoid

• Stocking multiple brands of same medications.
• Having multiple doctors use multiple medications,
• Having a large inventory of medications with
  similar qualities.
• Ex Rimadyl, Deramaxx, Metacam, Previcox

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Rules to Remember

• Have one person in charge of hospital inventory
  to prevent confusion.
• Have an inventory control system.
• Tells you when you need to reorder items.
• Tells you who you ordered from in the past and
  how much you paid.
• Tells you how much you ordered previously.
• Provides accurate data on current inventory.
• Have a want list and mark by urgency that
  product is needed.

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Who do you order from?

• Veterinary Suppliers
• Veterinary wholesale or distributors
• Butler, MWI, Webster
• Veterinary Practices
• Maintain relationship with close veterinary
  clinic for emergency needed items.
• Directly from Company
• Some companies will only sell directly to the
  veterinarian.
• Pfizer, Merial, Novartis, Ft. Dodge, Hills, Iams,
  Bayer, Idexx, Purina, etc
• Pharmacies
• Human pharmacies may have common drugs available
  or be able to compound certain medications.
• Other suppliers
• Human hospitals
• Chemical suppliers
• Mail order companies

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Receiving and Recording

• When product arrives in clinic, look for packing
  slip.
• Packing slip includes list of items in package
  and should be checked against contents to ensure
  everything is there and in good condition.
• Check expiration dates.
• Place items in appropriate areas.
• Record inventory in appropriate logs.

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Order Control Sheet

• Should have
• date ordered
• Source
• item
• strength
• number in stock
• ideal number to order for minimum cost (EOQ)
• last price
• new price
• number ordered
• date received
• if backordered

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Computerize or Not Computerize

• Without computer system may be using manual
  system that is harder to control and manage.