4 ways to Improve Pharmacy Profit via Better Inventory Management

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A key component to improving pharmacy profitability is deciding how many drugs to keep in stock. The drugs you have in stock is often your biggest asset. Once this asset is established, it becomes an important input to the financial health of your pharmacy business. Keeping too much may mean less cash and less profit. Whereas keeping too little may mean lost sales as patients go to another pharmacy to buy their drugs. These tips can help you optimize inventory to help you become more profitable:

 

Place larger orders

Some pharmacies place too small an order for drugs. This can emanate from a whim such as going out of stock for one drug suddenly. This small and frequent ordering takes a lot of time and effort and costs you money in the process. If you restrict yourself to larger orders with proper planning, you can save time and money. You may even avail of discounts from your wholesaler and reduce the chance of stockouts on popular drugs.

 

Reduce overall inventory

Get rid of the excess stock you hold just in case. That Tenormin or Enaretic that’s been on the shelf for so long is not doing any good. Often times, you stocked it in the first place at the behest of a pushy sales rep who has a quota to fill. Always remove outdated products and items on the shelves that rarely move. You should aim to keep drugs on your shelf for around 30 days, the international standard.  This will give you more room to increase stock on your faster moving product. The result will be decreased overall inventory, increased cash flow and decreased costs of goods sold because you’ll be selling the same amount with less inventory.

 

Invest in inventory software

Computers are very powerful and handle certain tasks far better than humans. Inventory management is one such task. Investing in computers and inventory software might seem expensive initially but the savings it will provide you will make up for the cost. Finding the right software can be tricky as there are many. Our advice is to go with one that is international, tried and trusted like Quickbooks. Quickbooks helps you keep track of everything you buy and sell and generates smart reports to help you dig into your inventory and business. Implementing it is straight forward and not so expensive.

 

Keep track of your patients

Knowing what to stock can often be guess work. A good inventory management system like QuickBooks will help remove a lot of the guessing. Further to this, having a good system to track what your chronic patients are on, what and when they will return to refill can give you a better idea of how best to maintain your inventory. You can tell for example that you will need 10 packs of metformin based on your tracking of patient medications and prepare your inventory accordingly.

 

Implementing these tips can help improve your inventory management and profitability. Contact us for help with software to easily track your patients and look at your refills to create a smarter inventory management process. We can also help you with adopting QuickBooks. Just call or whatsapp us on 08179045442.

 

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