PP Stock Control PPT Notes

PP Stock Control PPT Notes

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  Platinum Practice 1 Alan RobinsonB.V.Sc. MRCVS DMS Stock Control Where does it all go? Stock Control Stock Control (or Inventory Management) • is a separate part of the business • needs to generate a profit. To do that it needs to 1. be priced profitably 2. stock less and 3. sell (turn over) more. 5 steps in gaining and retaining control of stock management 1. Take control. 2. Know your figures: ‘If you can’t measure it you can’t manage it!’ 3. Simplify, simplify, simplify. 4. Ordering cycles. 5. Control Dispensing.
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  Platinum Practice 2 Take control. Makesure someone is in charge of Stock Control – it is a full time job and responsibility that requires a dedicated and trained individual to look after. They are responsible for a budget of £250,000 to £350,000 in the average veterinary practice. £120 = £100 Income = PROFIT plus Drug Costs plus Wages plus Fixed Costs Fixed Costs Wages Drug Costs PROFIT £40 £15 £30 £15 Business Costs Vet, Nurse & Reception Wages Buildings, Admin, Cars, Marketing, CPD etc MARKUP Cost Price per product Number of Products soldx INCOME Consumable Costs Retail, Drugs, Food, Consumables, oxygen, cremation, laboratory Cost PRICE per product Number of Products boughtx Consumable Income Professional Fee Income COSTS No. of Vet hours Rate per hourx 30% 40%
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  Platinum Practice 3 Mark-ups? By Category •GSL – 30 – 40% • PML – 50 - 70% • POM-V – 100 – 150% Average Mark-up = 83% Average Profit = 55% Drug Profitability • Consumable Costs = 30% of Income • Consumables Income = 40% of Income • Mark-up avg. = 33% • Profit avg. = 25% • Therefore Profit = 10% of Income John Sheridan • In my experience veterinary practices generate net profits ~15% on medicine sales (after allocating the appropriate share of staff and overhead costs) • but much less than 5% on the sale of professional services. Very many practices make a loss on the sale of their professional expertise and time
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  Platinum Practice 4 Business Costs Vet,Nurse & Reception Wages Buildings, Admin, Cars, Marketing, CPD etc MARKUP Cost Price per product Number of Products soldx INCOME Drug Costs Retail, Drugs, Food, Consumables, oxygen, cremation, laboratory Cost PRICE per product Number of Products boughtx Drug & Retail Income Professional Fee Income COSTS No. of Vet hours Rate per hourx 1 2 3 4 FREE!! Know your figures ‘If you can’t measure it you can’t manage it!’ At any point of time you need to be able to track  What you have got and what you have sold by product and category  Where it is by location, branch, car, etc.  How much it cost (net/net price)  When you need to sell it by (reduce wastage and overstocking)  When you need to order more (measuring stock turns) Mark-ups? By Category • GSL – 30% • Food – 40% • PML – 70% • POM-V – 100%
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  Platinum Practice 5 The Top20% 18 chronic 6 acute Product Name T ot al Total % of Total Cum Pareto 1 week 2 week Month Antepsin Suspension 250ml 17706 7.7% 17706 7.7% 341 681 1476 Prednisolone Tabs 5mg 15479 6.7% 33185 14.4% 298 595 1290 Felimazole Tabs 5mg 15210 6.6% 48395 21.0% 293 585 1268 ZANTAC SYRUP 150MG/10ML 11273 4.9% 59668 25.9% 217 434 939 Noroclav 250mg Tablets 11226 4.9% 70894 30.7% 216 432 936 Lactulose Sol 10025 4.3% 80919 35.1% 193 386 835 EPIPHEN TABS 60MG (PHENOBARB) 9460 4.1% 90379 39.2% 182 364 788 Noroclav 50mg Tablets 8044 3.5% 98423 42.7% 155 309 670 Viacutin Plus Caps 300x500mg 7860 3.4% 106283 46.1% 151 302 655 EPIPHEN TABS 30MG (PHENOBARB) 6084 2.6% 112367 48.7% 117 234 507 Piriton Tabs 4mg 5136 2.2% 117503 50.9% 99 198 428 Rilexine Tabs 300mg 5136 2.2% 122639 53.2% 99 198 428 SOLOXINE TABS 0.8MG 4714 2.0% 127353 55.2% 91 181 393 Rilexine 600mg 4708 2.0% 132061 57.2% 91 181 392 Fortekor Tabs 2.5mg 4082 1.8% 136143 59.0% 79 157 340 VETMEDIN TABS 5MG 3770 1.6% 139913 60.6% 73 145 314 Florinef 0.1mg Tabs 3248 1.4% 143161 62.1% 62 125 271 Frusemide Tabs 20mg 3030 1.3% 146191 63.4% 58 117 253 Antepsin Susp 2966 1.3% 149157 64.6% 57 114 247 * Propofol Vials (novartis)-destock 2803 1.2% 151960 65.9% 54 108 234 Incurin Tabs 2648 1.1% 154608 67.0% 51 102 221 Chlorhexidine 2567 1.1% 157174 68.1% 49 99 214 Codeine Linctus 3mg/ml 2490 1.1% 159664 69.2% 48 96 208 Neo Mercazole Tabs 5mg 2396 1.0% 162060 70.2% 46 92 200 LANOXIN PG TABS 0.0625MG 2366 1.0% 164426 71.3% 46 91 197 Rilexine Tabs 600mg 2330 1.0% 166756 72.3% 45 90 194 Vetmedin Caps 1.25mg 1952 0.8% 168708 73.1% 38 75 163 TAGAMET TABS 200MG 1820 0.8% 170528 73.9% 35 70 152 Viacutan Caps 500mg 300 1720 0.7% 172248 74.7% 33 66 143 FRUSEMIDE TABS 40mg 1566 0.7% 173814 75.3% 30 60 131 5 Acute = 16% 25 Chronic = 83% Drugs (by usage – NOT Category) 1. Acute short-term & service driven – high mark-up 2. Chronic long-term product driven – low mark-up + service Simplify, simplify, simplify. • The most efficient stock control systems are the simplest. • Computer based stock control helps enormously but is complicated in terms of set up and maintenance and are not infallible. • Remember 80% of your stock control comes from 20% of your stock holding.
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  Platinum Practice 6 24 drugs= 80% usage Simplify, simplify, simplify.  Step 1: simplify the stock list - purge redundant/unused items  Step 2: de-stock low turnover items (specials)  Step 3: reduce replicated products e.g. ear preps, flea control, etc. This means getting the vets to discuss and decide protocols…! Need Protocols for…. • Thyroid • Diabetes • Gastro-intestinal • Coughing • Cardiac • Skin… • etc • Vaccination • Worming • Fleas • Ears • Eyes • Skin • Teeth Procedures AND Products
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  Platinum Practice 7
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  Platinum Practice 8 Ordering cycles StockTurns = product ‘turned over per year’ • Annual usage / 12 = monthly • Annual Usage / 50 = weekly • Annual Usage / 4 = quarterly (for deals)
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  Platinum Practice 9 Ordering cycles: 1.Daily/Weekly ordering process for critical items and special orders. 2. Monthly ordering process for the majority of stock items 3. Quarterly Review process to adjust for • seasonal products • treatment protocol changes and • the introduction of new products • ‘deals’ from the drug suppliers
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  Platinum Practice 10 Control Dispensing. 1.Uncontrolled dispensing of stock particularly in equine/large animal and OOH situations plays havoc with stock control and invoicing. 2. Clear protocols and systems to manage dispensing to vets and clients is an essential discipline to improve efficiency and profitability. Stock Tasks for Inventory Manager Mark ups – by Category: • 30% - OTC, chews, muzzles, leads etc • 40% - Lifestyle & Rx diets & dental • 50% - chronic medication and GSL’s • 66% - Flea and Wormer treatments • 150% - routine clinical drugs • 200% acute / emergency / special clinical drugs Stock Tasks for Inventory Manager • Dispensing fees – ensure all are present and correct • VAT – ensure all are present and correct • Pack sizes, names of products etc, ensure all are correct • Alerts – put on alerts for off-license medications, items not to keep in stock etc • Deleted products that you do not use anymore
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  Platinum Practice 11 Stock Tasksfor Inventory Manager • Drug protocols, unauthorised, off-licence documents - attached to relevant products to either attach or print off at the point of sale. • Vaccine batch recording and automatic re-ordering – keep stock levels down and – ensure vaccines are constantly in stock, – permanently add the batch numbers to the clinical record. • Off license products on the shelf and removed from stock Stock Tasks for Inventory Manager • Vets’ meeting to discuss – protocols use of products – which drugs to keep in stock, – which drugs to use up and – which not to re-order/stock e.g. flea products, ear preps, antibiotics, anti-inflammatories, etc. • Staff meeting to communicate decision on drug stock and stock levels • Look at charity accounts CPL, PDSA, GDBA, RSPCA. etc. - altered pricing structure on computer and updated prices accordingly 5 steps in gaining and retaining control of stock management 1. Take control. 2. Know your figures: ‘If you can’t measure it you can’t manage it!’ 3. Simplify, simplify, simplify. 4. Ordering cycles. 5. Control Dispensing.