80 AN EXCERPT FROM 101 VETERINARY INVENTORY QUESTIONS ANSWERED
your questions answered Q
How much inventory per doctor is adequate?
James E. Guenther, DVM, MBA
Most practices suggest having inventory levels on drugs and medical sup- plies of $15,000 to $18,000 per full-time-equivalent (FTE) doctor. These are suggested levels, but should not be considered as an ultimate level. The goal should be to determine the optimum level for your practice and to make adjust- ments as conditions change in the economy or at the practice.
A
An accurate physical count of inventory will help establish the ideal level for a given practice. Start by performing a physical count at least annually and then determining the total cost of the products. Divide that number by the number of FTE doctors to arrive at the inventory value per doctor. At the same time, compare actual product levels with corresponding quantities shown by the inventory management system and, when necessary, adjust your computer inventory quantities to match actual levels. This is yet another instance that underlines the importance of making regular, consistent entries in the inventory management system and on client invoices.
Another factor to consider is buying habits. If the practice can order as needed because of local warehousing and same-day delivery, the inventory per FTE doctor should be lower. If the practice is in a remote area, where delivery time may be a couple of days, the inventory level per doctor will be higher. Understanding your location and buy- ing needs will help you determine an optimum inventory level for the practice, and consequently for the FTE doctors.
Yet another consideration is the type of practice. If the practice focuses strictly on wellness, with a limited number of sick patients, the level of products needed will be lower than for a busy critical-care type of facility, where the level of inventory will be higher because of greater demands for product.
Excerpted with permission from 101 Veterinary Inventory Questions Answered (AAHA Press 2010). To order, go to
press.aahanet.org.
Trends magazine, September 2011
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