10 Tips to Control Your Vet Clinic’s Inventory

It may not sound like any fun, but inventory management is easy to do and can save you money in the long run.

Injectable drugs and others supplies should be rotated—the oldest products within easy reach and new arrivals at the back.

Phil Zeltzman, DVM, Dipl. ACVS

Inventory management may not be the sexiest topic, but it is a key area you should focus on. It’s easy, it doesn’t take much time, and it can save you a significant amount of money. Here are 10 tips to help you better manage your inventory.

1. Consolidate products and manufacturers 

Trying to pinch pennies and find the absolute best price on every product requires expensive labor. If you buy additional products from the same manufacturer, you might get a bundling promotion. This is a discount offered when you combine, for example, vaccines, medications and paraciticides into one order. 

2. Choose one major distributor 

Having your ordering person compare every product ordered across several suppliers is laborious. By consolidating your orders with a single distributor, you very likely become a “key account.” A key account gets better (and consistent) prices, service and attention from the outside and inside sales reps.

3. Get two people involved 

Ideally, you should choose one trustworthy person to do the ordering and a different person to unpack products. They can switch jobs every once in a while. This will help you catch mistakes and decrease the embezzlement risk. Another benefit is that you will have cross-trained a backup to handle orders in case one person is sick, goes on a vacation or quits.

4. Count your inventory 

This might be a requirement, depending on your clinic’s tax structure. Even if it is not mandated, conducting an inventory will help you keep track of how much money is sitting on shelves. You can compare the numbers to the previous year, to industry standards and to colleagues with similar practices.

5 Pick a “key vendor” day 

Random, unscheduled visits from sales reps can be frustrating for everybody involved. Instead of allowing this to happen, you can schedule half a day or a full day, once a month, to meet with key vendors and manufacturers. Products and trends change periodically in our industry. Reps talk with your local colleagues and may have important information for you. Ask reps about what they are hearing and seeing and what new discounts they are offering. Used correctly, a good sales rep can be a wealth of information.

Used correctly, a good sales rep can be a wealth of information.

6. Rotate your inventory 

The most recently ordered products should be placed behind the oldest ones in order to decrease the expiration risk. Everybody knows that, but are you positive it is being done at your practice? You may be able to return and receive credit for expired drugs and products if done in a timely fashion. YTrain your ordering crew to keep track of expiring drugs. The same applies to pet food.

7. Take advantage of “lunch and learns” 

Rather than accepting random proposals, decide what your staff needs to learn. You most likely will find a sales rep who can address that topic at your clinic. You could delegate the invitation task to a technician or practice manager—with your guidance, of course. In addition, manufacturers might schedule meetings in your area.

8. Put your inventory on a diet 

Do you really need to carry four different NSAIDs, six different shampoos, eight eye ointments, 10 antibiotics and every single parasiticide available? Does it make sense to stock TID antibiotics when similar SID options exist? Can you switch to generics? Decide what makes sense for your practice and patients. Attend national CE meetings to learn about parasite resistance. Schedule quarterly meetings with your team to decide which new products you will use and which products are redundant. And send back some of those products for a credit.

9. Color-code products 

Color-coding drugs and products prevents you from running out of critical supplies. “Green” products are not critical. If you run out, you can order them and get them within a few days at the most. This typically represents about 50 percent of your inventory (by units sold or used, not by sales). “Yellow” products, or about 30 percent of your orders, need to be watched more closely. It is important not to run out of those.

So about 80 percent of your inventory is not that critical, following the famous Pareto principle. And then there are the top 20 percent of products— color-coded red—that you should never run out of. What are these products? It depends on what your practice focuses on and your areas of expertise.

10. Consolidate orders 

Sure, being able to order a product before 5 p.m. and receive it the next day at no additional cost is a wonderful luxury. However, everything has a cost. By consolidating orders, you will have fewer deliveries, fewer boxes to open and break down, and fewer invoices to pay. When you consolidate orders, everybody involved saves time (and you save money), and it decreases the obscene amount of shipping materials we have to deal with.

Inventory management is a critical part of any well-run practice. If you keep a close eye on your inventory and ordering crew, you are certain to keep money in your pocket instead of letting it gather dust on your shelves.


Dr. Phil Zeltzman is a board-certified veterinary surgeon and author. His traveling practice takes him all over Eastern Pennsylvania and Western New Jersey. You can visit his website at www.DrPhilZeltzman.com, and follow him at www.facebook.com/DrZeltzman

Originally published in the April 2016 issue of Veterinary Practice News. Did you enjoy this article? Then subscribe today! 

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