Create Your Own Vet Bill Template for Inventory Management

Vet bill template for Inventory

perfect we are opening up and so people that are signed in and attendees where are excited to show up you you hi everybody welcome it's Mike Connell here from oculus insights as people are signing in we'll just give him another couple minutes for people to sign in what would really help us is as you're signing in to help you get to know the the zoom screen you will see on the bottom of the screen a chat button and you will see a Q&A so what I would love if everybody can just sort of write down what country or what part of a country you're from that just helps us to know where our audience is strong as we're going on in the presentation and I'll introduce our speakers momentarily you'll see another button that says Q and a and at the bottom there and just if you have a question I'll be collecting I'm gonna be the moderator today I'll click the question and when our guest Danica and Sheila are done we will then have an opportunity for a question answer what I'd like to do is invite Sheila and Danica mature your your cameras back on and we can start with introductions welcome welcome so it's a couple minutes after three people are still showing up and it's amazing we've got people from just down the street from me and an Ontario 2 all the way to Switzerland to Texas at the California so what a great large group of people here so as I said if you just when you sign in there just type in on the chat where you're from and what city you're from and if you have a question just type it in in the Q&A button and then when we're done our presentation we'll get into the question and answer period so first of all I wanted to introduce Sheila stork Sheila is one of my colleagues at oculus insights I've had the pleasure of working at Sheila with some of our clients and Sheila is a LVT but Sheila is absolutely amazing at just processes and just business flow and how a business should run the operations in terms of the veterinary aspect so I've had a great pleasure of watching Shelagh work on some great practices and really improve their processes and I'm also really proud because I Danica Kent dosel she's the executive director of EMI resources and her expertise specialty is on inventory management and we work very closely with VMI and so Danica welcome and maybe if you just want to say a couple words about BMI before you start your presentation yeah sure VMI resources is a management company we're based in Texas and BMI Resources was created to oversee a group of veterinary hospitals called Brazos Valley equine hospitals in Texas and Brazil it started as a single practice and as I started to grow and expand and become multiple businesses they created BMI resources to manage and provides an oversight so there's some different components to BMI resources there's HR and accounting and inventory of course so I'm in their inventory side of things and we've just been kind of rolling along and expanding as the years go on so it's been really fun to see all the different projects that pop up and how things evolve over time and how the industry has changed even in you know it's a few short years so in a nutshell that's what we do and that's what I do well let's carry on with your presentation on inventory principles for healthy veterinary practice all right well thank you thank you very much Mike and Sheila and thank you to everybody who's jumped on today there are no shortage of webinars these days and so I appreciate you taking the time to to join in our discussion and we're going to talk about a few key things that you can implement in your practice to lay a foundation for successful and effective inventory management which of course translates to cash savings better margins and overall increases the value of your business we're not going to go deep into detail on any of these things because it would be a week-long webinar if we did but it's going to be more of a touch-and-go to give you some things to think about to maybe start to tailor a plan for your own practice so we'll just get started and see there we go in my experience there are six bricks in the foundation of inventory management establishing benchmarks have a finding the right person for the job identifying black holes collaborating and communicating building a plan and setting parameters these aren't independent like standalone bricks per se there's some overlap and they do support each other which you'll see is we start to work through these so we'll jump right into establishing benchmarks they should be hard and fast numbers that you can measure against over time this will help you evaluate the progress that you're making toward your goals and they should be formulas or functions that don't change so a standard is the cost of goods sold 25% for a cost of goods sold is the industry average at least in the United States and I apologize right away from my lack of scope in Europe and Canada and and anywhere else but a mic or any of our attendees might be able to share some insight here as you know incremental changes to cost of goods sold may seem small at first glance but equates to a pretty significant movement on the margin for example a practice that generates five million dollars in revenue with a expensive line of 1.5 million of drugs and supplies since 30 percent you know it's a 30 percent cost of goods number and bringing down the cost of goods just one percent would save them fifty thousand dollars moving on to purchasing agreements and I don't want to spend a lot of time here because this is particularly for those who own practices in the United States and I understand it works a little differently elsewhere but do you know what your purchasing agreements are with your vendors and this is something that's really important when you buy from a distributor they're selling to you at a price that is marked up a percentage over their cost and so the question becomes do you know what that percentage is and is there a rebate if there's a rebate are all products rebate eligible or are there exclusions are you tracking and reconciling the rebates that you are receiving for your purchases in a given time period you know you you might be surprised at how often there are errors here just because of how messy the data reporting system is between distribution and manufacturing and and some of the things that are actually out of your reach is a practice owner but if you can track those internally and access that detail it it can help you go a long ways and then we look at you know another benchmark in the in the purchasing agreement realm is the terms on your account you know what you have 30 60 or 90 days to pay he's all become negotiating points in your conversations with your vendors that of course affect your cost cost of goods and then another really important benchmark is the turnover of your inventory do you know what your turnover metrics are whether it stays to turn over a number of turns a year or however you're measuring it if you're measuring it in in units or if you're measuring it in dollars basically just getting a handle on this on your turnover can help you with so many things from identifying overstock and expired drugs to and the wastage that comes from those things to setting mins and maxes and reorder points and just overall increase in the efficiency of your pharmacy and this is a metric that is most commonly used as a benchmark and the practices that I work with at least on the purchasers level just because this is information that's pretty easily attainable by that individual whereas the cost of this number can sometimes be a little less accessible for the person that's managing the inventory and speaking of to do things to do these things well really does require a very dedicated person and the more dedicated that person can be to inventory control and purchasing the greater the health of your inventory in your business it's a bonus if you do have somebody that's already in your business that might figure but it doesn't have to be somebody that's already on staff I stepped into into the purchasing role in one of the clinics in Texas from being attacked previously and doing that for a couple years so I had a really good understanding of of the drugs and the demand of different drugs in that practice and that was absolutely an asset for me getting comfortable but I've also worked with purchasers that come in from the outside and are really quick learners and and they do wonderful so it doesn't have to be somebody within your practice but the right person should be very detail-oriented very self-motivated and a problem solver that isn't afraid to dig into the data and the challenges that come up somebody that really cares about the health and the goals of your practice and is flexible to change as inventory management and strategies evolve and probably the most important one they have the time does that person have other roles in the clinic this this will affect things like your stock levels for example if if they are answering phones and checking in clients and running anesthesia or if they're out of the clinic entirely on farm calls they're not going to be there to be able to make sure all the inventory is at the right level so they're probably going to be purchasing extra and just giving themselves a little more cushion which is gonna show up in your numbers I'm just trying to remind practice owners that inventory management can really be a thankless job and because I mean no one grows up or anything about sitting in a pharmacy and counting drugs and policing their flow is they move through a clinic so you know a lot of times the only things that they hear are I need I need or worse or out and and there's just a lot of weight on their shoulders managing this expense which is you know the second biggest expense of the clinic most of the time so if you've got to me that's willing to take this on the greatest thing that you can give them is your support your inventory manager can help you identify black holes and this is a big part of managing inventory well is finding out what these black holes are in your practice when inventory disappears because so does your margin and it can really quickly go negative and it's it can be kind of surprising when you start to look at the numbers but it happens fast it's a really slippery slope so an absolute requirement here is accurate inventory software and this means that all purchase invoices are entered transfers are recorded as inventory leaves the pharmacy and goes to other locations and as it's billed out of the clinic entirely once you have this data entered you're in Vince our excuse me your inventory software can help you generate reports to help you analyze these things that can help you compare your purchases to your transfers to your sales and any number of other things you know hopefully it can help you analyze your turnover and just all kinds of different metrics but it's your inventory software is only as good as the information that is input into it so having the software is one thing but having somebody that's dedicated to making sure all the important information is put in is is the key there and so when you look at analyzing the numbers and the data that's been put into your inventory software you can look at things like comparing the percentage of your pot product that has been transferred to what is then purchased so if you've if you've only transferred sixty percent of what you've bought in a time period you're probably over stocked if you've only build sixty percent of what you've sold you found another black hole right there so speaking of and this is a pretty common one actually whether it's intentional or unintentional but some doctors like to give discounts and and that's okay but do you know how much you're discounting and is it in line with how much you want to be discounting so having these numbers of having this information can really help you support that but to do it with discretion and are you billing at the appointment and are at the end of the week you know there's just so many things that that can happen and it all comes down to just sometimes you don't know what you don't know but accurate up to date inventory software can help you bridge that gap immensely question on that and the billing at the time of services I think as a veterinarian that's a huge aspect you have any data or if you read of any data is in terms of what percentage of items are missed if we don't bill at the time of service you know I don't know of any published data on you know a wide-scale I just know that it's something that in some of the practices I've worked with we've tracked over time because like I said you don't know what you don't know and so an example I can give you as a practice that I started with their cost of goods is really high and they were convinced that it had to do with what they were buying and how much they were buying and overstocking and paying too much and everything purchasing related and so once I started digging into it I just I knew that there had to be more to the equation and I started tracking like I was saying what we bought and comparing it to what was transferred and where it was transferred to and then what was billed for after those transactions and there could be huge discrepancies and so what I do reports like that now I kind of categorize it into okay you know 50% or more of this product wasn't billed and we know you don't have that much on your truck or in your cabinet or whatever you're working out of so I've got information on our own clinic level but I don't know of anybody that's ever produced anything on a wider scale but it was very eye-opening and it really it gave the clinic some information to re-evaluate how they do things and to better capture those things and support the doctors and billing at the time of service great thank you then this 20 gives you tips with the people that are listening in if they were listening to you they're like I don't know how much we do at the time of service I just would love if you had any tips on how they would measure that yeah and like within our practices like Brazos Valley they're you know they're all independently owned kind of sort of but there's some that or do a really good job of billing at the time of service and their faults are elsewhere and then you've got clinics that don't do a good job billing at the time of service and their collection numbers suffer because of you know because of that because billing is so far behind sometimes and and so you can kind of compare one to the next and see the ramifications of some of the behavioral things that that affect your inventory and your your numbers just before I'm sorry to interrupt you just won't remind people if you have questions we're gonna have time at the end for Q&A and just type in your question to the Q&A button we already have one question up there and we'll get to it in a few minutes thank you yeah and please do please keep track of questions because I know I'm rolling through a lot of information pretty quickly just because I don't want to take up all the time just listening to myself talk but I want to get through some things that I think are pretty important and just you know chewing on and spending some time with but I'll keep moving one other black hole area that I wanted to talk about a little bit is well analyzing re-evaluating your cost just excuse me basically is your profit is your hospital as profitable as it could be so money is more valuable as cash in hand than inventory on the shelf but do you know how much money you have tied up on the shelf do you know the value of the inventory you have on-hand and that's not just in your essential pharmacy but in your other locations as well in all your secondary locations your treatment areas in your trucks and ICU and those different locations every single secondary location that is stocked with drugs is it's basically like another stocked pharmacy and it really adds up quickly is everything that you're ordering necessary or is some of it ordered just because it's always been stocked and that's something to spend some time with with your purchaser especially if it's somebody that's new and stepping into the role and just trying to pick up where the person before them left off is having a good understanding of what is this is necessary and this is something that we're going to use a lot of and this is something that doesn't need to be on the Shelf or you know if you've been to a convention or a tradeshow and there's new product that you're excited about and you buy on it because it's on promotion then it sits on the shelf for six months you know those are just different things that they're little things but they do add up and they tie up your cash basically is what it comes down to another thing is your markups to clients so is your inventories do you have inventory software that's calculating that markup automatically based on what you're paying or is this something you're doing manually in either case it's really important to keep tabs on it because at least in you know the animal health world our major manufacturers do a price increase sometime in the first quarter of the year generally but when you have when you look at the human drugs those things change constantly and unpredictably and sometimes by really big swings so you really want to make sure that you're really waiting goes at least annually more often if it's something that you're doing manually and not using an inventory software to calculate another thing are the supplies and the sneaky drugs I like to call them these are the things like in the supply room elastic onon syringes believe it or not those often show up towards the top of a clinics high-volume drugs and supply lists and so you want to make sure that those are packaged correctly or bundled correctly in your billing codes and those costs are recouped and the sneaky drugs those are the things like the sedation bumps or replaced fluids or if you're on a farm call and you hand off a tube of you paste to a client those are things that often are missed in the billing and are just really important to watch for and sometimes you might have to set up a more targeted approach to keep track of those things or recruit a little more help from your Tech's to make sure that those things are done and then a closed pharmacy that's not something that's always feasible for everybody but if you can move toward that direction even if it's just little steps it can make a world of difference and so especially like if you're looking at building a new practice and you can make that happen please don't overlook it it makes it's so much easier to keep track of the drugs that you're paying for and make progress toward greater inventory control if there's not a revolving door I'll go back to sedation again if you've got open bottles of sedation in various places throughout the clinic you know that's a high-volume drug and it's one of the biggest culprits I see in this filling is it absolutely necessary to have multiple open bottles throughout the clinic you know or is that something you can keep lock down and keep a little closer tabs on as treatments for inpatients and the hospital are prepared usually those things are recorded to a tee but is it build this this shocked me a lot when I started really digging into some of this that hospitals in themselves a hospital like location is often a black hole just just in itself are transferred into the hospital for clients that are there and it never built just disappears so watch that one collaborating and communicating is so so important the practice owner needs to share information with the inventory manager and collaborate with that person on goals and targets the inventory manager needs to know what you want to accomplish and why so they're not flying blind or guessing or just overall being inconsistent with their management techniques sharing purchasing agreements buying group memberships your current cost of goods your target cost of goods etc all of those things are really important to communicate fully with the purchaser and this is going to be probably an ongoing conversation because it really takes some time to get a good understanding of what all these things mean how they work and how they affect the bottom line and your purchaser likely has some goals of their own maybe not so much if they're just getting started in their new but once they've been there for a while and have gotten comfortable in their role they're gonna see some things just because of how intimately they're involved with your inventory they're gonna see some things that you probably don't or may not recognize and some in collaborate and pick a few things definitely don't pick many pick one or two that or three that you're working on towards the same goals and so that you don't get overwhelmed or distracted or end up going down different rabbit holes and you're we talked about this just briefly before but your inventory manager really really needs support from the owner as well as the staff to accomplish the goals that you said particularly in the form of the time to be able to do the work that's needed and compliance so that whatever the agreed-upon strategy or approaches I mentioned this because change is often involved when you're trying to improve your inventory control in a practice and change can be really hard though for example talking about transfers again and stuff moving through a pharmacy if if staff is used to walking into a pharmacy and taking something off the shelf and then going on about their business and and you want to get a better handle on where inventory is going once it's unpacked out of the boxes and put on the shelf you want to get a system in place to record who takes lot and where if they're not used to stopping and writing it down or reporting it in any way it's not uncommon for there to be pushed back on those types of things and I understand because everybody is busy but this can be really really important and this can really change a lot of things in the practice so the pharmacy manager just needs your help and conveying that and and being consistent with that once you've targeted a few goals you use those goals to build a plan and sometimes I'm a big believer no matter what it is that sometimes the best thing you can have is a plan so once you've identified two or three goals then with your inventory manager you can start to build a plan to get there and so a plan to reduce cost of goods sold for example is going to have two prongs to it it's gonna have a purchasing hyung and an inventory control prong and and both of those things are not as cut-and-dry black and white simple they're multifaceted in themselves but we can you know keep them pretty separate this is purchasing or this is inventory control and you know plans to buy better might include a better purchasing strategy or comparing prices and pricing agreements among vendors and just simple negotiating your inventory control is gonna be even more dimensional with things like oh excuse me organizing your pharmacy or reducing inventory outside of a pharmacy or entering all the transactional dense data into your inventory software so you have complete purchase records and billing and transfers and all of those things it might be generating a high volume drug and supply list and developing a system of counting and tracking those drugs seeing what's going on with them calculating turnover setting mins maxes reorder points billing support all of these things there's so many things and so you just want to have pick a couple of them to focus on and go from there you just want to prioritize so that as you get things implemented it's easier to take on new goals and new projects and lastly a set of parameters that aligns with your goals and the benchmarks you've identified is good to help you know stay in line with those benchmarks and measure your progress so a system of counting is something I consider to be very foundational in setting your parameters for so many goals being able to compare what you have on a shelf with what your inventory software says should be on a shelf for example is the quickest way to find leaks in your inventory as it moves through the clinic and it's a great way to build data to give you the most complete look at things like stock levels over time turnover etc and so just some examples for using these metrics maybe your cost of goods is 32 percent and you want to get to 27 or maybe after you've your inventory manager has counted drugs for a while you learned that turnover for some of these drugs is 90 days plus and you want to rein that in you want to get to 60 or 45 and 30 days you know can you get extended payment terms or better pricing from your vendors these are all things that play into your goals that can also be measured by comparing with your benchmarks and so as you start implementing these strategies and gathering data and learning more about the health of your inventory in your business your inventory manager is probably going to come up with some new ideas and you're probably going to come up with some different targets and and that's fine that's actually it's good I think that's a good sign if you're changing and evolving because inventory management is not a static cookie cutter thing and as much as we would like it to be so you've just got to stay flexible and stay open to some of those things as they come up so to get the wheels turning and because we've gone over a lot of stuff really fast I put together this roadmap checklist type document and if you haven't received it already I know Mike's gonna send it out to you so this basically just recaps the stuff that we went over today and it's something you can spend some time with and work on with your purchaser and just to give you kind of some guidance as you try to decide what you want to tackle and and which way you want to go with some of this inventory management stuff because it's a lot it's a lot and it can be overwhelming and there's you can go down 15 tracks at once and not get anywhere you can pick a couple and really make some progress in a short amount of time honestly so that's just that and then nutshell I guess it'll be I don't know how big it is on your screen but like I said you'll get a PDF version so you can work through that and if you've got any questions at all I'm here for us even so I'll ask people if they have any questions just to use the Q&A button there and I'll start at the beginning so no place is better to start through the very beginning somebody just said what are the typical items when we're talking about cost of goods what are the typical items that you're seeing in that and the person made a comment it's a very good comment I find a lot of times that there are several items of others including cost of goods that could skew the numbers yeah absolutely so what we do in the practice I'm involved with is there's cost of goods sold and there's cost of professional services and the cost of goods sold includes just your drugs and supplies so it includes you know any pharmaceutical that includes your vaccines includes fluids it includes syringes and needles and and bandage materials those types of things it doesn't include shavings or you know feed it doesn't include those types of things that are in there for hospital care for inpatients now how about lab supplies yep but not external lab supplies or not not cute that cost just the internal not supplies yep next question and ask this goes back we were talking about doing random spot checks and the question is what period would you sample would you do a month a year weeks how do you like can you your spot checks so when we do it depends on what you're looking at if we're doing just spot checks on inventory levels that's done on a weekly basis in some cases we do it on a daily basis so if we're a clinic that has a lot of inpatient sources that are on fluids things like that fluids are something that disappeared quickly if you don't keep a good towel on them so we do fluids daily most of the drugs are counted weekly but we don't look at things like turnover and those types of Metrix except for quarterly and so I'm just going to say I know what my own practice they're our top let's say eight items of our double-a items we're gonna categorize the items that we sell the most and have the most value we count those on a weekly basis because it really helps us identify ones that we have not built or transfer issues but typically it's what we haven't built and it's much easier to remember when we haven't dispensed a high a and a high cost item after week as opposed to over several months and it really makes sure that everybody in our organization knows that billing is really important and it's important that the inventory manager you know is aware and kind of has you know in the back of their mind what some of those key items are so you know if it is after hours or something like that and someone comes in and grab them you know they're doing visuals and checking okay where did that go knowing where oh so we don't have to have such a large quantity on the shelf in knowing you know how quickly we can get it in and things like that so the next question is how many terms would you want for your top fifty items to have for a year if you're aiming for a cost of goods of twenty percent for example to allow for the many purchase of supplies that are sold in the last lab coats a lab cost rather or supplies so what is your recommendation there on terms of the year our goal is for everything across the board twelve turns or thirty days to turn over for everything and that's just because of the billing cycle and the amount of money that we want or not don't want tied up on the shelf so if we have everything turning over in 30 days or less then we're pretty comfortable that we can if we're on top of our billing and our collecting we can buy it use it pay for it or collect for it I'm sorry before we have to pay for it no I think that's really the goal that's an astounding number for Annie rocket so kudos to you and I should have interrupted you when we were talking about it but somebody asks can you explain what a closed pharmacy is and I have a question on that as well yeah so we a closed pharmacy is essentially what it says it's it's a it's a room where the inventory manager sits they have all the inventory there with them under lock and key I mean you're probably not going to have all of your fluids there anything that's in pilot quantities but as much as you possibly can keep locked up you do at least of the things that you're tracking so we're not probably counting and tracking syringes and needles those maybe don't need to be in the pharmacy that's locked but all of your drugs definitely we keep in there things that are high-dollar high-volume things like I rap ERP those types of kits the vaccines are in a fridge and a pharmacy just that's we keep it locked just to prevent stuff from walking out the door in disappearing because that actually probably contributes more to your cost of goods than the price you're paying for your drugs so it can it can become a disaster in a hurry if you if you don't know where that stuff is going and if you don't have a system you know if you have an open pharmacy but everybody's really good about saying I'm taking this this quantity on this day that's going to this horse or whatever the case may be if people are really good about recording what they've taken and used then it's maybe another thing but generally that's not the case so I've asked both Sheila you just another question is if somebody says we have a small clinic you don't have a closed pharmacy how do we stay on top of the pharmacy do you have any tips on that I would suggest if you've got what if you've got somebody that can dedicate time to that pharmacy I know a lot of cases where it's a small clinic you don't necessarily have somebody and you can't justify having somebody that it's just for that role entirely but if you can give somebody some time you know part-time or whatever it is to focus on the goals that you want to put in place there and then make sure that you have the support of this around them you can get it done it doesn't have to be especially in a small pharmacy where you maybe only have one or two doctors it doesn't make sense to have somebody that's you know they don't they don't need to be policing it all the time so but if you know what your goals are they can dedicate some time to that and you know Danica touched on something very big there and it's the support and using all of the support staff so you have one person who may oversee it and be responsible for but this is where knowing your key items what you're watching for on a weekly and in this case it may be you know bi-weekly that you're watching them and if that individual doesn't have the time to do it you know on this day they may be assigning someone do the inventory checks on those items and you know so you it's a team approach yeah and this is where the your data plays a good role too if you know who's using what or how much is transferred to which doctor and you can show them the numbers say this is what this is what went into your inventory in the last quarter the last month whatever your however tighten is drilling it down and say this is what you build up that inventory the knowledge is power and most don't realize if they're not billing for everything or they don't realize the gap that exists between the inventory that's been transferred to them and what they've build so the more the numbers really speak volumes way more than somebody just like preaching and nagging and saying we got to do this we got to do this we got to do this if they can see numbers to support why we're trying to do this that makes progress happen a whole lot faster yeah finally you can tell the practice owner that you have X amount of dollars or money tied up on the shelves and if you did it you'd have this in your bank account they're much more open to changing their inventory systems speaking of systems another question is what systems do you use to identify reorder points and reorder amounts that need to be changed due to seasonal changes or and how often do you run that system this has been an endeavor I have tried four or five years to find and inventory software that does this completely and does this well and I haven't found it yet we have invested a lot of money to try to build it and it requires a whole lot more money than what we have so basically what I do is it's a hybrid of the inventory reports that our software generates in terms of purchases and transfers and what's been sold and an excel sheet that I just built and it shows over time we do you know weekly counts it shows what the counts were for each product every week or whatever the time period we're looking at which is I keep a running sheet for a whole year but we analyze it quarterly and when you can compare what your average inventory is and factor that in with your purchases in the time period you can come up with turnover numbers and so with those turnover numbers we can look at and say okay we're overstocked or were understocked or we're just right and you can play with those numbers and see where those numbers should be to turnover in the time period that you're targeting so you know whether you know we've got too much on the shelf the average inventory on the shelf is just too high if we lower it it'll be just right and you can set your mins and maxes and reorder points based on that it's a it's kind of a it's all kind of a workout to get there it takes a lot of data entry or a lot of data aggregation I guess is maybe the more appropriate term for it but it's really it's not a it's not a big deal it just it's something that your inventory manager they just get used to you know once a week I do these counts and then they have those counts off to me and I do all the analytics for it but you know all those formulas and stuff they're all out there in google land and I found the best way for me is I just looked at my age it's my main distributor and said send me an excel sheet per month of what I bought and they were able to run that in you know 20 seconds and from there I just said okay here are my busy seasons and I figured out what is the minimum I want to have with the map like honey what's the time period for a minimum and what's the maximum and I was able to make my own and so I knew for a column product that if I needed if I sold 24 and a 12-week period I sold we if I wanted to have one and a half weeks as a minimum stock of f3 and her three weeks is my maximum I'd 106 yeah that was then we can just really look at every one of them and they were tagged that we knew this is the minimum of maximum because yeah I agree the software systems that we have in medicine are not to job yeah and it's I mean it's it's a lot but at the same time it isn't you know it's how do you eat an elephant one bite at a time and yeah and as you get those systems in place it's there's another day another question it's a big question so maybe I'm gonna rephrase it but they ask what's the processor or the road map that you would use to start from scratch to implement a software system to track inventory I think you sort of talked about it a little bit now maybe there's some key things you'd want to start first because like I think we could probably spend two hours just talking about this um so are we talking about a systems or like like strategy are we talking about getting an inventory software out there I mean I think it's the inventory software and I think you know you know we every most practice management software's you have a good system work you are mentors to yep yeah so the first thing is just making sure all the purchase invoices are put in and depending on your software that can be a little more complex than it sounds you know some of them the software we use for example has everything from purchase requisitions to purchase orders to purchase or seeds to purchase invoices and each one of those things does something different so one of those like the purchase invoice updates the price in the system whereas the purchase receipt updates the stock level so you just gotta have a good understanding of how your software works there but step one would be to make sure that you have all your purchase invoices entered into the software and then that's gonna give you your purchasing report data that's really invaluable you just got half that and then from there I think it's really important to know where your inventory goes as it moves through a clinic so we don't the hospitals that I work with nothing is build out of a pharmacy everything that the only transactions that have to do with the pharmacy are the purchases that come in and the transfers that go out and so then from the secondary locations which is what I refer to as anything but the pharmacy so if inventory goes it's received into the pharmacy but then it goes to a best truck or it goes to a surgery room or it goes to a treatment area or to the hospital wherever it is there's a paper trail in the system that shows this went there and each of those secondary locations they can only receive inventory from the pharmacy or they can bill it to an end client and so once you have that in place and your transfer system kind of outlined then it just kind of follows along wherever you need it to go and you can generate reports based on that so then you know what went where and how much and and you can tell was it build from that location or was it not and that that was the biggest thing for us and identifying the inventory that was disappearing and where it was disappearing from and you know who was responsible for it and sometimes it's not it's not that easy so like I've mentioned before the hospital is a black hole if inventory was being transferred to a hospital and billed out of there you don't necessarily know what doctor it's under so it's it's a big part of this is just identifying where the issues are and then building a plan too that works for your clinic to rectify that issue another question is what shrinkage how often would you compare amount purchase with amount sold and what period would you search for we do quarterly next question did you mention a 25 percent benchmark and I think I think you know the question he asks this gentleman asked shouldn't we be building a target based on where our revenue comes from you know more or less product versus service revenue and and how that really compares to our pricing markup strategy so some practices may be too high 25 percent or may be too low yeah I mean it definitely varies by the practice and how that what that practice what their demographic is what type of that medicine they're practicing it definitely varies there's some clinics that I work with that are down in eighteen percent and they you know one of the big difference one of the big things that sets them apart is they don't really stock inventory they send a lot of stuff through an online pharmacy and so there's just there's so many variables that will affect that one question is in terms of the cumecs inventory controlled substance vending machines do you have any experience with that valuable do you find their system yeah actually we had one of our one of our Brazos Valley clinics had a big cumec system and they just got rid of it and actually were able to get rid of it just because of the inventory system systems that we've put in place to be able to track the flow of inventory through software or through the clinic there were some glitches with the cubix I think in communicating with our inventory software and so they were having to kind of juice there was some redundancy in the reporting they were having to pull reports when qyx and having to pull reports from the software and then trying to line them up and you know it was there were definitely some advantages to it as far as knowing what inventory was going where but ultimately they were able to get away with it or get away from it and save the money that they were spending on that system just with some pretty simple management then the final question is and what systems you use to regulate the quantity on hand ordering supplies which are not sold so how much are the overall terms per year affected by that's if your reorder point for the pharmacy are set to 12 terms per year I'm not sure I follow can you repeat that what system do you use to regulate the quantity on hand that are not worthless let the amount of supply that are not sold so I guess that that just ties into your overall inventory terms and I guess yeah so like we're talking about stuff that you have on hand but you don't go through frequently yes and how to gauge how much of that to keep on hand yeah it ties back to just having a system of counting is so valuable and it's um in some ways it seems kind of archaic and I get that but if you learn so much from counting your inventory and even if it's just a sample of your inventory like we started with our highest volume drugs because we figured that if we can figure out what's happening and what the behavior is around our high volume drugs and we can make any Corrections need it there it just spills over into everything else and that's essentially what happened and so once we got those under control because those were things that made the biggest impact on the numbers then we were able to look at things like stuff that you maybe don't stock a lot of or stuff that you know like you're talking about and you can adjust from there but if you've got the counts and you know you know if you've got something in particular you're wondering about that maybe isn't in your high volume drug realm you can still track it you can pinpoint that and track it and just see how quickly is it moving what is the turnover look like for this and then you can adjust from there and you don't have to do it long you can do it or any period of time that you want you can do it for a month you can do it for order you can do it and you can I mean there you can simplify it even further and look at what was our beginning inventory what was our ending inventory and you're not exactly taking into account the transactions that are her in between but it can give you a rough idea of where you're at and how much is sitting there not being used and adjust from there things that you don't necessarily bill for sorry can you say that again you worry about like just the general supplies that things that you don't billed for um it depends on where they fall so when I run these reports for what a clinic buys that's based on your inventory software it'll it'll show everything you've bought in a time period if you've entered your invoices accurately and and you're up to date on it but it'll show everything from stuff that's high volumes and stuff that you've bought twice and maybe spent thirty dollars on throughout the year so it depends on where it falls on that scale is how much we worry about it but um the we do look at it the stuff that's higher on the list that's a high-volume thing we do look at it and say okay this is costing us X number of dollars and it's not something we want to just give away so make sure that we are capturing those costs say in a bandage code or an injection code or whatever that might look like just to make sure that the the cost is recouped there it may not actually bill it and pull it out of inventory the way you might like it to but as long as the cost is recovered your spirits step in the right direction yeah I think cost recovery is a big part yeah Danica and Sheila I want to thank you we've been going on for almost 15 minutes we like to keep our webinars or boy we've had a lot of information great questions thank you very much and we will be sending on a copy of the PDF that Danica was talking about you either get that later today or tomorrow so thank you all very much and there will be a recording of this that's on our veterinary resilience guide if you want to share any colleagues your friends or anybody else for your office that wasn't able to attend this live thank you very much both of you thank you thank you