Practice Tips

Equine Veterinary Practice – Inventory Management

Leadership

• Without leadership on inventory process and management, the project will fail.
• Inventory is generally the first or second highest cost to the practice. If the owners/partners don’t prioritize this, there is a leadership problem, and it might not be worth the time to develop an inventory program. This is sad but true and we have seen this many times in many practices.
• There needs to be an inventory champion in the practice that is an owner. When team members are not aligning to new processes, it is up to the inventory champion to deal directly with non-compliant offender’s.
• Leadership of inventory management is one of the key indicators of practice health and profitability.

Prioritization

• The 80/20 rule applies to inventory.
• 80% of inventory cost (and profit) comes from 20% of your stock.
• These items cost (and make) the most money so focus on these first.
• Pick the first item you want to manage and create a process for managing this item.
• Once that is done, follow the same process for the other items you want to manage.
• Explain to the team the cost of poor inventory management and slippage and how it affects them. For example, if inventory is managed properly, profitability increases and there is a better chance for a wage increase for non-veterinary staff.

Training

• Create a project plan with expected outcomes you can share with the team. Set expectations and outcomes. Begin with the end in mind.
• Train staff on an individual basis on your process and set expectations. It is often difficult to get many people to meet at the same time because of equine practice schedules.
• The worst offenders of poor inventory management will be the hardest…you know who they are. Stay on top of them on a consistent basis.
• Provide reporting of historical issues to the team, seeing is believing. Point out the issues and explain how the new processes will result in better outcomes.
• Consistently measure results and share these with the team as the program is rolled out.
• Start with one item, not everything and make a plan over a 12 month period to have your process in place, don’t try and do it all at once because it will not work and the processes will get abandoned.

Timing

• Equine veterinary practices are busy from mid-February to mid-summer so don’t try and start an inventory plan/program during these times because it won’t work. People will not be focused.
• Start a plan in September after the summer holiday season when people are in the practice.
• Create a plan for a new process for a month and then adjust as needed.
• Have a goal of having 50% of your inventory plan in place for AAEP and that is a deadline that cannot be changed.
• Be flexible in timing to meet your practice needs but be firm on process and outcome otherwise the process will not work.

Supplier Management

• Almost every supplier in equine distribution has inventory experts on staff whose sole job is to help practices with inventory management. USE THEM!