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Inventory management.
The very thought of it can send shivers down the spines of dentists and dental nurses. Does this ring a bell?
Maybe it brings back nightmares from your high-school or student cashier job when you had to spend endless hours marking prices on store items and making sure shelves were well-stocked.
Or perhaps you view inventory management as a tedious, unimportant chore that saps your energy and leaves you feeling tired, irritable, or downright grumpy - or all of the above.
So let’s admit it: inventory management is not what lured you into dentistry.
But are you allowing inventory management to be a more painful process than it needs to be?
Inventory management and ordering can often throw Australian dental practices into a tailspin. Let's face it, few practices truly appreciate its value. Instead, they opt for the illusion of speed, overlooking inventory management altogether.
Staff members may grab what they need from the stockroom as required, thinking it's the best way to boost productivity and enhance patient satisfaction.
Don’t get us wrong. We are not blaming you. We know you’re so busy trying to deliver optimal oral health that inventory management is the least of your worries.
You may want to declutter and organise your stockroom, but you have bigger fish to fry. Nevertheless, neglecting inventory management is an approach that can cripple profits and productivity.
According to Dentistry Today, many dentists wish they learned more important lessons about inventory management in dental school. They claim that dental practice ownership is not a course taught in dental school, where they could only learn half of what they need to be successful dentists.
Have you found that your degree didn’t fully prepare you for the business side of dentistry?
This post aims to ease some of your frustrations. Let's explore deeper into what inventory management really entails and how effective inventory management can simplify things for everyone involved— you, your team, and most importantly, your patients.
Inventory management is essentially the process of ordering, storing, and utilizing the supplies necessary for your daily operations and procedures.
Effective inventory management helps you determine which items and quantities to order, ensuring you have the right materials in the right place at the right time.
It's important to note that inventory initially ties up capital. Once it's utilized, it transforms into revenue. Consequently, excess inventory can drain your practice’s finances and negatively impact your bottom line.
The three basic steps of dental inventory management include:
One key metric to measure inventory management success is inventory turnover (the number of times inventory is used in a specific time period). To calculate the inventory turnover ratio, you need to divide the cost of used items by the average inventory for the same period, meaning that:
Inventory Turnover Ratio = Cost Of Used Items ÷ Average Inventory
The golden number for a dental inventory turnover ratio should be between 5% and 8%, indicating that you use items and restock your inventory on a monthly basis. On the flip side, a bad inventory turnover is between 13% and 16%, while average is between 9% and 12%.
Fortunately, traditional inventory management methods, which rely heavily on manual counts, have been largely replaced by technologically advanced systems. These modern systems are designed to streamline inventory processes, making them quicker and more efficient. However, the dental industry often lags behind, still grappling with outdated inventory practices.
Despite evolving technology, 95% of Australian dental practices still use pen-and-paper spreadsheets, Excel, sticky notes, whiteboards or don’t track inventory at all, which is a time-consuming, redundant, and prone to errors process.
As a dental professional, inventory management may not be your idea of a rollicking good time. Still, we guarantee you that a stock management and ordering system specifically tailored for the dental industry will eliminate thorny challenges and take many tedious inventory-related tasks off your plate.
The days of pens, papers, spreadsheets, inventory counting assignments, endless stacks of boxes, and the dreadful “just-to-be-safe” recounts must come to a close in the Australian dental practices.
If you're still embracing the old-fashioned approach to inventory management, it’s time to shake things up and improve your practice’s time management and profits.
Effective inventory management is essential for the smooth operation of your dental practice.
While it may seem like a menial task, proper inventory management is crucial—it can be the difference between undermining your practice’s budget and time management or maintaining them effectively.
Here's why effective inventory management is the cornerstone of a thriving and productive dental practice:
Imagine this scenario: you place an order, but the product you’ve ordered is kept on backorder, and you can’t track it. Or just as bad, the supplier ships the wrong item or invoices you twice without you spotting the errors.
It’s a familiar scenario in many dental practices: inventory mismanagement leads to numerous issues. On the flip side, excellent inventory management helps you avoid mistakes in purchase orders and ensures you receive the right items exactly when you need them.
FYI: A stock management and ordering system like Invedent allows you to track backorders and gives you access to a product list with the latest products from all manufacturers, so you can save time by having everything in one place. The system also allows you to spot errors (e.g., if a supplier invoices you twice for the same delivery) and track inventory across multiple locations.
Effective inventory processes help staff members increase their personal productivity and free up time for more meaningful tasks around the practice, minimising time spent counting and controlling items available in the stockroom.
A well-managed inventory not only saves time but also boosts efficiency, as staff members can quickly locate exactly what they need in the stockroom.
FYI: An automated inventory management and ordering system saves you a bunch of time on stock operations. Instead of manually counting items, the system scans stock in and out and lets you know exactly where items are placed on the shelves. For example, Invedent comes with QR code labels so you can quickly identify the items you need and pick them up before starting your workday.
Wasted, expired items and lack of items can all stall the progress of a busy dental practice and negatively impact the bottom line and profitability. Overspending your budget can spell doom for your dental practice - and this is exactly what effective stock management helps you avoid.
Efficient inventory management ensures you know exactly what to order and when to order it, helping you avoid the costly mistake of overstocking supplies in an attempt to prevent shortages.
FYI: Automating and simplifying your inventory processes will work magic for your practice’s bottom line. For example, Invedent was specifically designed to help you shop around for the best prices so that you can manage spending responsibly. Better still, the system gives you full visibility into your stock levels and accurately predicts demand, meaning that you will never have to throw expired stock again or waste money on unused stock.
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