Study Set Content:
has a strong and
direct effect on a pharmacy’s return on
investment.
Proper Inventory Control
is also important because
a pharmacy must have a well-functioning
inventory to properly serve its patients. It
must have products consumers need in the
quantities they need them.
Inventory Control
2 GOALS OF INCVENTORY CONTROL
1.Minimizing total inventory investment.
2. Carrying the right mix of products to satisfy
consumer demand.
Methods of Making an Inventory
In many stores, the inventory of stock is taken
not more than once a year, although more frequent
check-ups are made on stocks of candy, tobacco,
and fountain supplies. A careful annual inventory is
necessary for the accurate determination of profit in
a business.
It is worthwhile to plan the making of an entire
inventory over a single weekend. Preparations
should be made in advance to facilitate inventory.
Inventory sheets that are serially numbered should
be prepared. All types of merchandise carried in
any given fixture are listed on the sheet with details
as sizes, colors, or any other assortment factors.
Pricing the inventory is the next step.
Study of Inventory Management Problems Phases:
a. inventory control
b. proper location of merchandise
c. economics involved in ordering stocks
d. how, when, and where to order
e. current product information
aided by the “wantbook”
1. Intuitive Method
set of systematic wantbooks
Systematic Wantbook Method
most common method in practice today and
the least efficient
Intuitive Method
Items are recorded in the wantbook when
the number of units of stocks reaches a
particular amount of units ordered by the
pharmacy manager or the proprietor.
Intuitive Method
In this case, there is a wantbook for each
direct account and each major wholesaler.
Items are recorded in the appropriate
wantbook based on the need as indicated
by an order card located on each product,
or a strip of cardboard on the edge of the
shelf. The information on the card or strip
simply indicates the minimum and/or
maximum quantities—the number at which
the item is ordered and the quantity to
order— to bring the inventory to a maximum
level. The selling price and sometimes the
cost, in code, are also included. The items
are ordered at the appropriate time, at
which point the quantities and date of the
order are recorded in the wantbook. When
the order is received, notation is made of
shortages and related information.
Systematic Wantbook Method
One of the simplest and easiest inventory
control systems to implement.
Open-to-Buy Budget System
One of the simplest and easiest inventory
control systems to implement.
Open-to-Buy Budget System
The rationale underlying this method is
simply adjusting each month’s purchases
based on the increases or decreases in
sales from the previous month in
comparison to the corresponding monthly
sales a year ago. Adjustments must be
made of any overbuying during the previous
month.
Open-to-Buy Budget System
A purchase budget is established for each
month.
Open-to-Buy Budget System
Ideally, the stock record card should have at
least 12 columns to record data for each
month. The heading of the stock record card
normally shows the supplier’s name,
address, the discount, and other sales
terms such as the date when the company
closes its books. After the general
information has been recorded for a
company, the name, size, cost per unit, and
the minimum and maximum quantities of the
product to be stocked are recorded as
indicated by the column headings
Stock Record System
deals
with both how much to purchase and
appropriate reorder point, or when to buy.
Economic Order Quantity (EOQ)
The most efficient inventory control method
provided the pharmacist has the necessary
technology for this, which is a computer.
Perpetual Inventory method
The advantage of the OTB budget system is
that it is much easier to make twelve small
adjustments each month, than to make one
large adjustment at the end of the year
when the physical inventory is taken.
Open-to-Buy Budget System
Also the EOQ is the amount to buy that will
keep total costs at a minimum.
Economic Order Quantity (EOQ)
Economic Order Quantity (EOQ) Formula
EOQ = Q = SQRT (2DS/CI)
