Inventory management is amongst the high-level challenges for every diagnostics lab. Hiring an essential analytics expert might help. However, right from minimising manual entries to reducing manual efforts, redundant efforts, and implementing control, better algorithms and tracks add up to interrupt our key goal of improving inventory as a vital part of the lab. Apart from these, there are also a few common inventory problems that are hard to track & fix and require your attention to improve usage; and drive better business outcomes.
Problem 1: Wastage due to expired stock
Labs often fail to keep/maintain track of stock expiry dates which results in a heavy quantity of wastage. The higher the volume of a stock in your store, the higher will be the wastage; if a systematic approach isn’t followed to control it. On the other hand, tracking expiry can be tough due to several issues such as having too much, incomplete, complex or no data in hand. Such challenges highly affect the cost for a diagnostic business, especially for mid-size to larger labs and enterprise centres. In the worst-case scenario, prioritising expiry is another bottleneck for a lab. This calls for a better approach to handling expiry to prevent wastage.
Solution: Keep track of near expiry and take decisive action
Keeping track of near to expire stock is of utmost importance to take better action on them. However, it is also important to re-evaluate stock at least before 30 days and cross-check them across the consumption for it, to get better knowledge for expiry. This way labs can make better decisions before expiry takes place, only to prevent wastage.
Problem 2: Wastage due to sporadic consumption of stock at the device level
When labs do not maintain machine calibration, quality check and other quality analysis procedures, the inventory is highly impacted. As this causes over-consumption (sporadic) due to bad QC, the stock gets wasted indirectly and may affect the quality of testing as well. Therefore, such hard-to-locate challenges must be eradicated.
Solution 2: Track and maintain stock consumption at device and test level
Despite maintaining the QC regularly, we must also enable tracking and maintenance of stock consumption at the device level and test level to have a better understanding of this problem. This will enable smooth consumption without any potential leakages or we can say unnecessary wastage.
Problem 3: Inefficient Capital management by overstocking
Overstocking is another very crucial challenge that labs mainly ignore to consider as one. Although, overstocking is the biggest reason for wastage. It does not just show us how inefficiently we handle our monthly capital expenditure by also hampers conversion, leading to a heavy loss for months.
Solution 3: Order based on past consumption
To overcome such problems, it is essential to access past consumption regularly while placing orders. While we follow this approach month by month, it improves usage efficiency and gives us enough knowledge about consumption against purchases; helping us with better management of the inventory.
Problem 4: Unavailability of stock at peak time
Stock unavailability at peak times can lead to a heavy loss of customers, loss of business and loss of a good reputation; as you lose a great opportunity to scale. The cause of unavailability of stock can be due to several reasons that altogether points to poor inventory management. Some of these reasons might also match the above challenges.
Solution: Plan purchase orders properly based on past consumption
When you have enough, appropriate and better knowledge of your past consumption, you can evaluate the peak times of business well. A seasonality based analysis of consumption over a year is of utmost importance to study such problems and derive loopholes to get better solutions for your inventory and for your business. Solutioning such a key problem even helps against something like a pandemic.
Problem 5: Responsive stock management rather than preventive maintenance
Inventory handling and management for a diagnostic lab is typically performed using a responsive approach wherein data is looked at after an error/problem is depicted. This is why most labs fail at planning a better inventory for their business despite using feasible management strategies. Preventive handling, managing & maintenance of stock can improve the overall flow of stock data, thus, minimising the occurrence of errors/problems beforehand.
Solution: Have access to real-time data
Having access to all data associated with inventory such as stock data, stock consumption data, expiry data, and many others, in real-time is the key to enabling a lab to plan preventive strategies. By following them timely, broadly helps us with error control, leakage control and more notably cost saving.
To conclude, having a lab inventory management system is extremely essential that sets a tracker to all at stock, consumption, expiry and provides better inputs to verify quality suppliers and purchases.