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Introduction to Inventory Management

A long time ago, in a galaxy far, far away, I was freshly tasked with managing inventory. At the time, I was brand new to the practice. I always wore several hats and was the “Jane of all trades.” Need help fixing this piece of equipment? I'm your gal. Need someone to put together a custom mailing list? I've got you. Need someone to calm down a grumpy client? Sure thing! So, as a “yes person,” when I was asked to manage inventory, I happily agreed to a fun new adventure. I was in for a surprise.

In what feels like a different lifetime, the previous inventory manager was leaving the practice and trained me very briefly before leaving. As she was reviewing the current processes, she said, “When you shake a bottle, and it feels low, order it.” I vividly remember standing in the pharmacy, unable to wrap my head around it. I kept thinking (and asking), “What does that even mean? What does ‘low’ mean?” For me, it was much too subjective and could be interpreted so differently.

I kept asking the question in a few different ways, hoping to get a more concrete answer, but it never came. That was the bulk of my training on how to manage inventory. To say that I struggled in the beginning is a giant understatement. I did not order things because I did not even realize the practice carried them. I ordered things at the wrong time because “low” to me was not the same as low for the practice. I also ran out of things because no one told me it was low.

Now, to give you a little context, I have always considered myself a high achiever, and I care deeply about how well I'm performing and doing in my role (think Hermione in class). Not only was doing well vital to me personally, but I knew that my challenges were affecting my team. I wanted them to be happy with me, and I did not want them to be frustrated that items were running out. Coming into this experience and struggling right off the bat really shook the confidence I had in myself. I did not know how to improve and I struggled emotionally, knowing I wasn't doing a great job. No one at the practice had managed inventory before, and I was really on my own little island.

The problems and challenges seemed to compound. My anxiety got a jump start pulling into the parking lot; my mouth would go dry, I'd feel a little queasy, and then I'd soldier on because I did not know what else to do. At the time, I had no idea how to use the practice management system (PiMS) for inventory and before me, they had not really used it much at all. I did not have a grasp on when something needed to be ordered or even what to order. I remember just walking around the pharmacy, shaking bottles, wondering, “Is this low? Should I order this? What about this?” I had way more questions than I had answers.

Every time we ran out of something, it pained me inside. Every time I forgot to order something, I would be so embarrassed that I wasn't doing a better job. After this happened a few times, I thought to myself, “There has to be a better way. This just does not seem right and is not sustainable in the long term (or really even in the short term).”

So, I started learning everything that I possibly could. I poured over supply chain management books, went over every inch of the AVImark® software manual, read everything I could about veterinary and human hospital inventory management, and asked around at different local practices. I was on a mission to learn as much as I could. Slowly but surely, I started to get my feet under me.

I now had hope – hope that things could get better, that it would not always feel this way, and that change was possible. A lot of trial and error, time, and constant brainstorming went into trying to find what worked. Before starting this process, I did not realize what was possible; I just knew there had to be a better way. Looking back, I put so much time, energy, and effort into setting up inventory systems and fixing the PiMS that I could have written this book years ago. After years of helping other clinics implement what I've learned, finally, this book is here.

The emotional highs and lows of the process of learning and fixing inventory for that practice were really the catalysts for where I am today. Not only did I realize how much I enjoyed managing inventory and more of the operational aspects of a veterinary practice, but I also realized how few resources are out there on inventory management. When I made the transition from working in a practice to inventory consulting and training, I had one main goal. I thought to myself, even if one person feels like someone is in their corner and does not have to struggle alone, I've accomplished what I set out to do.

As I've shared my story over the years, I've come to realize just how common an experience it is. Often, the only training for inventory management is, “When you shake a bottle and it feels low, order it.” This method of inventory management is passed down from generation to generation because “this is how it has always been done'” feels safer than the risk of implementing new systems that are easier and less time‐consuming. Managing inventory does not need to be so stressful. You can enjoy this work by finding the right methods for you and your practice.

It can be scary to lean into challenging conversations with your care and leadership teams. It takes bravery to say “Wait, this is not right” or “We could be doing better,” especially if something is the way it's always been done. But you are the person who is uniquely skilled to help pave a profitable, practical, and more peaceful way forward for the practice.

I remember the first time I did a complete, practice‐wide inventory count at the end of the year. The practice had opened over eight years earlier and nothing had ever been counted. I embarked on this count all by myself. It took me weeks. I am so grateful for that process because of what I learned from it. I got to see the belly of the beast, as they say. But it took me HOURS of counting, fixing, adjusting, and changing quantities, codes, and item setups. There were so many inventory codes to update and change. So many items where the on‐hand quantity needed to be adjusted by thousands or even tens of thousands. But, every year after that, it got exponentially easier. What took me over three weeks the first year took about two days the next.

I think that's a common story in a veterinary practice. Inventory can be a bit like an overgrown garden. There are weeds everywhere and you are not really sure what's growing, what's thriving, and what is decomposing. Pulling the weeds, cutting through the overgrowth, and removing unnecessary plants and invasive species takes a lot of time and effort. But once you do, your garden begins to thrive and healthy plants shoot up. It can be easily maintained with a small pair of pruning scissors and a pair of gloves (plus some extra weeding time during spring). The garden, or what we'll begin to see as our coral reef ecosystem, is similar to our inventory; it might take some time and effort to fix and adjust all the outdated and old information but once you put that work in, your new inventory systems are vibrant flowers and bountiful vegetables.

I find it helpful to think about inventory and practice operations like an ecosystem. All the systems or pieces work together to form a symphony of structure that allows your patients to have everything they need and your practice to generate revenue so that patient care can continue for years to come.

Throughout this text, we'll be exploring inventory management and each of its parts. Within inventory management, there are important foundational principles and concepts that we'll explore together. But I invite you to consider how you might adjust or adapt these to your own unique practice. There is no one‐size‐fits‐all approach or solution to inventory. The good news is that there are some best practices and guidelines to follow, but there is wiggle room to be curious and creative about what works best for your practice. Harking back to the garden metaphor, how you tend to a vegetable garden in the Pacific Northwest is very different from how you'd tend to a flower garden in the Southeast. My best advice? Trust yourself. This book is a guidebook but it is also just a tool. You're the one pruning things that do not work and introducing systems that do. And if you want extra help, I'm here.

I've experienced that when inventory feels overwhelming and chaotic, people will grasp and cling to anything that seems like it will make it feel easier and help the practice not to run out of pharmaceuticals and supplies as frequently. But I think we can get caught up in the trap of seeking blanket advice and forget to be intentional about how and where we apply it. As a result, because we might not have fully considered our unique practice, the tactic or strategy does not stick and we realize it is not sustainable. We start running out again (or more often), and expired products start appearing (like someone got them wet after midnight). Maybe our PiMS goes wildly off track. Then we are right back where we started and we lose a bit of hope that our inventory can ever be better.

With each of the concepts and principles that you'll learn in the following chapters, you'll also find “Best Practice” questions to help you apply them to your unique...