With perpetual inventory, on-hand quantities are automatically updated to recognize dispensing and replenishment. A perpetual inventory system updates the inventory in real-time when inventory orders are delivered and inventory is dispensed. Here are several advantages of perpetual inventory for pharmacies of any size.
Allows for Accurate On-Hand Inventory
Changes to inventory levels are recorded in real-time such as when inventory is purchased and when it is sold, thus, on-hand positions are maintained with high precision. This continuous stocktaking provides you with the ability to run reports that can suggest possible theft, fraud, and diversion.
A perpetual system compares the inventory balance in the system with the year-end count and will allow you to investigate any discrepancies. Shrink is easy to spot when your PMS and shelf disagree.
Produces More Accurate Interim Data
A perpetual system keeps inventory balances correct and gives you a more accurate set of financial statements throughout the year – most importantly, your cost of goods sold which directly impacts your tax position. This is especially important when banks impose Current or Quick Ratio covenants to maintain credit lines or secure a loan. Moreover, financial conditions (inventory position, COGS, and profitability) are readily available.
Closer Management of Inventory Levels
Perpetual inventory management gives pharmacies improved visibility into their inventory investment levels and allows for sound purchasing decisions. Inventory levels are always accurate and the inventory turnover ratio is calculated accurately. This accuracy allows management to properly assess inventory efficiency.
Maintaining reorder points for thousands of drugs, while recognizing fluctuating demand, is nearly impossible without technology. Datarithm’s cloud-based software uses algorithms that forecast demand, recognize trends, and automatically resets reorder points accordingly.
Learn how moving to perpetual and/or automating your process can be transformative. Let Datarithm® do the work for you. Click here for more information and schedule your free demo today.