GPO_Inventory PPT

GPO_Inventory PPT

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Unformatted text preview: hand A low turnover rate may indicate products are not being used at a rate relative to average inventory Inventory turnover rate is calculated by dividing the inventory cost into annual purchases Inventory Turnover Rate (2/2) Average ITR usually does not exceed 10 turns Inventory Turnover Rate = Annual purchases at cost Average on-hand inventory Example: Clinic purchases $500,000 per month $6,000,000 ($500,000 x 12) = 8 inventory turns per year $750,000 An increase from 8 to 9 turns will drop on-hand inventory to $666,666 resulting in a cash flow savings of $83,334 Inventory Management (1/4) Three Methods Visual System Periodic Perpetual Inventory Management (2/4) Visual System Visual inspection of what is on the shelf Inexpensive, simple, no training Imprecise Focus is on out of stock items rather than excess inventory Monetary amount not calculated Provides no data Inventory Management (3/4) Periodic System Stock on hand is counted at periodic intervals and compared to the desired inventory levels Items that fall below par level are then orders Evaluation of inventory is scheduled and more precise than the visual system Inventory Management (4/4) Perpetual system Most elaborate and accurate method of inventory control Inventory is monitored at all times Number of units in stock at any time Provides the best control in both units and dollars Most labor intensive and expensive Computer technology often employed Inventory Monitoring Tools (1/2) Computerized Inventory Control Pyxis, Lynx Mobile Inventory control systems and more Auto-ordering Par-level or re-order point functionality Reporting capabilities Real-time electronic billing interfaces Waste management Security Inventory Monitoring Tools (2/2) Computerized Inventory Control Not set and forget it Data entry required Requires maintenance on the part of the vendor and user Item selection J-code and billable unit verification Human error factor Interface costs Receiving Pharmaceuticals Chemotherapeutic agents are “hazardous materials” and should be handled as such PPE for staff unpacking and storing agents Cont...
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This note was uploaded on 01/24/2011 for the course BUS Mkt taught by Professor Tbd during the Spring '10 term at Montclair.

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