It's no secret that hospitals overspend on medical supplies and inventory management labor. Yet, there's a common misconception that it's inefficient supply chain operations at the root of the problem.
In truth, it's inefficient inventory control strategies that increase costs and decrease efficiency in the supply room.
Here's the good news: making only a few tweaks to your hospital's supply room inventory management game plan can eliminate these issues. You'll free up money and time that you can reinvest into caring for patients.
Sound too good to be true? Then keep reading for the top five ways to improve healthcare inventory management at your hospital in 2021.
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Track Key Inventory Metrics
Every hospital knows that a lean supply room is the best way to cut inventory costs. But how do you keep your inventory supply lean? First, you need to start measuring inventory key performance indicators (KPIs).
The most important inventory KPIs are total inventory turnover per year and monthly inventory turnover.
You can calculate total inventory turnover using the cost of supplies used per year divided by the average number of supplies on hand at any given time. This KPI will show you how many times you turn over inventory per year.
Here's how you calculate monthly inventory turnover: multiply inventory used per month by 12. Then, divide the quotient by the average stock on hand at the end of each month.
If your hospital has an annual inventory turnover of four or less, you could be losing money and wasting space.
In general, the average-sized hospital turns over inventory 2–8 times per year. So, try to keep your annual inventory turnover within the range of 4–8 times per year.
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Collect Supply Chain Data
Data-driven decisions are transforming the healthcare industry. And hospital supply chains are no exception.
Supply chain analytics can help generate information your hospital can use for a leaner equipment management strategy. Indeed, 29% of organizations using supply chain analytics say they've seen a 29% return on investment.
Data is critical for identifying supply chain risks, reducing shortages and delays, and cutting costs. And supply chain analytics can help improve planning accuracy. That way, your hospital isn't wasting supply room space.
Best of all, data analytics combined with value-based care models allow your hospital to link supplies needed to patient outcomes.
There are three types of analytics your hospital can utilize:
- Descriptive
- Predictive
- Prescriptive
Descriptive analytics give you an honest look at what's going on at every step of the supply chain. Predictive analytics tells you what supply chain problems you can expect at any given time. And prescriptive analytics enable future-oriented strategies for solving inventory problems.
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Utilize Asset Tags
Ever wished your hospital could automatically track every piece of equipment in your supply closet? Then you need asset tags.
Asset tags are labels used for each piece of equipment in your supply room. Labels come with a barcode featuring unique ID numbers staff can scan when checking items in and out.
The benefits of using asset tags include saving money and improving staff efficiency.
With asset tags, hospitals can track equipment as it moves to different floors and departments. This virtually eliminates the risk of theft and misplacing equipment.
Plus, asset tags will speed up equipment audits. You can even use data from asset tags to analyze lifecycles of critical and expensive equipment.
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Streamline Inventory Management Tasks
When polled, clinicians say they spend 20%–30% of their shift working on inventory-related tasks. But when you automate and streamline your inventory management process, your clinicians can reclaim this time to focus on patients.
The first step to streamlining inventory management is to ensure every staff member knows their role. Make it clear what's expected of your employees, including what their responsibilities are when it comes to the supply room.
Next, you've got to start with a clean slate. Hold a 5S event to organize the supply room. This is also a good time to deploy asset tags if your hospital isn't using them already.
Keep frequently used equipment on the front shelves at eye level. Also, try the first-in-first-out method, placing expiring products in front of newer supplies to reduce waste.
Once you've finished these tasks, your hospital can deploy systems to automate supply management. We're telling you more about automating inventory with Kanban management solutions next.
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Invest in a Supply Room Inventory Management System
By now, you may be wondering: how can my hospital implement the above tips for inventory management? The healthcare IT industry has come up with some amazing inventory management control tools, including Kanban.
The Kanban inventory management solution is a visual replenishment system guaranteed to:
- Improve supply chain operations
- Reduce inventory turnover costs
- Increase space in your supply room
At BlueBin, our inventory management bins come with asset tags. This makes the solution a breeze to learn and use. That way, your staff won't have to face a high learning curve and can start using the system immediately.Even better, these inventory systems provide performance and prescriptive analytics. Performance data insights will help decrease inventory-related expenses. And prescriptive analytics will help your hospital continue to thrive in the long term.
Stop Wasting Money on Hospital Inventory!
Inventory management is a critical way to cut costs at your hospital. Tracking inventory KPIs, analyzing supply chain data, and utilizing asset tags can help.
In today's modern world, automating inventory management with a supply room system is the #1 tip for streamlining operations.
Are you ready to try BlueBin's kanban supply room inventory management system? Contact us today to see how our solutions can transform the way your hospital does business!
