Best Practices for Managing Dental Clinic Inventory

Dental practices require more than just technical know-how in the cutthroat healthcare scenario of today’s market. To traverse a complex business landscape, they require strategic insights, tools, and one such practice is effective dental inventory management.

A dental clinic spends about one-third of its annual budget on inventory! However, many dentists don't think about inventory management because purchasing supplies is frequently an unstructured and occasionally unorganized procedure 1.

The expenses of poor inventory management, pressure on cash flow and profitability are often invisible to dental clinics.  Dental clinics must implement lean inventory management best practices to increase profitability, as the supply costs rise and profit margins narrow.

But, what is inventory management exactly, and why is it important?

A systematic method of acquiring, receiving, storing, and recording the usage of inventory or stock is known as inventory management.

Good stock management for your dental clinic will help you:

• Optimize dental orders and stocks 
• Improve financial management
• Enhance dental practice and productivity
• Reduce wastage and loss of material
• Keep up with regular and new trending market products
• Supports compliance with regulatory standards

Importance Of Dental Clinic Inventory Management

A well-established and effective system for maintaining dental supplies is crucial for a successful dental practice.  You can see the amount of products you have on hand and how much you consume by conducting regular stock audits. By using audits, you may make well-informed judgments about how much stock to order and prevent product shortages at critical times.

An effective inventory management plan allows you to know how much product you need and avoid over-ordering. When it comes time to place your order, your plan will assist you in selecting the vendors who offer you the best prices. To make sure you don't overpay and can buy with confidence, compare all related prices, including delivery. The cost savings from ordering the right quantity of supplies and avoiding extra expenses can save thousands of rupees annually.

How To Optimize Your Current Dental Inventory?

It is important to evaluate existing dental stocks available in your practice before implementing any new inventory management strategies. This is the first step to establishing a baseline foundation for optimizing a smooth inventory operation.

Use the following steps to evaluate the present dental stock in your clinic:

Apart from that, your workstation and normal routine will determine how you arrange your supplies. You should be able to swiftly and precisely monitor inventory levels with your system. 

Here are some tips and guidelines for improving dental inventory management:

1. Identify current stock issues
   

   Create a checklist with the answers to these questions after carefully inspecting the dental supplies that are already on hand. 

   • What specific items do you typically run out of, and how often?
   • What is the amount of any recently expired product?
   • Have any orders arrived over the deadline you were expecting?
   • Even for the treatments you don't often conduct, do you know where all the materials are kept?
     
     
2. Create a monthly and yearly stock list
   

   A properly designed dental office inventory checklist includes information about suppliers to aid in ordering as well as the current and maximum item quantities for your practice. 

   You can also make useful notes about pricing, expiration dates, particular storage requirements, and other things, depending on your needs.
   
   To make a list of the supplies for your dental office:

   • Put all of the supplies you now use in your practice, including dentistry and general office supplies, in writing.
   • Make a note of each item's location so that everyone on staff can find it easily when needed.
   • Calculate how much of each item you'll need each month. You will use these numbers as a guide when placing orders to determine the best time and quantity to order.
   • Categorize the dental inventory as per the need and shelf life 2:
     
     
     1. ABC (Always, Better, Control): ABC analysis is a method of classifying items according to their relative importance.
     2. VED (Vital, Essential, Desirable): VED analysis is a method of classifying items based on critical values and shortage cost of the item.
     3.  FSN (Fast-Moving, Slow-moving, Non-moving): FSN analysis is a method of classifying items based on how quickly they are used, and how long they stay in storage.
     4. SDE (Scarce, Difficult, Easy): SDE analysis is a method of classifying items based on their availability and procurement complexity. 
     5. HML (High, Medium, Low):  HML analysis is a method of classifying items based on their unit price or annual consumption value.
     6. SOS (Season-Off-Season): SOS analysis is a method of classifying items based on seasonal trends and patterns to optimize supply operations and maximize profits.
        ABC and VED are the most commonly used inventory control techniques in dental practice as the majority of dental supplies fall under these matrices.
3. Organize your stockroom and supply station
   

   An orderly structure makes it simple to locate supplies when you need them, guarantees proper storage for sanitization, and lowers the possibility of accidents occurring in the stockroom. You may carry out stock audits with efficiency and keep track of products that are taken or received in an orderly stockroom. Here are some pointers for setting up the stockroom in your dental office:

   • Organize your resources so they are immediately accessible: Keep your most utilized items in a location where you can simply get them when needed. 
   
   
   • First-in, first-out (FIFO) is an inventory method in which products are used according to their expiration or receipt dates. Even though it's a good practice for any dental product, FIFO is crucial for reducing wastage of perishable items, such as dental restorations that have early expiration dates. A physical system where the newest things (or items with the latest expiration dates) are inserted at the back and the oldest are kept in the front is the simplest approach to implementing FIFO.
   
   
4. Reordering your dental supplies
   

   Learning how to balance when to reorder dental supplies could take some time. If you order too little, you risk running out of product at important times, and if you order too much, you risk reducing cash flow and wasting money on outdated supplies.
   
   While reordering the dental supplies consider the following points :

   
   
   • Order lead time: The approximate amount of time, expressed in days, that elapses between placing an order and having it fulfilled is called lead time. The time it takes for each shipment to get to your workplace could vary. The vendor should ideally state the lead time on their website or in their quotations. It's crucial to remember that this is normally an average lead time and may change based on a variety of circumstances. You should confirm the exact delivery dates when you place your order, so be sure to monitor these to make sure your things will arrive before you run out.  
   
   
   • Safety stock: Ordering a little bit of extra inventory will help shield you from unexpected spikes in demand or delayed delivery. By keeping a buffer of items on hand in case of an emergency, safety stock protects the continuity of your practice. The lead times and consumption quantities could differ depending on the product, safety stock needs to be determined individually for each item.
   
   
   
   • Reorder point (ROP): The quantity of inventory needed to initiate a replenishment order is known as ROP. When you establish a reorder point, whenever your inventory level drops below that point, an order is automatically placed. Average lead times, or how long it typically takes for products to arrive after an order is placed, and the quantity you anticipate using in that same time frame should be the basis for determining the reorder point.
   
   
   • Reorder quantity (ROQ): The amount you will order when you get to the reorder point is known as the reorder quantity. You may ensure that you have enough inventory on hand to prevent running out before your next order arrives by pre-establishing a reorder point and reorder amount. However, you should avoid having too much on hand that would negatively impact your cash flow and result in needless additional expenses.
   
   
   • Physical Inventory Count: The procedure of physically confirming the quantities kept in inventory is known as a physical inventory count. Each item is physically tallied and documented during a physical count, or using a barcode scanner. The counts and records are then updated in the system to detect inconsistencies and guarantee that correct stock levels are maintained.
     
     Current Technology And Inventory Management Software
   
   

   You can handle supplies on your own, but inventory management software makes it easier and frees up more time for you to spend with your patients. Inventory management software streamlines the process with its modern user interface and automated operations. 

   This is how your dental practice can benefit from inventory management software:

   • Manage and track dental inventory
   • Send stock quotations to dealers and suppliers
   • Automatic stock reordering 
   • Cross-compare invoices to purchase orders
   • Systematized billing and stocking 
   • Offer barcode scanning to improve data accuracy and efficiencies, including support for unique device identifier (UDI) barcodes.
   • Detailed reporting and real-time tracking
    

These are a few of the best dental clinic inventory management systems available the market today 3:

Training Your Staff On Inventory Management Best Practices

Dental clinic management is not taught to students in the majority of Indian dental schools. Understanding and putting into action best practices for dental clinic inventory, dental supplies, and dental resources is essential for a prospective dentist to practice dentistry successfully.

The first step is to educate yourself about inventory management, stock audits, and inventory management tools. The second is to ensure that your clinical staff and team are fully aware of tracking, ordering, and managing supplies via the system.

Key points to emphasize during staff training:

• Always double-check the quantity when receiving stock.
• Update the system as soon as the products are refilled.
• Verify that the personnel is accurately and efficiently entering data.
• Give your staff members specific roles and responsibilities.
• Appoint different staff members to conduct the physical stock verification and system entry.
• Conducting training sessions on emerging technology and market trends further strengthens the team's skills.

Conclusion

Every dental clinic must perform an annual SWOT analysis for improved dental inventory management. Based on the information gathered, list the strengths, weaknesses, opportunities, and threats. Analyse the listed items, consider their impact on the dental practice, and prioritize them based on their significance 4. Any dental practice's ability to run efficiently depends on its ability to handle dental inventories. By keeping up with emerging trends and technological advancements, we can guarantee that inventory management is constantly at the forefront. Well-managed inventories lead to both a healthier bottom line and better patient care . Thus, take control, never stop studying, and see your practice grow!

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Sources:

1. Gupta, N. (2016) ‘Inventory analysis in a private dental  hospital in Bangalore, India’, J Clin of Diagn Res. doi:10.7860/jcdr/2016/23273.8898. 
2. Gupta R, Gupta KK, Jain BR, Garg RK. ABC and VED Analysis in Medical Stores Inventory Control. Med J Armed Forces India. 2007;63(4):325-327. doi:10.1016/S0377-1237(07)80006-2.
3. Best dental software with inventory management 2024 | getapp. Available at: https://www.getapp.com/healthcare-pharmaceuticals-software/dental/f/inventory-management/ (Accessed: 03 August 2024). 
4. SWOT analysis for a dental practice: A comprehensive guide .The Dental Marketer. Available at: https://thedentalmarketer.site/articles/swot-analysis-for-a-dental-practice (Accessed: 03 August 2024).