Located in the greater Puget Sound area of Washington, Summit Veterinary Referral Center ranks among the five largest hospitals in Ethos Veterinary Health’s expansive network of veterinary specialty facilities in the U.S. With a dedicated team of 245 caregivers, Summit provides 24-hour emergency, critical care, and specialty services. The center works closely with primary care veterinarians, offering referral-based patient care, and attends to approximately 5,000 pets annually.
In pursuit of excellence, the hospital developed a multi-tiered strategy for business optimization. Norman Retes, the hospital director, reflects, “Initially, Summit faced operational challenges hindering our efficiency. We initiated a series of improvements, from marketing to skill set training, aimed at increasing access to care and streamlining internal processes to achieve performance stability.”
One pivotal initiative involved automating inventory management, enabling proactive control over ordering, expenditures, and supply management. The goal was to enhance financial outcomes through improved cost control — a longstanding endeavor that found fruition with Inventory Ally.
Reorder tags and gut feeling
Previously, the hospital employed a pull tag system, where each stock item was tagged with a reorder card indicating minimum and maximum levels. Each department within the hospital has an assigned inventory captain responsible for managing inventory. When an item reached its minimum, the card was put in a designated bin, and the facility supervisor would then place orders accordingly, usually daily.
Since Summit depended on these tags to trigger supply orders, their loss could cause shortages of essential items. For a hospital of its size, Summit couldn’t rely on manual processes and risk running out of necessary supplies.
In addition to the need for time-consuming manual counts, which occurred multiple times a day, the pull tag system led to inconsistent ordering practices. “In terms of quantity, orders were based on what could fit on the shelf or what staff thought they needed,” explains Philippe Harrington-Descoteaux, Client Service and Facilities Manager. “There wasn’t a clear rationale behind it; rather, decisions were made based on gut feelings about potential needs.”
Ultimately, the opportunity cost of not having a more efficient inventory system was significant. “We’ve been seeking for a viable solution for a decade, and then we found Inventory Ally,” he concludes.
“We’ve been seeking for a viable solution for a decade, and then we found Inventory Ally”
Amplifying operational capital
With Inventory Ally, Summit Veterinary Referral Center reduced inventory on hand by $100,000 in just three months. By optimizing turnover, the hospital achieved a healthy and consistent 9% cost of goods sold (COGS) following the rollout.
Norman highlights that in recent months, Summit has observed a surge in both sales and visits, while maintaining stable COGS. “This indicates that we are now ordering more efficiently and enjoying greater predictability with our inventory,” he concludes.
Smart resource allocation
A notable advantage of streamlining replenishment with Inventory Ally was the significant time savings for the team. “With Inventory Ally, we transitioned from ordering five days a week to just one day. We simply place orders based on the program’s recommendations derived from ordering trends and current inventory levels,” explains Philippe.
“It is a substantial improvement in how we allocate our labor resources. Previously, inventory management consumed up to 10 hours per week, whereas now it only takes two. With 12 inventory captains overseeing stock, Inventory Ally has freed up 120 hours per week that can be spent in the exam room. Now they can bring revenue into the hospital by seeing patients instead of shaking bottles all day long.”
“Previously, inventory management consumed up to 10 hours per week, whereas now it only takes two. With 12 inventory captains overseeing stock, Inventory Ally has freed up 120 hours per week that can be spent in the exam room.”
Data-driven markup
Summit is successfully leveraging Inventory Ally’s data-driven insights, which pinpoint specific opportunities for improvement and help mitigate potential financial losses. “By monitoring our weekly expenditures, we can promptly address pricing fluctuations,” explains Norman. “We closely analyze reports comparing current inventory costs to previous orders, which enables us to uphold a dynamic pricing strategy. With this valuable report, we have already identified dozens of instances where pricing has changed and avoided losses by adjusting accordingly.”
Best-in-class hospital
“Our PIMS lacked inventory management functionality, and though they’ve recently introduced it, we haven’t explored it yet because Inventory Ally already meets all our needs,” Norman says. “From a hospital leadership perspective, especially for those not well-versed in inventory management strategies, Inventory Ally removes the guesswork. Essentially, you input data, and it provides insights based on your order history, minimizing the need for extensive brain power. Once set up, it transitions into a semi-automated process, freeing up valuable time. I would strongly recommend it for leaders lacking a robust background in inventory management and cost of sales within their operations, as it essentially handles these tasks for you.”
“Inventory Ally removes the guesswork. Essentially, you input data, and it provides insights based on your order history, minimizing the need for extensive brain power. Once set up, it transitions into a semi-automated process, freeing up valuable time.”
As one of Ethos network’s largest facilities, Summit has fortified its top-tier operational efficiency status with Inventory Ally. “By putting inventory management on rails, we’ve attained financial stability and gained access to advanced reporting for ongoing management enhancements,” Norman concludes.
