HSA Verse
Supplier and purchase order management
Why ordering decisions drive expiry losses
Expiry losses often begin at the purchase desk, long before a pack reaches the shelf. A generous discount, a salesperson’s suggestion or a fear of running out can lead to more stock than the pharmacy can sell before expiry. Good supplier and purchase order management in a pharmacy balances two risks: running out of a needed medicine and carrying too much of a slow one.
Use a written purchase order for every order
Even a small pharmacy benefits from a simple purchase order, whether it is on paper, in a spreadsheet or in software. It creates a record to check the delivery against. A useful purchase order includes:
- Purchase order number and date.
- Supplier name and contact.
- Product name, strength and pack size.
- Quantity ordered and agreed price per pack.
- Delivery location, such as the shop or godown, and the expected delivery date.
- Payment and credit terms.
- Minimum remaining shelf life you will accept at delivery.
- Name of the person who raised the order and the person who approved it.
How much to reorder
Two simple formulas help you move away from guesswork. Adjust them for seasonal demand, such as the weeks before Ramadan or during a flu or dengue season.
| Measure | Formula |
|---|---|
| Reorder point (packs) | Average daily sales × supplier lead time in days + safety stock |
| Suggested order quantity (packs) | (Average daily sales × days of cover wanted) + safety stock − stock on hand − stock already on order |
Example (illustrative): a pain-relief tablet sells an average of 18 packs a day. The supplier delivers in 3 days. You keep 2 days of safety stock and want 10 days of cover. The cost is PKR 85 per pack.
| Step | Calculation | Result |
|---|---|---|
| Safety stock | 18 × 2 days | 36 packs |
| Reorder point | (18 × 3 days) + 36 | 90 packs |
| Suggested order when stock reaches 90 | (18 × 10) + 36 − 90 − 0 | 126 packs |
| Order value | 126 × PKR 85 | PKR 10,710 |
Check every delivery against the order
Compare three things before accepting stock: your purchase order, the supplier’s invoice or delivery challan, and the goods physically in front of you.
| Check | What to verify | If something is wrong |
|---|---|---|
| Product and strength | Name, strength and pack size match the order | Do not receive it; contact the supplier |
| Quantity | Counted packs match the invoice | Record the actual quantity and note the difference |
| Batch and expiry | Printed batch and expiry are recorded for each batch | Follow your quality procedure; do not guess unreadable details |
| Remaining shelf life | Meets the minimum you agreed | Reject or agree a return, according to your terms |
| Condition | Packs are undamaged and stored correctly in transit, including cold-chain items where relevant | Quarantine and report to the supplier |
| Price | Price matches the agreed price | Resolve before payment |
Compare suppliers on more than price
Buy from suppliers who hold the licences required for their role in the supply chain. Confirm what applies with the relevant authority. Beyond that, compare suppliers on factors that affect your losses.
| Factor | Why it matters | Question to ask |
|---|---|---|
| Price per pack | Affects margin, but only if the stock sells | Is the price agreed in writing? |
| Remaining shelf life | Short-dated stock raises expiry risk | What is the minimum remaining shelf life at delivery? |
| Return and credit terms | Decides how much of a near-expiry loss you can recover | Will you accept near-expiry or damaged stock back, and within how many days? |
| Credit days | Affects cash flow | How many days of credit are offered? |
| Delivery reliability | Late deliveries lead to stock-outs and panic buying | How long do deliveries take, and how often are they late? |
| Accurate documents | Wrong invoices cause disputes | Do invoices show batch and expiry? |
| Recall support | Speeds up your response when a batch is recalled | Who do we contact, and how quickly? |
Example: when a bulk discount costs more than it saves
A supplier offers an 8% discount if you buy 600 packs of a product that costs PKR 500 per pack. The discount saves 8% of PKR 300,000, which is PKR 24,000. But the pharmacy sells only 40 packs a month, and the batch has 8 months of shelf life left. In 8 months it will sell about 320 packs. The remaining 280 packs, worth roughly 280 × PKR 500 = PKR 140,000 at cost, are likely to expire. The discount that looked like a saving of PKR 24,000 would lead to a much larger loss. Always compare the quantity you would buy with the sales you can realistically expect before expiry.
Track supplier returns and credit notes
- Record the batch, quantity and reason for every return to a supplier.
- Note the return deadline in the supplier’s terms and set a reminder before it.
- Keep a list of credit notes that are promised but not yet received.
- Review the list monthly and follow up. In the example in section 10, the PKR 5,250 credit note is real money only once it is received.
What to confirm with Dukanverse
Purchase orders and supplier management are part of the Dukanverse Professional plan. When stock is received, the lot number and expiry date are recorded for each batch.
Frequently asked questions
How much stock should a pharmacy order?
Use sales history, supplier lead time and a safety stock level rather than guesswork, and adjust for seasonal demand. Section 11 gives a simple reorder formula with a PKR example.