You might have a stockroom full of incredible serums you swear by and sunscreens you stand behind. But do you know exactly how many boxes you have? Or when it's time to reorder Botox? Most importantly - do these numbers show up accurately in your financial reports?
The Reality of MedSpa Operations
We consistently see that MedSpa owners are incredible clinicians, expert marketers, and ambitious entrepreneurs. However, between managing appointments, staff, and wearing multiple other hats, many aren't properly accounting for or strategizing inventory purchases - a critical component for business success.
The Real Impact of Poor Inventory Management
Consider this real example: We recently worked with a MedSpa owner seeking a private equity partnership who reported the same inventory balance in 2023 as they had in 2020. That's simply not possible! This gap in reporting creates a serious problem with financial accuracy, affecting both growth potential and partnership opportunities.
Common Hurdles to Inventory Planning
Here's what typically prevents effective inventory management in MedSpas:
- Limited bandwidth for monthly inventory counts
- Relying on gut feeling instead of actual data
- Being swayed by persuasive vendor offers
- Focusing only on cash availability for purchases
- Missing price increase trends
- Lack of systematic tracking processes
- Extended payment terms masking true costs
- Insufficient use of practice management software
- Overlooking retail product accounting
The Problem with "Cash in Bank" Decision Making
Many owners simply ask: "Do I have enough cash to make this purchase?" While vendor volume discounts might seem attractive, this approach is problematic. Without tracking your average inventory cost per item, you might miss price increases and fail to adjust your service pricing accordingly.
Starting Your Inventory Management Journey
Begin today by:
- Exploring your practice management software's inventory tools
- Reviewing your retail product accounting methods
- Selecting your highest-volume item and documenting:
- Purchase dates
- Costs
- Unit quantities
- Calculating average costs per item
- Creating a baseline count of the current stock
Moving Forward
Whether you aim to remain competitive, prepare for a partnership, or something in between, proper inventory management is crucial. Start small, but start today. Your MedSpa's profitability - and your peace of mind - depend on it.
Need help implementing inventory management strategies or evaluating your MedSpa's business practices? Contact us to discuss your specific situation.
