Managing Stock Expiry in Your Lab

Posted by: Fiona - Product Lifecycle Manager at Amici

Is your Inventory Management System Out-of-Date?

One of the biggest problems Inventory Managers have is the management of stock expiry. Often, missing or expired stock is not identified until the annual stock take and can amount to tens of thousands in financial losses. These losses will have to be written off, and expired stock disposed of appropriately. Moreover, poor visibility of stock expiration can lead to project delays or even production grinding to a halt. In some cases, expired R&D stock is not spotted in time, and products with reduced potency or even stability may be used in error.

From Drug Discovery to GMP Manufacturing, the sheer variety and pace of products ordered can exacerbate the challenge. If these issues sound familiar, it might be time to review whether your inventory systems are still optimal for your business.

Modern perpetual Inventory Systems, showing live inventory information, have major benefits over spreadsheets or paper-based systems. Some of these software solutions allow the user to view and sort by batch, expiry date and more.

Whether having a critical evaluation of your own Inventory Management System or evaluating options for inventory software, we recommend watching out for the following to help make expired stock a thing of the past.

1. Set and Review Reorder Triggers

It is important to review re-order triggers to ensure that you have enough stock on hand without overstocking the product. Holding too much stock ties up cash unnecessarily, takes up valuable space and can lead to financial loss where products expire before they are needed. It’s also important to take account of the footprint, storage requirements and shelf life of the product when setting Minimum Stock Levels and Economic Order Quantities (EOQ).

Review your inventory throughput and forecasts regularly in order to set a minimum stock level which meets your business requirements. Look for a system which allows you to edit and review minimum stock alongside current stock levels, product throughput, storage temperature and even value where possible.

2. Assign the Right Expiry Dates

In a GMP environment it is a requirement to describe how expiry dates are assigned, used and sometimes extended. This methodology is equally useful for R&D Inventory.

Managing Stock Expiry - Goods Received Number

Supplier expiry dates are normally used as a default and relate directly to the tested stability of the product under the recommended storage conditions. In some circumstances, separate internal expiry dates can be used, and may be shorter or longer than the supplier expiry date. Expiry dates may also vary according to when a product is opened or where it is stored.

Choose inventory software which will allow you to check in your stock by batch, or even make it mandatory to do so. Checking in by a unique GRN (Goods Receipt Number) is even better. The most flexible systems will allow you to add and edit both supplier and internal expiry dates, including date opened. GMP users should look for software which controls the use of expired products and make sure any changes to expiry date are fully audited.

3. Location, Location, Location!

A few simple precautions can really help tackle the problem of missing stock. Assign dedicated locations to each of your products and label these clearly. Make sure users are aware of any associated over-spill locations. Label each individual location with a basic number or use a barcode if your system is compatible. It is also good practice to rotate your stock, moving products with the latest expiry date to the back.

A good inventory system will allow you to link locations to each of your products and track where products have been moved to. Look for a system which will allow tiered locations, giving you the ability to filter at both a site or building level right down to an individual drawer or container within a freezer. Best-in-class systems will allow you to assign and view both product storage temperatures and location temperatures. Some systems may warn you if you try to assign a location with an incompatible temperature to the product.

4. FEFO – First Expired First Out

Managing Stock Expiry - FEFO - First Expired First Out

One of the most important features to look for in a best-in-breed Inventory system is dedicated FEFO functionality which will prompt users to pick items with the earliest expiry date. Modern perpetual inventory software is head and shoulders above static or paper-based systems when it comes to creating Pick Lists and reserving stock. Rather than picking random Lots from the shelf, a digital pick list can prompt the user to select stock with the earliest expiry date for the pick list – and show Inventory Managers exactly where this stock is located.

Best-in-class systems will include barcode options which make it really easy for Inventory Managers to scan picked stock to verify that the stock picked is the same as the one reserved.

5. Stock Count

One of the main advantages of inventory software is that you can see exactly what you have in stock. However, even the most powerful solutions succumb to human error and non-compliance. Consequently, inventory management solutions should always be supported by a stock-take in order to minimise losses from missing or expired stock.
We recommend ABC Cycle Counting in place of the more traditional Stock Take. Cycle Counting is a process used to audit inventory, where small portions of inventory are counted at a specific time. Cycle Counting has been shown to have many advantages over the traditional stocktake, not least of which is the improvement of inventory accuracy and early detection of problems. ABC cycle counting enables you to tailor the frequency of counting to your most important products.
Look for a system which enables Cycle Counting by category and reporting by count variance. The software should make it easy for you to spot problem areas and investigate stock discrepancies.

6. Reporting and dealing with Expiry

Managing Stock Expiry - Expired Products

It’s important to be able to use defined processes for managing expired stock, from quarantine to counting the cost of stock write-off. Inventory software should make it easy for you to view expiry dates for stock on hand. Watch out for systems which only allow stock to be deleted, rather than marking it as disposed.

The best systems should include reporting on stock usage and disposals all the way down to batch or even container level. Some systems may even link product value to each batch, allowing you to track financial losses from expired stock and to investigate accordingly.

GxP users should look for specialised functionality to ensure that expired products cannot be reserved or used, as well as providing electronic signatures and auditing to meet the needs of 21CFR11 and Annex 11

Amici: Up-to-Date with Expiry

At Amici, solutions are engineered to support our customers in managing stock expiry, and to ensure losses are kept to an absolute minimum.

Managing Stock Expiry

Image: Managing stock expiry with Amici. Click to see full-size.

Take Control of your Inventory

The Amici Inventory Solution is available now. Contact us at info@amiciprocurement.com or call +44 (0) 141 810 2580 to learn more.