Financial reports show how a business has performed financially. For example a Profit & Loss statement will show how well the business did in a month or quarter financially. But it does not tell you what is causing the performance of the business, good or bad. Only combining the financials with reports from your pharmacy system can tell you this.
To have a comprehensive view a lot more information is needed such as revenue per prescription, margin per prescription, generic vs. brand mix, new vs. refill, payroll per employee type, top payers, top drugs, etc. All these numbers can impact revenue, margin, and ultimately profit. Understanding these will allow you to positively impact them for the success of your business.
The second reason you need more than financials is that from month to month pharmacy financials are not comparable. The pharmacy business is swayed dramatically by the number of business days in a month and the number of Mondays. More Mondays and more business days will create increased revenue or increased purchases or both. As such, if you compare August of one year to August of the next year they will not look the same. Analyzing metrics from your pharmacy system weekly will give you comparable data allowing you to proactively take any necessary actions.
At IRx Consulting we are Accounting experts and offer a comprehensive Pharmacy Accounting service with a suite of complimentary services including Data Dashboards, Payroll & Human Resources and Pharmacy Management consulting.
