Why batch tracking matters
Every strip you sell carries a batch and an expiry date. Tracking at batch level is what lets you sell the earliest-expiring stock first, trace a recalled batch to the customers who bought it and claim returns from distributors. Tracking only at item level hides the problem until stock expires on the shelf.
First-expiry-first-out (FEFO)
FEFO means selling the batch that expires first, not the one that arrived first. It needs two things: batch and expiry captured at purchase entry, and a billing screen that suggests the earliest-expiry batch with sufficient quantity.
- Enter expiry as month and year exactly as printed
- Keep batches physically sorted so the earliest expiry is at the front
- Allow a manual batch override, but record a reason
Set expiry thresholds
Decide how many days before expiry stock becomes a concern. Many pharmacies use 180 days as an early warning, 90 days as action and 30 days as final push. Distributors have their own rules on how close to expiry they accept returns, so check each supplier’s terms in writing.
| Window | Action |
|---|---|
| 180 days | Flag, stop reordering, shelve at front |
| 90 days | Return to distributor, promote or substitute |
| 30 days | Final return window if the supplier allows, otherwise prepare to write off |
| Expired | Segregate, mark not for sale, dispose as per rules |
These windows are examples. Set your own by drug category and supplier policy.
Return to distributors on time
Prepare an expiry return list monthly with item, batch, quantity, MRP and purchase rate. Confirm the supplier’s return acceptance window and credit method. Record the return in your purchase return or debit note so stock, accounts and GST stay aligned.
Reorder levels that make sense
A simple starting formula: reorder level = average daily sales x supplier lead time in days + safety stock. Review it quarterly. Slow movers should have a low maximum so you do not buy expiry risk.
Use ABC thinking: a few items drive most sales value and deserve tighter control, while a long tail of rarely sold items should be ordered on demand.
Storage conditions
Expiry is valid only if storage conditions are met. Keep cold-chain items such as insulin and some vaccines within the labelled temperature, log refrigerator temperatures and avoid heat and moisture for tablets and syrups.
Expired stock handling
Expired medicines must never be sold. Separate them immediately, label them, and dispose through the route your licence and local rules require. Record write-offs so your stock matches your books. See the GST guide for tax treatment.