Managing pharmacy cash flow is one of the toughest parts of running an independent pharmacy. Between reimbursement delays, inventory costs, and changing billing cycles, cash can feel unpredictable. That’s why knowing how to identify and act on cash flow opportunities is key to staying financially stable.
In this first installment of our Buying Smarter series, IPC’s Nick Secrest, Vice President of Member Performance, and Senior Member Advisor Scott Wittnebel share three proven ways to improve cash flow and use the IPC Warehouse strategically.
1. Understand when money comes in
The first step to improving pharmacy cash flow is knowing when your reimbursements hit. Nick explains that many owners don’t track when funds arrive from PBMs or PSAOs. Once you understand your payment schedule, you can align your purchasing plan and control your outflow more effectively.
2. Use your billing cycle to your advantage
Scott highlights how timing orders with your billing cycle can have a major impact on cash flow. Placing orders through the IPC Warehouse near the end of your cycle can give you an extra week to 10 days of breathing room. This simple adjustment can help you stay liquid without cutting back on the product.
3. Treat inventory as cash
Your inventory represents your cash. When too much of it sits on the shelf, that’s money tied up in stock you can’t use elsewhere. Nick points out that the most efficient operators aim for around 15 inventory turns a year. If you’re below that, you might be carrying too much. Reducing excess inventory helps free up capital and minimize returns that delay reimbursement by weeks.
Scott also notes that integrating your pharmacy management system with EDI links to IPC Warehouse helps track profitability and purchasing trends. It allows you to see in real time how to save on brands and generics while managing your GCR. That means fewer manual checks, fewer vendor calls, and smarter decisions every day.
At the end of the day, these cash flow opportunities are about balance. The IPC Warehouse gives you flexibility to plan around your billing cycle, optimize your terms, and make every purchasing decision count.
