Inventory and rental assets are where a DME supplier's capital sits. Capital equipment, rental fleets, and consumable resupply each tie up cash differently, and the owner's job is to keep that capital producing revenue — turning consumables fast, keeping rental assets out on rent, and converting capped rentals to owned equipment — without stocking out on the items patients need now. This dashboard balances the capital tied up in inventory against the revenue it produces.
What this report answers
Is our inventory and rental capital working hard enough, and where is it idle or short? The inventory-and-turns page shows inventory turns, asset utilization rate, stockout incidents, and active rental revenue, with turns by product category, units on rent vs. owned by category, and stockout counts by SKU class (capital equipment, rental asset, consumable/resupply, accessory). The rental-vs-purchase page shows rental revenue mix and capped-rental conversion, with rental vs. purchase revenue and conversion rate by category, plus a category table tying turns, utilization, mix, and conversion together.
The metrics that matter
Inventory turns (COGS ÷ average inventory value) tells you how fast stock moves — high for consumables/resupply, naturally lower for capital equipment. Asset utilization rate (units on rent ÷ units owned) is the rental-fleet efficiency number: idle owned assets are dead capital. Rental revenue mix shows how much of equipment revenue is recurring rental versus one-time purchase. Capped rental conversion captures the Medicare capped-rental lifecycle — rentals reaching title transfer — which materially affects revenue recognition. Stockout incidents flag where a shortage is costing fills, usually in fast-moving consumables.
Why the data is trapped
Inventory cost and on-hand quantities, rental-asset status, capped-rental clocks, and revenue by line live across the inventory module, the rental/asset ledger, and billing inside Brightree, TeamDME, Fastrack, or Computers Unlimited's TIMS. Computing turns by category, joining owned-vs-on-rent counts to utilization, and tracking capped-rental conversion against the rental clock is multi-table modeling these platforms rarely surface together — so capital efficiency, the thing an owner most wants to manage, is the hardest thing to see.
How to read it
Read turns and utilization by category together: a category with low turns and low utilization is over-stocked or over-owned capital you can trim; frequent stockouts in a consumable class mean you're under-stocked and losing fills. The rental-vs-purchase mix shows how much recurring revenue your model carries, and capped-rental conversion tells you whether rentals are completing their lifecycle to title transfer. Use the category table to spot the line that's both low-turning and low-converting — that's where capital is least productive. This sample uses fully synthetic SKUs — no PHI.
Metrics it tracks
| Metric | What it means |
|---|---|
| Inventory Turns | Cost of goods sold over average inventory value — SUM(COGS) ÷ SUM(AvgInventoryValue). |
| Active Rental Revenue | Monthly revenue from active rental assets — SUM(MonthlyRentalRevenue). |
| Rental Revenue Mix Rate | Rental share of equipment revenue — SUM(RentalRevenue) ÷ (SUM(RentalRevenue) + SUM(PurchaseRevenue)). |
| Capped Rental Conversion Rate | Capped rentals reaching purchase/title transfer — SUM(ConvertedToPurchaseFlag) ÷ SUM(CappedRentalFlag). |
| Asset Utilization Rate | Owned units currently out on rent — SUM(UnitsOnRent) ÷ SUM(UnitsOwned). |
| Stockout Incidents | Count of SKUs that hit a stockout — rows where StockoutFlag = 1. |
Used by: Operations director; inventory/purchasing manager
Frequently asked questions
What is a good inventory turns number for DME?
Inventory turns is cost of goods sold over average inventory value, and the right level depends on the item — fast-moving consumables and resupply should turn many times a year, while capital equipment naturally turns slowly. The value is comparing turns across product categories to find where capital is over-stocked relative to how fast it moves.
What is capped rental conversion in DME?
Under Medicare's capped-rental rules, certain equipment is rented for a fixed number of months and then transfers to the patient (title transfer). Capped rental conversion is the share of capped rentals that reach that purchase/title-transfer point. It matters because it affects revenue recognition and signals whether rental assets are completing their full lifecycle.
Why track rental-vs-purchase revenue mix?
The rental share of equipment revenue tells you how much of the business is recurring versus one-time. Rentals smooth cash flow and tie up assets; purchases are lump-sum but free the capital. Tracking the mix by product category helps an owner balance predictable recurring revenue against the capital locked in a rental fleet.
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