Every week when I sit down to write this blog, I think about how independent pharmacies can win out against some pretty fierce competition. All the big box store pharmacies, grocery store pharmacies, and of course, the big bad wolf known as Wal-Mart. It’s a daunting task to say the least. So I can’t help but smile a little when I read articles like this one, about how Wal-Mart and other large corporations are struggling to find success in the pharmacy portions of their business.
Of course, independent pharmacies face the exact same obstacles that have given Wal-Mart and Target a run for their money. Their pain points may be the exact same as yours. Shrinking margins, less cash flow, and of course, more competition, aren’t minor irritations that will soon disappear. More likely they are hurdles you’ll have to continue to work through and overcome as your pharmacy grows.
Let’s take a closer look at these three major trouble spots and how independent pharmacy can find more success than the corporations using pharmacy point-of-sale.
1) Shrinking Margins – In some areas of your pharmacy, you may not be able to control the margin on products. And to an extent, local competition will dictate the pricing even on OTC products. But there are products where your margins will generally be higher. Private label OTC products are always a good pick. You can advertise the lower cost of private label products using compare and save and shelf labels printed from your pharmacy POS system, use the power of staff recommendations when customers need guidance, or promote them through your customer loyalty program by offering incentives for private label product purchase. You can also use these same strategies anywhere else in your pharmacy where margins are higher.
2) Cash Flow – For many independents, cash flow can be a concern at times. There are a few common trouble areas where you may be able to make things a little easier.
- If you offer house charge accounts, make sure you manage this through your pharmacy POS system. Timely handling of overdue balances, automated statement printing or emailing of statements, and other integrated features will help you collect funds owed faster and with less time spent.
- You can also use your POS system to track product sales. If a particular item isn’t selling, you’re losing potential sales. Check out this article on inventory holding costs for some tips on identifying poorly selling products and what to do when you find them.
- Some other great features for independent pharmacies include cash management and integrations with check verification services along with built in tracking for known bad check writers.
3) Competition – While you may get pretty adept at managing your margins and eventually be able to leverage pharmacy technology to leave any cash flow worries far behind, ongoing and increasing competition is probably a given. Offering services that your competitors can’t or won’t will always be the key to keeping your existing customers happy. Curbside delivery is a growing trend for independent pharmacy and a great way to stand out. One on one patient counseling using less traditional POS models is also gaining momentum.
While sometimes the odds against independents may seem insurmountable, the unique nature of every independent pharmacy provides an edge that the box stores just don’t have. If you can learn to utilize pharmacy POS and other technology as tools in your pharmacy business, you may find some of these common troubles to be not quite so troubling anymore.