Lessons on Pharmacy Cash Flow Success

During the RMS August CLIMB Broadcast we were joined by Cortland Data Partner Craig Robinson and pharmacist/ pharmacy owner Joe Daugherty.

Joe is the owner of Stanley’s Pharmacy, in Marshfield, MO. He made the decision to abandon the more traditional rebate pricing model in favor of a transparent pricing model. This concept aims to remove the mystery from pricing and helps to keep more working capital in your bank account as opposed to someone else’s.

Joe and Craig shared insights on what it means to fully adopt and succeed with a transparent pricing model. And some of the real-world benefits that pharmacy owners can experience through pricing model changes.

While this topic isn’t directly related to your pharmacy point-of-sale system, we still think it’s incredibly important. We’re so excited about the wisdom that Joe and Craig had to offer and wanted to share some of our favorite takeaways from the panel discussion.  There’s something to learn for every pharmacy, so keep reading even if you aren’t looking to adopt a different pricing model right now.

(Or you can skip the reading and watch the video here!)

Saving time, and streamlining processes has a big impact

As point-of-sale providers, RMS has long been helping customers streamline front end inventory management and OTC product ordering. Giving our pharmacy customers back valuable time, and improving overall efficiency is incredibly important. Streamlining prescription ordering and simplifying processes on the other side of the pharmacy is where Craig’s expertise comes in. Joe shared that before working with Craig and RxCherryPick he had to place multiple orders, spending extra time to verify pricing every day, just to try to get the best deal. Today, Joe places a single order, freeing up time and reducing stress.

No matter what programs you use in your pharmacy, it’s always worth looking at the processes that don’t make sense or seem to take too long. When you can find a way to remove work from your plate, it’s almost always worthwhile.

Change takes time. Or does it?

There’s nothing like financial stress. When you’re going through it, you just want it to be over as quickly as possible. But there’s not always an easy way out. We asked Joe and Craig just how fast a pharmacy can see change when adopting a different pricing strategy. The answer? Within 6-8 weeks, Joe said he had cash flow.  It was up front, transparent. He knew what he was paying and getting a much better deal.

The takeaway for everyone here? Find the low hanging fruit. Look for ways you can see quick results and experience success. Those quick wins, even if they are small, help you build momentum and open the door to bigger things.

Better Dating makes a difference.

Waiting 6-8 weeks for an insurance check to come when you have to pay your drug bill in 3 days is one of the reasons cash flow problems exist for pharmacies. Joe cited 30-45 days on dating when working with RxCherryPick which makes a huge difference for pharmacies. Especially when you compare it to the most common 7-14 day terms most pharmacies experience.

If you can’t improve your dating, look at financial management strategies that might help you navigate when cash flow is tight. Here’s a great article with some helpful tips.

Stop working in the business and start working on the business

If you’re dialing for dollars, or not sleeping because you’re worried about checks and deposits, there isn’t much room left for doing the things that can really take your pharmacy business to the next level.

Joe shared with us that as a result of improved cash flow, he’s been able to get creative in his pharmacy business and make some real changes happen. Including working with one of our other CLIMB speakers, Chirs Cornelison and his company SolutionsRx. After the DiversifyRx Conference in July of 2021, Joe came back and made the decision to start recommending supplements for drug induced Nutrient Depletion. In a single week, he doubled all of July’s OTC product sales.

Having the time, the focus and the cash flow to commit to growing alternative revenue streams is a game changer for any pharmacy.

P.S.. We can make this even easier for you with our NutriButler program which integrates drug induced nutrient depletion recommendations into your point-of-sale.

Improve your mental health and employee satisfaction for decreased turnover.

Have you ever taken a bad day or frustration out on a team member or employee? We’ve probably all done it. When we’re stressed, we lash out at the people closest to us.  Escaping this cycle helps you maintain employees which is an incredibly important part of the customer experience.  (Plus, it’s time consuming and expensive to train new employees, so if you have a great team, keep it that way!)

Outside of the improved culture that comes from less financial stress, you can also put better cash flow to good use for your pharmacy team. Joe gives bonuses, hosts family bbq’s and takes his staff out to be together as a team and build stronger relationships.

This is all so important because when you have loyal employees that stay and grow with your pharmacy, you have the opportunity to create a team that’s capable of running without you. Keeping your business alive and your community healthy, no matter what the situation.  Whether you’re unexpectedly out, or vacationing with your family.

Read more about employee wellness and building great teams in this article.

 

Ready to keep learning about Cash Flow?

We have a great series on the subject covering both pricing and financial management strategies. Check it out here!