Is owning a pharmacy profitable? It’s a tricky question and the answer is more complicated than you might think. Long story short? It depends.
Pharmacies fulfill an incredibly important role in our society, but we can’t forget that they are still businesses that need to be profitable in order to succeed.
Owning a pharmacy continues to be a profitable venture. With that said, there are a number of changing factors that might impact the profitability of any pharmacy.
In this article we are going to review 6 factors that you should consider when it comes to the profitability of a pharmacy.
1. The Market
The state of the market is one of the biggest factors influencing the profitability of any business – pharmacies included.
When discussing future profitability, it is always important to consider where the market is headed. Make sure you are keeping up with the trends and research about what is happening in the healthcare space.
2. Number of Prescriptions Filled
The number of prescriptions you and your team are able to secure will directly determine your ability to be profitable.
In addition to filling prescriptions, over the counter sales have become increasingly important. Whether it’s grocery, equipment, or vitamins, having a strategy to boost over the counter sales can help increase profitability.
3. On-Demand Expectations
We live in a society where on-demand services are expected from customers and even patients. From electronics to meals to car rides, people expect these goods and services to arrive to them as conveniently as possible around their schedule.
Consider on-demand services such as mail-ordering for your pharmacy to reach more patients effectively and provide a better patient experience.
4. Financial Management
Financial management is key to the profitability of any business, and pharmacy is no different. Smart budgeting is one of the sure-fire ways to ensure your pharmacy maintains profitability.
While it’s easier said than done, some of the key tips include:
– Leverage promotion around popular prescriptions or items tailored to your customer base.
– Introduce new services as streams of additional revenue
– Cut back on non-essential costs or identify strategies to reduce costs (collaborations or partnerships, cost-sharing, etc.)
None of these will be new information to a pharmacy owner. The key is to ensure that you are spending the time to think critically and thoughtfully about how you can make improvements in these areas to increase your capacity to be profitable.
5. Your Business
Above all else, and more important than any other factor on this list – is you, the pharmacy owner.
Everything that we described above will be directly influenced by your passion for and commitment to your business. Profitability, especially in a highly competitive space, relies heavily on one’s entrepreneurial spirit.
Like any business owner, you have to be willing to put in the hard work, make sacrifices where necessary, and go above and beyond for your employees and your patients alike.
There will always be a level of risk when it comes to operating a business, and that’s true when operating an independent pharmacy. Again, here’s a quick rundown of the factors we think you should pay attention to when you ask yourself “is running a pharmacy profitable?”
- What is happening in the market?
- How many prescriptions are we able to fill?
- Are we budgeting effectively? Are we doing our best to control costs and boost revenues everywhere we can?
- What is the customer experience like at my pharmacy? What can I adjust to ensure the optimal experience for (and optimum value from) each and every patient?
- What do you need to be able to lead your pharmacy to success and profitability?
With answers to those questions in mind, you will be much better equipped to determine if your pharmacy is well-positioned for profitability.
6. Invest in Technology
As a pharmacist, your only opportunity to interact with your patients is at the pharmacy. But what about outside the pharmacy?
This is where investing in technology comes in. Consider patient management tools to communicate and follow up with their experience with their prescriptions.
Also, it can be an opportunity to send alerts and reminders about their refills. By creating frequent touch-points with patients, this puts your pharmacy at the forefront of their minds and improves the experience for patients, especially when they have questions or inquiries.
Patients will always appreciate you taking the time to support and educate them. With so many local pharmacies in proximity of your patients, invest in technology to improve patient loyalty, trust, and satisfaction.
Stand out and emphasize the care factor of your pharmacy. It may be a tough pill to swallow when it comes to the thought of spending money for tech, but think like an entrepreneur, you need to spend money in order to make more.