---
title: 6 Key Metrics to Gauge Mid-Year Pharmacy Performance
description: Check-in time! Assess your pharmacy's mid-year progress and make informed plans for a strong 2024 finish using these 6 key metrics.
---

[The RMS Blog ](https://www.rm-solutions.com/blog)

# [6 Key Metrics to Gauge Mid-Year Pharmacy Performance](https://www.rm-solutions.com/blog/2024-milestone-check-in-6-halfway-metrics-for-pharmacies)

 Written by [Karen Deckard](https://www.rm-solutions.com/blog/author/karen-deckard) | Sat, Jun 29, 2024 @ 02:18 AM

Much like making a pitstop halfway through a long road trip to refuel and take stock of snack supplies, the mid-year mark is a crucial milestone for assessing your pharmacy's progress and planning for the road ahead. And with 2024 nearing its midpoint, now is the perfect time for a quick check-in.

Tracking performance over time plays a vital role in understanding the 'why' behind the result. Comparing multiple data sets across a set time period can help you pinpoint the specific internal or external factors impacting your bottom line - positively *or* negatively. This is how informed business decisions that fuel growth and drive success are made.

Want to secure a successful end to 2024 for your pharmacy? Here are 6 key metrics to guide your mid-year pitstop. 

### **Front-End Inventory Turns**

As the name alludes, inventory turns are the number of times you’re turning your inventory over during a given period of time. You’d usually look at this number annually, but seeing where your front-end turns stand mid-2024 vs. where they stood mid-2023 isn't a bad progress report - especially if you’re actively looking to increase turns by year's end.

> #### You should aim for somewhere around the 12 times/year mark for front-end inventory turns (well above the NCPA Digest reported average of 1.7 times/year).

### **Rx Inventory Turns**

This is another great pitstop metric. It's something you really want to understand annually, but never hurts to check in on every once in a while. If your Rx inventory turnover (measured as the cost of goods sold ÷ the inventory's value) is less than 7, you probably have some work to do.

> #### You should aim for somewhere around 12 for this metric, so you’re turning over your stock once/month and not carrying extra inventory that ties up cash flow.  

### **Revenue Growth Percentage**

Your revenue growth percentage is another metric that's important to evaluate annually, but still can offer some valuable insight during mid-year performance assessments. You can find this percentage by using the following formula:

(revenue from a certain period this year - revenue from the same period last year)   
÷ last year’s total revenue

> #### You should aim for a number somewhere in the 6% zone, but ultimately you want to be seeing at least some amount of growth and no shrinkage.  

### **Payroll Expense Ratio**

Next to your inventory, your biggest expense is probably payroll - and it’s a number you really want to keep good track of. You can determine your payroll expense ratio by using this formula:

(employee wages [*including your own wages as a pharmacist if you're paying yourself for that role*] + payroll taxes + employee benefits) ÷ annual revenue

> #### This number should be about 12-13% on average but can be hard to keep lean, so checking in mid-year (or even more often) can be helpful.  

### **Non-Rx Gross Profit Percentage**

It’s well established that growing your non-prescription revenue (i.e., revenue not dependent on a 3rd-party contract) is key to running a profitable pharmacy.

And yet, many pharmacy owners don’t have a good grasp on their non-Rx gross profit percentage, even though this number really should be **at least **20% of your total gross profit.

> #### Regularly measure what you’re bringing in from OTC sales, point of care testing, or other services to make sure that number is trending in the right direction.  

### **Gross Margin Return on Investment (GMROI)**

As point of sale providers (and huge fans of pharmacy profitability), we can’t really have a chat about metrics without talking about GMROI.

Calculated as gross profit ÷ total sales, GMROI measures the amount of profit generated as products sell. This is arguably the most important metric to utilize when conducting mid-year check-ins, as GMROI offers the best possible snapshot of your front-end performance.

> #### To keep your pharmacy on track, be sure to run regular GMROI reports using your POS system throughout the year.

Want more metrics that will help you evaluate your pharmacy? [Check out this previous CLIMB session all about the metrics that help you grade your pharmacy.](https://youtu.be/O8KpEOFnbwo)  

[View full post](https://www.rm-solutions.com/blog/2024-milestone-check-in-6-halfway-metrics-for-pharmacies)

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