Continuing the conversation on profitability, we've compiled a quick 3 ways you can increase your pharmacy's profits today!
The Evolution of Pharmacy
Pharmacy has evolved dramatically over the years, with the present market being the most competitive yet. How are successful pharmacies adapting?
The business of pharmacy, and the role a pharmacy plays in patient care, has evolved dramatically over the last 10 years. Even in the last 2 years we’ve seen huge shifts in the business models of some of the most successful pharmacies.
With these shifts, the role of pharmacy point-of-sale has shifted, too. (Or, at least, it should have.)
A good point-of-sale system in today's pharmacy market is as much a point-of-sale as it is a business management tool. It's helping you make your pharmacy as profitable and customer-centric as possible.
If your system isn't doing that for you, it might be time to consider a change. But, before taking that step, it's important to understand the impact of this evolution and how best to adapt your business.
One of the big catalysts for change in the pharmacy industry has been competition. Big box stores didn’t start to grow until the end of the 80’s and into the 90’s and early 2000’s. This happened with the influx of pharmaceutical drugs introduced into the market in the 1980s, setting a historical record. This rapid expansion of prescription drugs, combined with more people than ever taking them, lead to more players entering the market.
Today, this competition extends not only to the big box stores, but also to online pharmacies. And, of course, grocery stores carry virtually everything to do with OTC and most common health and beauty items. This represents major competition because while not everyone takes a prescription medication, everyone does go to the grocery store.
We also can’t talk about what’s changed without addressing the fact that regardless of how many prescriptions you sell, shrinking reimbursements and dwindling margins are going to hurt cash flow and impact your bottom line.
This has led to one of the most competitive pharmacy markets yet, and has put pressure on pharmacists to expand their business models.
What do I do?
Maybe the squeeze on your prescription business will be resolved; maybe it won’t. There's only so much you can do to change this. What you can do, though, is focus on the things you can change.
Now more than ever, your front end is valuable real estate. Every single product you carry counts. You need to make sure you are stocking products that are selling and offering a healthy return on investment.
You also have to continue to evolve and innovate. Not just in what you’re carrying, but in the services you offer. A clinical services model gives you an edge over online and big box competition and offers additional revenue streams. Clinical services are scalable and can be tailored to fit your business model and patient needs.
What role does pharmacy point-of-sale play now?
Some things about point-of-sale remain the same as they always have been. We're still using the same profit analysis and movement reports. While the data remains the same, it is arguably more important and valuable to you than ever. With the back end of your pharmacy spread thin, you need data to make the best business decisions. A good point-of-sale provides that data.
A newer job for pharmacy point-of-sale is to help streamline and enable services that you offer in your pharmacy. Like adding nutrient depletion notifications at the register, enabling home or curbside delivery, and helping you run and track the success of your customer loyalty program.
Point-of-sale should also help you develop and manage some sort of eCommerce. Whether connecting to your existing eCommerce store or just getting your online presence improved with Pointy from Google, your point-of-sale should be facilitating this in some way.
There’s no one-size-fits-all solution to growing your pharmacy business. Some will do it through making their pharmacy a destination with a unique front end, while some will grow through clinical services. Many will take on both and thrive.
The one constant is change. You have to change and adapt. And to pick partners that are ready to change and adapt right along side you.
How have you adapted your pharmacy business to best combat market changes? Let us know in the comments!