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Pharmacy

Sector Spotlight: Pharmacies

Find out what skills are best suited to running a drug store, and what to look out for when you’re buying an established pharmacy.

Community pharmacies across South Africa are expanding their services and diversifying their product range, including beauty and cosmetic items, creating additional revenue streams and increasing their customer’s average spend.

If you’re keen to break into the sector, qualifications are valuable but not essential so long as you employ a qualified, registered pharmacist. This article outlines the essential skills you need and the process of finding and buying an existing drug store business.

Facts and figures

  • The pharmaceutical sector is valued at R68 billion in retail sales
  • There are more than 160 pharmaceutical companies offering medicines and healthcare products to the public
  • Increasing access to affordable medication across South Africa is a big challenge
  • Growing the country’s manufacturing capacity also proves difficult
  • Recently there have been technological advances in the manufacturing of drugs
  • There are more than 275 pharmaceutical companies licensed by the Department of Health and the Medical Controls Council across South Africa

Overview

South Africa’s public health sector is under pressure to achieve more, despite having fewer resources than initially proposed due to the country’s weak economic growth. There is a high demand for pharmacists in the public sector, with an additional 12,000 posts that need filling.

Pharmacy

Keeping up with manufacturing demands and producing affordable medication is also putting a strain on the industry. However, many drug store owners are expanding their product lines and in-store services to attract more customers and increase their store’s turnover figures.

Essential skills

Qualifications are essential if you plan to advise your customers about medication; to get a BPharm degree you need to enrol in a four-year university course. Alternatively, you can employ a qualified, registered pharmacist. If this is the route you take, you will need to establish a good, strong dynamic with them.

This is a customer-facing business so your service skills should be excellent and in the first few years, you should expect to be very hands-on. You need to build up your store’s reputation and establish yourself within the community; no one will do this better than you can, as the owner.

Pharmacy

Recruiting, training and managing staff is an important skill, don’t fall in the trap of trying to do

everything yourself. Assess your employee’s different strengths when assigning tasks and review their work. Once you have a reliable team, you need to work hard to keep it.

Forming good relationships with your pharma suppliers is also important; have a backup supplier in place to ensure you have a continuous supply of the product. You should meet with drug representatives in person to form a more personable working relationship.

Buying an existing business

A pharmacy should have various revenue streams in addition to providing prescriptions. If you’re interested in buying a drug store, find out what extra services are on offer, such as screening, family planning or emergency care for minor ailments, and how popular they are.

A key decision you need to make is whether you prefer to operate as an independent or a franchise. What are your main goals? Evaluate your strengths and weaknesses to help you determine which direction to go. Buying a franchise will allow you to operate within a framework and with training and support from the franchisor.

Pharmacy

If you are worried about owning a business or you are new to the sector, this might be a valuable option for you. On the other hand, some people prefer to run a business without the strict structure that comes with a franchisor. Buying a franchise can also come with extra costs that you need to be aware of before making a final decision.

If you plan to keep the drug store running while the sale is going through, it’s a good idea to keep the existing team and operational procedures in place. Spend time shadowing the current owner; you can assess each employee’s performance once you’re running the store.

There are certain aspects of the business that you simply can’t change, the main one being location. Ideally, the pharmacy should have good footfall and high street presence; however, many of your customers will travel to you if you build up a good reputation in the community.



Krystena Griffin

About the author

Krystena Griffin writes for all titles in the Dynamis stable including BusinessesForSale.com, FranchiseSales.com and PropertySales.com as well as other industry publications.

@Be_TheBoss

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