A Chat with an IT Manager in Pharmacy Retail Sector
Click to listen to the Interview in Urdu
Pharmacy Retail sector: A Chat with an IT Manager at Fazal Din Pharma Plus
Muhammad Saleem Sheik serves as the IT manager at Fazal Din’s Pharma Plus and has been a part of the team since 1996.
Recently, we had a chat with him. During our meeting, we had a discussion regarding the pharmacy retail sector landscape in the midst and aftermath of COVID-19, as well as taxes, particular regulations related to pharmacy, and advice he had for new players in the industry.
This is what we learned from our conversation:
The COVID-19 pandemic has affected numerous businesses, but pharmacy businesses have thrived due to an increase in demand for medicines. Has this momentum been sustained?
That’s correct. While numerous businesses shut down during the COVID-19 pandemic, the pharmacy retail sector saw an increase in demand and consequently attracted more investment from investors. In our case, the demand for our franchises rose significantly, resulting in the opening of 4 to 5 franchises each month in several cities across Pakistan.
However, now that things are returning to normal, other industries are also showing potential. As a result, pharmacies have reverted to their usual business routine. Presently, we are opening 1-2 new franchises per month.
The COVID-19 pandemic was a challenging time for many. Did the demand for stress-relief medications rise during this period, and what is the current situation like?
I understand. It’s true that during the COVID-19 pandemic, many individuals turned to anxiety and stress medications to cope with the situation, which led to an uptick in demand for anti-anxiety drugs. At present, sales of these medications have returned to normal, with individuals who have prescriptions for such medicines continuing to take them as usual.
Given the dollar shortage and other issues, import restrictions have been implemented. How has this affected the import of life-saving drugs? Are there any shortages, and how are you managing the situation?
As you may be aware, even though medicines are produced in Pakistan, we still rely on imported raw materials. While there have been occasional shortages of raw materials, the situation has not been catastrophic, and we have been able to manage it.
Regarding life-saving drugs, there has always been a shortage of these drugs in comparison to the demand for them. However, the government takes special measures to ensure their availability, and the prices of these drugs are regulated, with little profit margin for such medications.
There is a substantial demand for alternative healthcare products such as supplements and homeopathic medicines. Are these products available at Fazal Din’s Pharma Plus stores?
We only carry Multivitamins and supplements that have been registered with DRAP in our stores.
Similarly, we have a limited selection of homeopathic medicines that are registered with DRAP and available at our stores, but not all homeopathic medicines are available.
In the recent mini-budget, there was a 1 percent increase in sales tax. How has this affected both retailers and consumers?
Yes, there has been a recent increase in sales tax, with the rate rising from 17 percent to 18 percent. However, this change has only affected retailers who were previously not in the tax net or did not file their taxes.
For those retailers who already pay withholding tax, the increase in tax is only 0.5 percent, and it can be adjusted at the time of filing tax returns. As a result, this change has minimal impact on retailers who are already complying with withholding tax requirements.
So, consumers have not experienced any price increases?
No. The burden of the increased tax rate falls solely on retailers who were not previously in the tax net. For instance, if a particular medicine was previously sold for 100 Rs, it is still sold for the same amount to consumers. The only impact is a reduction in the profit margins of retailers.
As per the laws and regulations, it is mandatory for pharmacies to have a pharmacist present. Are you adhering to this requirement?
According to the law, a pharmacy that operates 24/7 must have a pharmacist present at all times. At our pharmacy outlets, we have three shifts, each staffed by at least one pharmacist, and sometimes even two. We ensure strict compliance with this requirement, unlike some pharmacies that may incur fines from drug inspectors for non-compliance.
How important it is for a pharmacy to be computerized?
Attempting to manage a retail pharmacy without a computerized system can be extremely challenging. For us, operating as a multi-store business necessitates the use of a computerized system or automation to manage all aspects of our operations, including ordering, sales, inventory, and business analytics.
Although there is no legal requirement to use software for managing retail pharmacies, computerizing your business provides significant advantages in terms of convenience. Many successful pharmacies rely on retail software to manage their businesses effectively.
However, due to recent requirements from DRAP to integrate your pharmacy with FBR, computerization has become a necessary step. To comply with this integration, you must computerize your system.
What recommendations would you suggest for pharmacy businesses?
To operate a successful pharmacy business, it’s essential to comply with government regulations. If you run a 24/7 pharmacy, it’s important to ensure a licensed pharmacist is available at all times. Additionally, hiring well-trained staff is crucial to guarantee accurate prescription delivery. Untrained employees could make mistakes that can have severe consequences. Maintaining proper cleanliness and ensuring proper air conditioning is also critical to prevent any negligence at your branch.