Retail Chain Pharmacy: Key Strategies for Successful Management
Retail Chain Pharmacy: Best Practices
In his previous video, Usman Ali talked about the mistakes that pharmacy retailers shouldn’t make. In this video, he focuses on chain pharmacy businesses. Based on his own experience in dealing with pharmacy chain store customers, Usman Ali shares some key strategies for successful pharmacy chain store management.
The points discussed in the video are listed below:
Retail chain pharmacy business requires central management. You need a clearer insight into how each outlet is performing. Only by having the entire information about each outlet at your fingertips you can implement the right decision for each outlet.
If you have two or more pharmacy medical stores, there are a few basic requirements to keep your pharmacy business on the successful track. Let’s have a look at the three such pre-requisites:
Seamless Stock Transfers from One Pharmacy Outlet to Another
If you are running a chain pharmacy business, the stock transfer process should be automated. You should be able to easily transfer stock from one pharmacy outlet to another based on the inventory levels and sales performances of the outlets.
For profitable stock transfers, you need reports that can give you an overview of the performance of each outlet. For example, if a certain product is not selling at one outlet, you should transfer it to the other location where it has better chances of getting sold.
Similarly, if one medical store is showing more profits, you should move your stock from the store that’s in loss to this profitable store.
Inventory Reorder Levels
As you know, you need to set inventory re-order levels for each branch so that you can maintain a certain amount of stock at each outlet.
The inventory levels are set according to the sales performance and also by making provisions for some safety-stock to avoid out of stock situations.
To be able to stay on the top of the inventory situation, you need a robust reporting system that can provide timely alerts about the stock situation.
If you think your software system is not up to the mark as far as the reporting is concerned, then you need to look for a better system in the market.
Centralized Retail Store Management
I cannot stress enough the importance of a centralized retail management system for retail chain pharmacies.
I have seen some retail pharmacy chains managing their businesses without a centralized management system. In such cases, all branches are managed independently. And when they need data of, say, stock or sales, they use a complicated method of compiling data.
This is what they do:
They get data files from each branch and give those files to the person sitting in the head office. S/he then compiles and combines the data from all the branches and upload the file in the head office system.
It is the Wrong Way to Build a Successful Pharmacy Chain Business!
This arrangement increases human interference at each step and thus increases the chances of errors plus data corruption. Moreover, it is not cost effective and can impact your profitability.
Now I want to point another HUGE MISTAKE that some pharmacy chain businesses make.
This mistake happens when you are using a system that does not support central price change management.
Let me explain what some pharmacy chains are doing and how it impacts their profitability.
As you know, price change management is of critical important. Whenever the price of any medicine changes, the biggest mistake that some pharmacy retailers make is define a new product with the latest price.
If you keep on defining new product every time the price increases, your system will show inflated stock. For example, if the code of Panadol is 01 and when its price changes, you again define Panadol with a new code & new price. If you keep doing this every time the price change, you will end having happens multiple codes of the same product. If you have, say, 10,000 actual products, your system inventory could be, for example, 30000.
Price change management, if not done properly, can hugely impact your business profitability, stock, sale, your decision making, etc.
What you need is a system that allows you to change price while purchasing new stock, and intimate you about the changed price at the time of selling.
I have discussed some of the area of critical importance that need to keep in mind while running a pharmacy retail chain.
If you have and questions and comments, you can write to us in the comment section below.