Looking for new pharmacy strategies to increase profits? When you consider there are pharmacies with $3M+ in sales, who are falling into the same hole of declining profits as smaller pharmacies then you know dwindling profits is not a “volume” issue. If you are seeking some ideas of how to generate more profit for your drug store the following are a few thoughts for kick starting the thought process for potential new pharmacy strategies.
22 Pharmacy Strategies for Generating New Profits
1. Natural Products – Many new pharmacy customers are in a generation that is spending more money on natural products. Marketing quality herbal, organic, and natural products will help bring new customers to your store. Natural products are also the type of products you can up-sell to existing customers. One natural product line we recommend is Natural Yucca Products.
2. Beauty Products – Beauty sells! Larger pharmacies are creating entire departments for this category. Is this an opportunity in your store?
3. Vitamins and Supplements – What are the demographics of your area? Marketing specific vitamins or supplements that match the demographics can drive new traffic to a pharmacy.
4. Women’s products (or any other focused product) – Niche products focused on the needs of women.
5. Kits – When this concept was introduced to PharmacyValuations.com the first thought was First Aid Kits, but there are many potential options. It is basically bundling specific and complimentary products for the convenience of the customer. The profit is in the bundling.
6. Private Label Products – Private Labeling promotes the business, keeps the name in front of the customer while they are at home, and can be very profitable. Learn more aboutPrivate Labeling.
7. Ethnic Foods – Considering the demographics around your neighborhood, is there an opportunity to introduce a profitable product line of ethnic foods for existing and new customers?
8. CBD Products – Products made with CBD oil are trending and sales continue to climb. These are high profit margin products that can be private labeled. CBD oil can be refined to levels, which includes free of any THC. Pharmacy owners that has started selling CBD Products have seen their profits increase. Offering CBD products will drive new customers to a pharmacy.
9. Amazon Sales – There are a number of pharmacies that have a basement or second story. This is space that does not generate profits. However, it can be converted to profitable space. Setup a DBA name (doing business as) that does not include the words pharmacy or drug store. By doing some research a business owner can find profitable non-regulated products to sell online. High school students can be hired to pack and ship products. Pharmacy owners have access to all kinds of wholesalers. Amazon is the largest retail platform in the world. Take advantage of what you have available to you.
10. Internet Marketing – A single pharmacy in 1,200 sq ft location was doing $16M in annual sales from niche products and a great marketing campaign. You can’t advertise the drug, but the correct method of marketing can bring a flood or new customers.
11. Social Media – Using the various social media platforms can assist in reaching new customers. Use the platform to target specific audiences. There are software programs that can assist with this. There are also professional companies providing social media services. A drug store owner could also employ a high school student to work on this marketing campaign.
12. E-mail – Collect your customers’ e-mail addresses. This can be done on your website so there is a double opt-in. Don’t spam customers, but occasionally send them a coupon for “E-mail Customers Only.” This keeps your name in front of them and brings them back to the store. A pharmacy owner can form a group of local merchants who share an e-mail list making it a larger list of customers and dividing the marketing costs between the merchants.
13. Press Releases – When there is something about the pharmacy that is newsworthy – announce it. This is not an advertisement. Press Releases provide free exposure. Did you hire a new pharmacist? Is the store involved in a local charity?
14. Contact Journalists Directly – Journalists love good sources of information and are always looking for quality sound bites from “experts.” They want views with different angles (the pros and cons of a story). They want information about the “story” but don’t want things that are obviously only promoting your business.
15. Pod Cast – Develop a digital healthcare program that people can download to their computers or phones. Make it a series, so people will want to continue to learn more. Have subscribers.
16. Local 5-Minute Radio Show – Provide healthcare conversation, news, or questions and answers during a radio show with a local station.
17. Direct Mail – As we analyze data pharmacy owners provide us, what we see is most pharmacies are spending $2,000 or less per year on their marketing. The marketing may include web sites, pens (advertising specialties), and occasional newspaper ads. Even with the digital age there is still an opportunity in direct mail. There is a very cost-effective way to target potential customers in your area. Contact PharmacyValuations.com to learn more about this strategy or any of the others presented here.
18. Long Term Care – Develop relationships with skilled nursing facilities, hospice, or group homes. Sales are more profitable, and this may open the door for other products.
19. Building Mini-Pharmacies – In medical buildings, build small or what we call mini-pharmacies (or Kiosks) that are focused on the needs of the patients visiting the doctors in that building. If the medical building is full of heart doctors – the pharmacy should be focused on heart medications and not every retail drug available. Building mini-pharmacies is also a strategy for companies doing mail-order and need a location in a specific area to meet State BOP or PBM requirements.
20. Health and Wellness – Add weight loss programs and other services to your pharmacies.
21. Tele-Pharmacy – Although this strategy comes with a tremendous load of regulation compared to marketing a niche product, there are profit opportunities with Tele-Pharmacy.
22. Acquisitions – Most pharmacy owners have competition down the street that are in the same position of declining profits. If there is an opportunity to combine the two stores, there is very reasonable financing available for pharmacy acquisitions.
As a national Consulting Firm, PharmacyValuations.com work with pharmacy owners all around the country. Pharmacy valuations, buying, selling, and financing pharmacies are the usual requests from our clients. Recently we have had more pharmacy owners contact us to discuss alternatives. This is why we have presented the above list of pharmacy strategies. This list is only a conversation starter. We could write a book if we went into detail of all aspects of each of the pharmacy strategies.
Also know, we have the software and a system in place to research wholesale products that can be turned into profitable niches for your store. If you have questions, or want to learn more, please don’t hesitate to contact us.