Given the sector’s recent instability, it is hardly surprising that some independents are considering closing shop. Mandeep Mudhar, director of marketing and professional development at Numark, addresses some commonly felt concerns
Q: As an independent community pharmacist (ICP), what are some of the early warning signs I should be watching out for?
Many (if not all) ICPs monitor their turnover on a monthly basis. However, to ensure you’re monitoring turnover effectively, compare the current amount in your till (funds generated through OTC), as well as your FP34 reimbursement, with previous months. Ideally, your script reimbursement should have increased with a market prescription volume growth of around 3%. Also, if need be, review your cashflow weekly. With prescriptions likely to be driving most of your business, it is important to monitor numbers closely. In addition to assessing numbers monthly, look at your YOY figures. If you notice a change in how much you are dispensing on a yearly basis, make a list of all the factors that could have led to it and plan how you can control each over the next three to six months. Take the time to analyse your footfall – your script volumes can indicate this. If footfall is lower than expected, consider what could have caused it. For instance, external factors such as new entrants (e.g. a Tesco Express) could be attracting your customers for everyday OTC medication.
Q: My team doesn’t always seem to agree with my approach to reviving the business. How do I get their buy-in?
Your team might need some coaching to be able to adapt and play a productive role in your plan to revive the business. Take time to help them see how your suggestions can actually benefi t the business. For example, if your team needs motivation to secure more repeat prescriptions, then they need to be trained to engage with patients differently. This could involve demonstrating extra care and attention, and convincing patients to have all their managed repeat services handled by the pharmacy. If your objective is to drive more OTC sales, then your staff need to be supported around link selling or maximising shopper spend in certain categories. While it is important to keep the long-term goals of the business in mind, what might be more useful is enabling your staff to have some quick wins – i.e. setting precise shortterm targets for them to focus on.
Q: Is it too late to carry out a root cause analysis (RCA) for the decline of some of my sales?
Never. Any business should conduct this regularly, whether it is annually or more frequently, if needed. It is the only way to get to the bottom of any potential issues with the way the business is running. However, to conduct a proper RCA, you have to be honest with the analysis. While there are obvious metrics such as script numbers, percentage of repeat scripts, and OTC sales, sometimes it can be very diffi cult to pinpoint exactly what it may be that needs more attention. It could even be a combination of factors. This is where Numark, for instance, can advise and offer tailored guidance.
Q: How can we focus on new sources of business when current services aren’t performing as expected?
Irrespective of current services underperforming, trying to offer new services is one of the few choices you have if you want your business to survive, and, ultimately, thrive in the current climate. You can, to a large extent, infl uence service provision and how your team manages it. For example, create opportunities to raise awareness about commissioned services – this can be as simple as highlighting those services to customers already visiting the pharmacy. For private services that are not performing as well as expected, it might be time to re-evaluate the potential of offering them. Whether it is existing or new services, it is important to explain their benefi ts to patients and show them how convenient and useful you – as their community pharmacy – can make the process of obtaining those services for them.
Got a question for the experts at Numark? Get in touch with us by emailing ICP@1530.com or tweet your questions to @NumarkNet, including the hashtag #ICPMay.