We’ve talked a lot about starting new businesses. Making a good impression, finding your voice, connecting with your audience, and improving your web presence are all important strategies that go a long way in making the final goal a reality. All well and good when you’re running an online business. What about when that goal is creating a physical location, though, like your own independent pharmacy? You’re going to have to take a lot more into consideration when setting up shop. It’s going to take careful planning, as this isn’t a venture that you can just jump into and expect customers to come flocking.
You’ll need that crucial plan of attack. If you’re starting up a new location, there’s a solid chance that you’re breaking into the territory of another independent or outpatient pharmacy that has been supplying people with their drugs for a while. How will you gain a share of this market? Will you offer a niche service? Cater to a particular demographic? No matter the approach, you’ll need to have an idea of the population and the local customer’s needs. You’ll need a way to market your services, and you’ll need a way to reach out to the community and get them interested in your location.
Speaking of which, location is key. Location goes for any retail-style business but particularly important for pharmacies. Why do you think the biggest businesses spend so much money on research before deciding which areas to locate their stores? If you see any of them nearby, you’ll know you’re close to the right spot. Conversely, if you see an abandoned pharmacy anywhere in town, you might want to avoid that location, or find out why they had to close up shop. In general, there are five factors you want to consider when selecting a location: Traffic, Opportunity, Visibility, Access, and Size. Some lists contain more factors, but the main point is that you should take location very seriously when starting your new pharmacy.
One of your greatest factors is going to be money. Do you know how much it costs to open a retail location? Some estimates put it at $882,352 – $1,764,705 per year for your typical startup costs. This figure is broken down into leasing your retail space, stocking inventory, staffing, etc. Because of these financial needs, you’re going to require start-up funding. A three-pronged approach works best: initial capital can assist with building/renovating/leasing the property, inventory financing will ensure you’ll have stock to sell, and working capital for your everyday expenditures. If you play your cards right, you may even see a return on your investment, and positive cash flow for your business in 9 months to a year.
Of course, this all assumes you can hit the ground running, which you can if you plan it right. You’ll need to be a well-oiled machine before you even open your business. Your marketing plan will start with introducing yourself to the community and making sure people know you’re coming in hot, but it also means making sure the internal workings of your pharmacy are fully functioning. A significant portion of this endeavor will need to focus on your “point-of-sale” solutions, which allow you to manage inventory, ring up customers, etc. Retail Management Solutions (RMS) is a good place to start if you aren’t wholly familiar with the concept and need some additional information about how to get your POS set up the right way.
Once you’re up and running, make sure you don’t fall victim to one of the many pitfalls which can wreck a recently created business. Things like failing to carve out your unique space in the market (are you the “friendly customer service guys”? The “we stock everything guys”?) Get your hook, roll with it and make sure you have enough capital to survive those early months. It will be tough, but you have to hang in there to start seeing returns. Whatever you initially estimated, plan on needing three times as much to stay afloat just to be safe. Be patient, and make sure you listen to any expert advice you’ve been lucky enough to receive.
It’s a long, hard road, but starting your own pharmacy can be rewarding (and profitable) if you go about it with the right plan for success!