How Independent Pharmacies Beat the Chains in 2009
Dr. Adam J. Fein recently posted an interesting question on his Drug Channels Blog regarding pharmacy store growth:
According to the new 2010-11 NACDS Chain Pharmacy Industry Profile, which of the following pharmacy formats had the biggest growth in number of locations in 2009?
- Chain Drug Stores
- Independent Drug Stores
- Supermarkets
- Mass Merchants
The answer? Independent Drug Stores.
Dr. Fein showed that independents added 474 locations (+2.3%) in 2009, almost three times as many as chains (+177 locations, +0.8%). In addition, the newly-revised NACDS data also shows the number of independents increasing by 1% over the past seven years instead of declining by 10%.
To the rest of society, this is most likely a shocker because it feels as if a new CVS is opening down the street every other day. However, to the PDS team and many of our powerhouse independent pharmacy owners, this isn't a surprise at all.
We believe that now, more than ever, there is an opportunity for forward-thinking independent pharmacies to take business from weaker competitors that are increasingly worried about uncontrollable industry issues such as PBM abuses, mail-order, and aggressive chain pricing strategies. While many companies are cutting back and hiding in fear instead of learning, planning, and attacking a huge opportunity, the independent pharmacy owners in the PDS community are passionate about continuing their education and growing their business. They are armed with proven pharmacy marketing strategies and business growth tools like SyncRx, the Pharmacy Direct Mail program, BHRT training, and pharmacy continuing education courses that position themselves to gain even more market share and increase profits.
We often hear Dan saying, "In times of change, learners inherit the earth, while the learned find themselves beautifully equipped to deal with a world that no longer exists."
This quote by Eric Hoffer perfectly sums up why we are seeing many of our members experiencing growth and opening additional pharmacies each year. These pharmacy owners understand the formula to success: continuous business education.
On the other hand, the New Data on Pharmacy Industry Market Share showed that both total revenues and number of prescriptions continue to decline at independent pharmacies. Thus, the average independent survivor is smaller and less productive than the chain drug stores.
While it may be hard to ever "out grow" the chain drug stores, it is possible for independent pharmacies to take charge of the things they can control, continue growing their prescription count and OTC sales, offer an extraordinary customer experience, and remain flexible during a period of industry change.
Looking forward to 2011, how do you plan to take your business to the next level?
