Between PBMs, DIR fees, MAC pricing and clawbacks, the independent pharmacy owners we work with are hungry for proven strategies to transform their business. And who would blame them? Identifying ways to supplement your pharmacy’s bottom line is more important than ever with insurance companies and auditors regularly skimming from the top.
Our R&D team is dedicated to creating profitable and patient-focused member programs, such as RxAnalytics. This proprietary system analyzes pharmacy data to uncover specific ways to increase profit margins, but success is not just about making money.
Is this a shocking statement from the “pharmacy profit” guys? Absolutely! However, we know it’s just as critical to be an excellent team leader.
Every year at the annual PDS Super-Conference, we unveil the newest ideas and programs
programs guaranteed to push you past the competition, add cash to your pockets, and work on you as a leader. Why? Because that’s the accelerant for turning “We’re having a good year,“ into “Our accountant is asking why our profitability is this high!“
As our founder, Dan Benamoz, says, PDS can give you the tools necessary to start the campfire, but leadership will turn it into a roaring bonfire that warms everyone and everything. It’s the rocket fuel that gets the PDS programs not only up in the air but into orbit.
Do pharmacy owners forget to value leadership?
The short answer is no. Everyone has an idea of “good leadership” or can picture someone they admire. However, the reality is that pharmacy school taught you how to be a competent healthcare provider, not how to be a leader or business owner. And while some owners have a natural ability, it’s not the reality for most in this field.
In fact, there are three areas Dan believes aren’t discussed enough at universities that we’ve found to be a critical element to success: ethics, leadership and culture.
The root of unethical behavior is greed. It’s important to discuss this with pharmacy owners because the reality is that our industry, which is dictated by insurance companies and PBMs, is built on…well, greed.
Of course, we want to do the right things for the right reasons, and do them for the greater good. However, in this industry, owners sometimes find themselves pushing the envelope just to get by. They feel the only way to win is to cheat the game, which is simply not true. You can do what’s best for the patient and your business while still being able to sleep soundly at night.
As one of the most trusted professions, a title we all wear proudly, we’re here to improve society. We as pharmacists need to ensure we’re furthering that reputation, not hindering it, especially as we get closer to being more integrative in clinical practices. We have the trust and confidence of many people in the community, so it’s critical everyone is careful. What took our profession and your business a lifetime to build can be ruined with one small misstep.
Your team wants someone to follow. Someone who has a vision that will inspire them, foster job satisfaction and fulfillment, as though they’re contributing to something bigger than themselves. Being the pharmacy owner, inherently most of you have assumed the role of Leader. It’s a tremendous responsibility, and to succeed, it’s essential you know what the expectations are so you can cultivate the right work environment. You want your team to look forward to coming in and feel good about providing an essential service to patients in the community. Good leadership has a trickle-down effect, and that’s what we mean when we say quality starts in the boardroom.
What would the Philharmonic be without the symphony hall? Culture represents the environment in which you operate and while it can be hard to fully grasp, it’s critical to success. But is culture intentional or unintentional? For many pharmacies, it’s unintentional, which means they’re probably making some mistakes. If they simply knew more about what they’re doing, they could really set their business on fire. The good news is that it’s usually just a few broken links, not the whole chain. When you can identify these weak links, you can fix them and begin to nurture a culture with intention.
After profitability, employees are one of the biggest frustrations for business owners.
If employees are one of the biggest frustrations, how do we make sure we’re addressing the challenges properly? How do we get culture and leadership to work for pharmacy owners rather than against them? How do we get it to bring you joy?
While we have the programs and strategies to help, we still believe they are not discussed enough. That’s why leadership and culture are always a major theme at the PDS Conference and why we’re inviting the foremost experts to speak at the 2018 event. After all, we only want the best for our show.
We tend to keep our schedule for the show a surprise, but this year we’re so excited about the big names we’ve invited, that we couldn’t resist announcing that John Maxwell will join us in Orlando. He has authored more than 100 books, many being New York Times Best Sellers, selling over 16 million copies, and was named the #1 leadership expert in the world by Inc. Magazine in 2014.
John’s philosophy that “everything rises and falls on leadership,” motivates his every endeavor to help individuals reach their highest potential, both in personal and professional settings.
To him, there’s no higher goal than to help others realize their significance. He has dedicated his life to growing and equipping others to do remarkable things and lead significant and fulfilled lives. John will discuss…
- How to become a person of influence
- Develop the leader within you and those around you
- And, most importantly, how to fail forward
Community pharmacies play an important role and bring a unique value to the areas they serve. This role is particularly important when it comes to natural disasters. The threat of natural disasters isn’t new, but in light of recent times, there is an increased sense of awareness and need for preparedness if the next one is ‘The Big One.’
Under the HIPAA Security Rule and the Medicare Quality Standard, your pharmacy must have a Disaster Recovery Plan in place to implement. It’s a good idea to read up on your plan, research if it is still compliant, and go over this with your team, so there are no additional surprises beyond the stress of the natural disaster itself. Once you have your contingency plan in place, you are better able to serve your community and step in when the situation arises.
Increased awareness surrounding recent and impending natural disasters has driven states and organizations to establish and reassess protocols for disaster recovery plans. These vary state to state so independent pharmacies should confirm that they are up to speed on expectations. This isn’t the type of contribution that we are talking about though, we’re talking about a different list of things that you can do as your communities healthcare destination in support of first responders and federal help.
It all comes down to one overarching idea — Think Locally.
Your Role in Light of Disaster
As a local provider, nobody knows your community, their health care needs, and ailments the way you do. In the case of an extreme disaster, it is possible that responders may take days to get on the ground in your area. In the meantime, serve the community by acting as a liaison for communication, health questions, and readiness support until the Federal assistance arrives.
- If you have working phone lines, allow those who are displaced the opportunity to contact their loved ones and let them know they are safe.
- Remind your patients before an oncoming disaster to fill their prescriptions so they are prepared in case of service disruption after the event. Many patients require life-saving medications and do not think of refilling their medication in the chaos of preparing their homes.
- Provide disaster preparation checklists to your patients that include information on proper medication storage, water safety, shelter, and resource information.
- Reach out to local health officials and offer your services as a community resource center in the event of a disaster.
- Make connections with pharmacies in other areas that may provide services that you do not cover. If one distribution center is depleted, you should always have a backup plan for necessary medication and supplies.
- Be willing to jump in and open your store up to provide life-saving products, equipment and shelter to those in need after the disaster passes. Sometimes people just need a working outlet to charge their phones to reach loved ones.
The key is to have a plan and build the connections before the disaster hits. Practice and test your plan frequently enough so that when something happens, you are prepared to serve your community in what may be their darkest time of need.
PDS Stands With Those Affected by Hurricanes Harvey, Irma and Maria.
PDS believes in the strength of communities and supports businesses across the nation and abroad. Our hearts are with those displaced and affected by hurricanes Harvey, Irma and Maria. If you wish to donate, to hurricane relief, please find a list of charities below:
This is just a short list of groups dedicated to provide relief to those affected. Please take the time to donate and keep the victims and communities in your hearts.
As an owner, what is your first instinct when you stare headlong into another business challenge? Do you immediately lay claim to a solution and disregard input from others? Or, are you the type who treats challenges as an opportunity for growth and improvement?
FACT: No leader can solve every problem or claim to have all the answers.
What they can do is harness one of the most important, yet underestimated skills in any professional repertoire. This skill is the underlying current of PDS; it is what drives us to excel. Our most successful members have grasped this concept and continue to run with it to grow their businesses to reach unimaginable heights.
For 2018, we are focusing on one of the most important lessons every successful member knows, and every entrepreneur should learn: Stay Coachable.
What does all this have to do with announcing our first keynote speaker? Simply put, everything. The exceptional speaker we are revealing has been communicating this message for nearly 40 years as a leadership guru and international keynote speaker.
We are bursting at the seams to tell you that our first keynote speaker who will grace the big stage at the 2018 PDS Super-Conference is the legendary leadership extraordinaire himself… John Maxwell!
John has become a household name and has stayed at the forefront of transforming millions of people into exceptional leaders. The core of his message perfectly aligns with PDS’ mantra: it is never too late to start living up to your potential.
How do you recognize if you are keeping a coachable state of mind?
John Maxwell has identified a few key identifiers to help you understand what makes someone coachable.
- Coachable = Approachable | Someone that is coachable has to have a degree of openness and acceptance; they have to be willing to listen to things they may not want to hear, but they need to hear. They have to be willing to actively listen and apply knowledge without bias on where the idea came from.
- Learn-it-all’s, Not Know-it-all’s | As the saying goes, if you are the smartest person in the room, you’re in the wrong room. If you’re running your business without consideration to the type of value others can bring to the table you are missing out on a wealth of information. Closing your mind to the knowledge and ideas others bring is equal to shutting the door on growth.
- Shifting Gears: The Lynchpin of Leadership | The challenges will never stop, if you’ve been in business for more than a day, you’ve likely picked up on that lesson. What’s the key to managing it all? Shifting gears. Taking a critical look at yourself is just as important as taking an objective and analytical look at the situation. After all, is it possible that you could be the problem?
When we say that the PDS Super-Conference is the most important pharmacy business conference of your career, we aren’t exaggerating. The show we produce is a direct reflection of the PDS core values and is tangible in every aspect of our conference.
If you are a pharmacy owner, manager, employee, or in the pharmacy industry, you owe it to yourself to experience this conference that attendees have been calling year after year “transformational,” “magical,” “breakthrough.” You get the idea.
Don’t believe us? See the results yourself. Join us in Orlando, FL on February 22-24, 2018. You will not regret it!
Non-PDS Members: Our September Offer to You
Here at PDS, we take pride in highlighting some of our incredible solutions partners. We know these companies have the potential to revolutionize pharmacies just like yours through their products and services. We’re excited to introduce Sykes & Company P.A.; read on for their sponsored blog post about why your business needs a pharmacy-specific CPA.
Running your pharmacy is tough, especially in today’s environment. It is important you have a pharmacy-specific CPA in place to help make sure every aspect of your pharmacy’s accounting is taken care of.
When you are looking for a pharmacy-specific CPA, you’ll need someone who:
- Will help improve your daily processes
- Assist with tax reduction
- Provide advisory services critical to your success
The top 6 reasons you need a pharmacy-specific CPA
- A pharmacy CPA knows your industry.
Pharmacy is much too complicated to not have a CPA with experience and contacts in this industry. You should always ask how many pharmacy clients they have as well as basic questions about inventory, third party accounts receivable and gross margins. A CPA with specialized pharmacy knowledge should be relentlessly analyzing these three metrics daily, monthly and yearly, asking the questions that matter and comparing your information to your peers.
Actual inventory counts, perpetual inventory, and monthly dispensing audit logs play an urgent role in analyzing the performance of your pharmacy. Your CPA should be staying on top of your inventory every month and providing valuable feedback.
- Third Party Accounts Receivable
Third party accounts receivable make up a huge portion of your gross revenues with daily EFT deposits and paper check payments. With such a large amount in play, your CPA should understand what your AR third party is, what a reasonable AR third party balance should be for your size pharmacy, and how AR third party impacts your margins.
Did you know that most taxpayers are required to report AR third party on their tax return? Believe it or not, many pharmacy clients we bring on board do not comply with this basic IRS rule, mainly due to lack of CPA experience with pharmacies.
- Gross Margins
Anyone with pharmacy knowledge understands the importance of maximizing gross margins. Each percent increase or decrease in margins can have a huge impact on your bottom net income amount. With such a large amount at stake, your CPA must understand what impacts your margins and what a reasonable and accurate depiction of your gross margin should be for your pharmacy based upon your “blend” of revenue (ie: compounding, specialty, DME, OTC etc.). And, they must have experience about how to help boost margins. Your CPA should also know where you stand vis-a-vis your peers in the industry of similar size revenues.
- A pharmacy CPA is responsive.
When you have a question or a need, you shouldn’t have to wait a few days for a response. In today’s environment, people want instant feedback, so find a CPA who provides an instant response. This keeps you informed every step of the way.
- A pharmacy CPA is proactive.
In addition to being responsive, you want a CPA that is proactive. Many CPA and accounting firms are reactive – it is the nature of the industry. However, times are changing and being proactive is what the best firms are doing for their clients. The best firms are constantly being proactive and thinking several steps ahead for their clients.
Finding these attributes are crucial to you and your business. If you desire to be steps ahead like some of your most successful peers, you need to surround yourself with the right team.
About the Author:
Sykes and Company P.A. is a qualified, responsive and proactive CPA that can help pay huge dividends for you and your business. If costs are an issue, remember the saying: if you think it’s expensive to hire a professional, wait until you hire an amateur.
Independent pharmacy owners have multiple items on their to-do lists, with the most important being properly dispensing medications to ensure their patients recieve the right dose to get well. Running your operations and implementing new programs, all while keeping up with employee morale, can often get pushed to the side. These details may seem minor, but they often what take a back seat and in doing so, negatively impact your business.
Don’t Just Survive. Thrive.
Pharmacies have many opportunities to add additional revenue utilizing their existing prescription customers. You just have to take a deeper look into what you’re already doing. Below are our top 3 ideas to increase revenue without expending too much effort.
- Idea 1: Take a visible end cap on a heavy traffic pattern isle and fill it with seasonal items that are already on your shelves.
- Idea 2: Place a tester for a hand or pain relief cream on your wrapping counter. It’s all about the laws of percentage!
- Idea 3: Recognize which shelving in the store has the most visibility to your customers while they are waiting for their prescriptions to be filled. Find the sections that could be communicating “buy me” while a patient is standing or sittiing down waiting. Make sure to have the right mix of impulse, trendy, cute and useful items.
Cost-Saving Tips to Keep in Mind
- While snacks and candy seem like quick and easy sales, the reality is that their profit margin is too low and take up too much valuable real estate.
- Some specialty candies down low will do the trick especially as “distraction” candy for kids.
- Make sure to stock items that are fun versions of old standbys, such as:
- Neon or animal print nail clippers
- Cell phones paraphernalia (Only EVERY customer over 8 has got one!)
- Pain relief products, or sleep aids
- Unique pill holders (this one is a fast seller!)
There is no playbook or blueprint that guarantees what you should be offering in these highly visible and high-traffic locations – all it takes is trial and error. Your traditional wholesaler carries general drugstore merchandise that you can find in every chain drug, grocery and dollar store. Become the destination for products other than the predictable OTC drug necessities!
Finding the Best Resource for Specialty Items
We live in a society that is constantly consuming. Whether your customer needs a modest gift to give or wants the latest gadget or gizmo, keep something on shelves they’ll be willing to buy. With desire, modest effort and a reliable resource, you can start to fill your registers with much needed augmentation for the low reimbursements you’re receiving on prescriptions.
About the Author:
Langermania is the leader in providing specialty products for independent pharmacies to grow their revenue. Many of our products are not found in the chain stores, eliminating the worry of competition and keeping up with the latest products. We work diligently to source the latest trends to be able to offer over 7,000 stores unique items. Visit our website to see more of what we offer and how we can help grow your independent pharmacy.
For 19 years, PDS has been working with independent pharmacies, just like yours, and we’ve heard the same complaints and frustrations time and again.
“I’m tired of working so hard for such little return.”
“I dread going to work every day, not knowing if tomorow is going to be okay.”
“I don’t know how to get ahead with everything beating down on me.”
“I’ve opened my own pharmacy; what do I do now?”
And for 19 years, we’ve heard you loud and clear. Pharmacy business development is our thing, and we’re the best in the world at what we do. If you or someone you know has said anything remotely close to what you have read in the lines above, take a moment to collect yourself because now is the time to pay attention. After all, what is 12 minutes of your time when it comes to the success of your pharmacy business?
In this short video we want to show you an open door that will lead you and your team to an entirely new way of thinking about pharmacy ownership.
We get it; we sell access to a premium pharmacy membership for a living, so why would you listen to us when we say our stuff works? Because this isn’t about us selling anything to you; this is about you, the pharmacy owner. It’s always been about you, our passion for the industry, and showing owners, just like you that there is a better way. We’re on a mission to change the industry, one pharmacy at a time.
Listen to the real results that actual pharmacy owners are achieving. The proof is in their numbers.
If you want to skip the video, we get it, you’re busy, so we’ve placed a few highlights below. These results are directly from the mouth of two pharmacy owners. One is a long-term PDS member, and the other has only been a PDS member for under 5 months. Keep that in mind — these results have been acheived in only 5 months.
- New Member Pharmacy Owner (Under 5 months as a PDS member)
- Earned $24,000 within the first 14 days of PDS membership.
- Started with an average profit margin of $9.50 per script, she is now at $17.40 per script all from one program.
- This translates into $11,200 per week; $44,800 per month; $537,600 per year in additional profits.
- She was able to give staff $13,000 in bonuses for the first time. How do you think that boosted team morale?
- Long-term pharmacy owner and PDS member
- Consistently ahead of the curve and he is now an early adopter of the latest ‘golden egg’ programs that consistently increase his profits.
- Started at about $12 average profit margin per script, and he can’t remember a time in years when he has ever fallen below $20 average profit margin per script.
Watch these pharmacy owners share their aha moments with you. It gives us the goosies every time we watch it.