Opening a pharmacy: the prescription to follow for a successful project
Do you want to open a pharmacy? You knocked on the right door! In this article, you will find all the information you will need to successfully complete your project in a highly regulated world, including tips for writing a pharmacy business plan.
Perform the market research of your pharmacy
First of all, it is essential to carry out your pharmacy's market study to identify the potential of your activity and validate your future marketing strategy.
For this, you will need to explore current industry trends, consumer habits and pay particular attention to choosing the area in which you plan to build your pharmacy.
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The French pharmacy market
Conjuncture
The pharmacy sector has been undergoing significant changes for several years. In this highly regulated sector, pharmacists depend primarily on the health policies pursued by the various governments.
Currently, the public authorities have implemented many measures penalizing pharmacists, such as new margin rates, tariff reductions, the deductible of 50 euro cents, the delisting of specific specialties, or the generalization of large packaging.
These policies have led to a decrease in pharmacists' margins on reimbursable drugs, which correspond to more than 75% of their turnover. Therefore, they are forced to turn to more profitable activities, such as para pharmacy or the sale of non-reimbursable drugs, for which they can set prices freely.
We can nevertheless note the implementation of other measures having a positive impact on the margins of professionals, those in favor of generic drugs, such as the "third party payment against generic" system introduced in 2012. The increase in open access sales also allows improve pharmacist sales.
Despite this, the turnover of pharmacies in France was down 2% in 2015, and we can also note that the closings of pharmacies are accelerating.
Typology of the pharmacy market
As of May 9, 2016, there were more than 22,100 pharmacies in France. Currently, two-thirds of pharmacists have chosen to group in purchasing centers to benefit from greater bargaining power over purchase prices.
The pharmacy market is split according to the size of the pharmacy. The latter varies mainly according to the geographical location of the pharmacy. There are generally more than five employees in town centers and shopping centers and a turnover of over € 760,000 per year.
Conversely, outside the city center and rural areas, there are smaller pharmacies, with between 2 and 5 employees, and annual turnover below € 760,000. The number of these pharmacies is in sharp decline.
Future trends in the French pharmacy market
The sale of drugs on the Internet is expected to continue to grow, further reinforcing competitive pressures. The new pharmaceutical agreement, implemented on April 4, 2012, should positively impact pharmacists via the principle of performance-based remuneration.
Some aspects of pharmacy regulation
Pharmacy is a sector whose access remains highly regulated. In order to open a pharmacy, it is compulsory to have the state diploma of doctor of pharmacy and at least 6 months of experience as a replacement or assistant. Opening a pharmacy without being a pharmacist is therefore impossible.
When setting up, the pharmacist must register with the regional council of the order of pharmacists. He must also obtain a license from the Regional Health Agency, which can impose a minimum distance with the nearest pharmacy.
The pharmacy sector is, in fact, subject to installation rules: one can only count one pharmacy for every 2,500 inhabitants (3,500 inhabitants in Guyana, Moselle, and Alsace), then one dispensary for every 4,500 additional inhabitants.
The number of pharmacists assisting the holder is also regulated. It depends on the pharmacy's turnover: one compulsory assistant between 1.3 and 2.6 million euros, two compulsory assistants between 2.6 and 3.9 million euros, then an additional assistant for every 1.3 million euros.
Choosing a pharmacy concept
Once the market research is done, it is essential to think about the type of pharmacy you want to open.
To fight against measures penalizing them, more and more pharmacists are choosing to specialize, for example, in homeopathy, dietetics, orthopedics, or even veterinary drugs.
We can also distinguish between pharmacies mainly selling reimbursable drugs from those specializing in the sale of "self-prescribed" drugs and para pharmaceuticals.
Finding a Location for your pharmacy
The creation of a pharmacy is increasingly rare due to stringent demographic limitations and complicated administrative procedures.
Under these conditions, most pharmacists who have just obtained their diploma choose to take up a pharmacy. , the two most essential criteria to select are the location (within a busy street or not, in an urban area or a rural area, etc.) and the quality of the premises (size, layout, etc.).
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Choice of the legal structure of your pharmacy
Once settled on the location, the next step in opening a pharmacy is to choose the legal status of your future business.
The choice of legal status should not be taken lightly as it will directly impact taxation and your liability as a manager.
The marketing plan of a pharmacy
Although pharmacies benefit from a natural demand generated by prescriptions from doctors, it is nevertheless essential to set up a marketing plan to recruit your first customers and then retain them.
The latter will largely depend on the type of target clientele, for example, promotional offers on beauty products for a drugstore specializing in this type of product.
Be careful because, here again, communication and advertising from a pharmacy are strictly regulated.
The Staff and Stock needs
When opening a new pharmacy, the initial investment concerns the acquisition of the premises and the shelves (which prove to be expensive because they must be equipped with reinforced warning and security systems), computer equipment, and cash registers and stock.
Staff costs depend on the size of the pharmacy. It is essential to look after the recruitment of its employees. The quality of the reception and the advice is given having a strong influence on the success of a pharmacy.
It is also recommended to hire a chartered accountant to assist you in financial management and to take out insurance that will protect you against the risks associated with your activity.
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The business plan of a pharmacy
An essential document to create a pharmacy, the objective of the business plan is above all to allow you to ensure the project's financial viability.
The business plan will also allow you to define your strategic, commercial, and financial objectives for the years to come and will serve as a reference document for your partners when seeking financing.
If you are new to writing business plans, or if you want to save time, an excellent way to simplify your life is to opt for specialized software.
Once you have your pharmacy business plan in hand, it's time to take the last step in building a pharmacy: finding funding.
Did you want to know how to open a pharmacy? We hope to have answered your questions with this article. Do not hesitate to contact us if you have any questions or start a pharmacy proejct.
