10 Important Steps to Prepare Your Pharmacy for 2014
Business and Operations
Act Now to Lay the Foundation for a Great Year
The 2013 holiday season is now behind us and a new year has begun. This represents a great time to take a step back, set goals for the coming year, review critical processes and procedures, and establish priorities. Here are thoughts on 10 basic but important steps to make sure your pharmacy gets off to a great start in 2014.
- Establish financial goals and a financial plan. Did your meet your revenue and profit goals in 2013? Did you control your operating costs and sustain or grow your margins? What areas of the business performed well in 2013, and where were your greatest challenges? Do you have clear goals for 2014? Have you put strategies and plans in place to help you achieve your goals?
Only a small percentage of individuals write down their goals, but those who do are usually much more successful at attaining their goals than those who don’t. The key is writing down goals that are specific, measurable and time-bound.
- Develop a strategic plan for (possibly new) clinical services. The mainstream and industry press is full of stories about pharmacies evolving to play an ever greater role in delivering healthcare services. Pharmacies are offering immunizations, providing medication therapy management (MTM), engaging in counseling services, focusing on specific patients segments such as diabetics, delivering adherence programs, providing compounding services — and more.
As you look ahead to the next year, what is one new clinical service that will differentiate your pharmacy from the competition and drive revenue? What steps do you need to take to begin providing this new service, or expand and emphasize an existing service?
- Review staffing plans and staff. After cost of goods sold, labor costs are an independent pharmacy’s largest expense, averaging about 14.5% of revenue, up from 12.5% in 2001.1
With this in mind, is your pharmacy staffed optimally? Do you have the right people in the right positions? Have you conducted formal reviews with each employee, with clear feedback about where they are performing well and where they can improve? And, are there employees who could benefit from focused training in any specific areas?
The start of a new year provides a great opportunity to review your staffing plans and staff to make sure you are optimizing the performance of your team and each individual on it.
- Ensure your staff is in full compliance with all licenses and requirements. First, as you head into a new year, this is an appropriate time to review the expiration dates on all pharmacy, pharmacist and technician licenses and renew if applicable. This is also a good time to ensure that all appropriate staff have completed state-specific continuing education requirements.
In addition, a new year is an appropriate time to check all employees against the OIG (Office of Inspector General) exclusions list and the SAM (System for Award Management) database, and to ensure compliance with any additional FWA (fraud, waste and abuse) federal and state-specific requirements.
- Make sure your pharmacy is compliant with HIPAA and all relevant regulations. Staying compliant is essential, and can be difficult based on the many regulations that exist and the frequent changes to regulations. Examples of regulations where compliance should be revisited include HIPAA, HITECH, and provisions of Medicare Part D related to preventing fraud, waste and abuse. (Health Mart University offers training in these areas.) CMS General Compliance Training is also important.
- Perform an assessment of your IT. Are your core pharmacy and administration systems up to date? Are these systems and IT tools helping you operate as effectively as possible, or are they holding you back? Are you fully leveraging technology in your delivery of clinical services and adherence programs? Where could strategic investments in technology improve your operations and profitability this year?
Take the chance to take a step back and ask if you have the right technology platform and tools in place for your pharmacy over the next few years, or if this is the right year to make investments in this area.
- Purge unnecessary records. Pharmacy owners tend to save numerous records for long periods of time, including hard copies of prescriptions, insurance payment paperwork, Medicare billing paperwork, invoices, statements, delivery logs and much more. But do you need to keep all of these records? Take a few minutes to understand the retention requirements for various records (such as requirements related to Medicare Part D) and then look into purging anything you don’t need to keep.
- Review your website and social media presence. Often we get busy with our day-to-day operations and take our online presence for granted. Yet increasingly, consumers’ opinions are based on the impression they get from a website. Is your website a good reflection of your pharmacy? Is it updated and impressive? Is it constantly populated with new and relevant information? Are you using search engine optimization (SEO)?
And, beyond your website, are you using other types of social media tools to engage and communicate with customers and members of your community? Are you fully leveraging Facebook? What about Twitter or other social media tools? SmartRetailingRx has profiled several pharmacies that are using the Internet to enhance their brand. As we start a new year, make sure that your website and social media activities are making the impression you want.
- Lay out a marketing plan for the year ahead. It is good to start the year with a marketing plan, with different areas of focus for each season and month. This can include community-based promotions and partnerships with non-profits focused on areas such as diabetes and cholesterol. See this calendar, which highlights major events throughout the year, and a recent SmartRetailingRx article about the importance of having a marketing plan.
- Take a fresh look at your front-end presentation. Just as the start of a new year marks an opportune time to review your financial goals, staffing, website and compliance with regulation, it is also a good opportunity to look at your physical facilities. Is your exterior modern and welcoming? What is customers’ first impression when they enter your store? Take the time to be objective and see your store — both the outside and the inside — as customers do. Think about signage, lighting, layout, shelving, cleanliness and more.
So, what are your priorities for 2014? What will make 2014 a great year? Each of these items is important to your pharmacy’s success in 2014. But, as you head into a new year, you are more likely to succeed if you decide on a few major priorities. This may be offering a new clinical service, implementing a new IT system, or using social media to launch new marketing efforts. Decide on priorities, develop specific goals, communicate them, engage your staff and patients, and regularly measure the results.
Download the 1-page “Goal Setting Worksheet” to help you sort out the goals you want to prioritize and activities that will drive your success this year.
And Most Importantly …
After deciding on your strategies and plans, it is essential to put in place and commit to a monthly routine to review these plans and make adjustments. Developing plans and deciding on actions is meaningless if you don’t constantly review your plans and modify them as necessary.
Act now to put strategies and plans in place for a great year, along with a disciplined review process.
What advice do you have for other pharmacy owners about planning for 2014? Share your comments below.