What is new in 2023 at your community pharmacy?
As an independent community pharmacy owner, you don’t just want to tread water. Trying to stay in place while reimbursement for prescriptions decreases and competition increases is not a formula for long-term success.
Here’s an idea: each year add one new additional revenue stream.
Here are seven strategies that can make a big difference.
1. Finish what you started. Think back to early 2020. What were your priorities before the pandemic began? What was going to be your focus in 2020? Where were you making strides but hadn’t reached the finish line? Was there still room for growth in areas such as:
• Enrolling more patients in medication synchronization
• Delivering prescriptions in compliance packaging
• Increasing your provision of medication therapy management (MTM) services or comprehensive medication reviews (CMRs)
There were good reasons you made these ideas priorities in early 2020—and important reasons to set these priorities aside to focus on your patients and community. Now in 2023, there may be an opportunity to resume these priorities and make it part of the fabric of your pharmacy.
2. Grow your reach. Expand your pharmacy’s service area—without buying or building another store. Health Mart President Eyad Farah refers to this as “going beyond the four walls” of your pharmacy. Ways to increase revenue by growing reach include:
• Hiring more drivers to deliver prescriptions and OTC products to a broader area
• Opening a satellite location by staffing a site such a clinic, at an office or company, or at a school or a college or university
• Growing your pharmacy’s online presence by providing tele-pharmacy services or build a customer community on social media
3. Become a testing and immunization center. COVID-19 showed the importance of testing and vaccinations—and showed how well positioned pharmacies are to provide these services. In addition to testing for COVID, your pharmacy can test for flu and strep, and maybe also for HIV.
Then go beyond testing by becoming your community’s center for immunizations—for COVID, for flu and for other types of immunizations. Health Mart’s Farah noted, “I don’t think you can be a successful pharmacy business if you’re not doing immunizations. That’s part of what pharmacy will be in the future.”
Prescriptions Unlimited in St. Cloud, Florida started by offering flu shot clinics at schools. Now this pharmacy offers point-of-care testing and on-site vaccines to school employees, as well as specialty medications. Last year, the school district turned to the pharmacy to provide thousands of at-home COVID-19 test kits.
4. Pilot new clinical services. In addition to doing more MTMs and CMRs, look for opportunities to provide new clinical services needed in your community, and reimbursed by payers. Services might include health coaching, medication adherence programs or mental health screening. See what your community needs and what payers will pay for, and develop the capabilities and processes that are needed.
For example, Eric Larson, owner of Prescriptions Unlimited, saw an opportunity to provide transition care services. With focus and attention to detail, this service has grown to 30% of his pharmacy’s business. Larson also added a 340B contract and specialty medications.
5. Target health, not just disease. Help people get and stay well. Prescriptions Unlimited is part of a pilot to screen patients for diabetes and follow up every three months with interventions. If your pharmacy is offering diabetes education, think about adding weight loss or smoking cessation programs.
6. Supplement your revenue with supplements. Nearly three in four Americans take a daily supplement, making dietary supplements almost a $56 billion market. Various supplements help patients:
• Sleep better
• Protect their vision
• Stave off aging
• Alleviate side effects from prescriptions
Educate yourself about who can benefit from which supplements. Market your supplements, offer differentiating expertise and consider a private label.
7. Focus on your front end. The average margins on front-end merchandise are 15% higher than margins on prescriptions. But on average, only about 10% of an independent pharmacy’s sales come from the front end. With greater focus, creativity, increased marketing and offering products that appeal to your customers, you may be able to boost sales.
Independent pharmacies have drawn in customers with a wide range of offerings—ranging from fishing bait to fine wines. The key is to appeal to your customers through unique, compelling and profitable offerings.
You don’t have to do it all. Identify all the possible opportunities your pharmacy could pursue, rank them and commit to going full tilt after one new revenue stream. Then, at the end of the year, assess the results, identify how to improve and do it again.
Imagine how this can transform your business over the next five to ten years.
So, what will you pick this year?
Note: The information provided here is for reference use only and does not constitute the rendering of legal or other professional advice by McKesson. Readers should consult appropriate professionals for advice and assistance prior to making important decisions regarding their business. McKesson is not advocating any particular program or approach herein. McKesson is not responsible for, nor will it bear any liability for, the content provided herein.
1 “Thriving in the NEW Business of Nutrition,” Erin Hmielewski, PDS, Nov. 16, 2020.
2 “Total U.S. Dietary Supplements Market Size from 2016 to 2024 (in Billion U.S. Dollars),” Matej Mukulic, Statista, Sept. 19, 2019.
3 “Eight Solid Stats That Demonstrate the Independent Pharmacy Channel Is Right for Your Brand,” Jen Johnston, Hamacher Resource Group, February 21, 2020.
4 “Eight Solid Stats That Demonstrate the Independent Pharmacy Channel Is Right for Your Brand,” Hamacher Resource Group, February 21, 2020.