3 Powerful Money Making Tools for Independent Pharmacy Owners
A powerhouse in the world of independent pharmacy, Lester offers free business resources for Pharmacy Owners on his website, ThePharmacySage.com. Offering insight, wisdom, and strategy, Lester is an esteemed voice in pharmacy business. Lester helps his clients increase patients and profits in spite of the 3rd party payment fiasco.
Want to increase cash flow and profits? And create more wealth in the process? There are 3 powerful tools to accomplish that.
Want to increase cash flow and profits? And create more wealth in the process? Here are 3 powerful tools to accomplish that:
1. Analyze everything.
It is your job as the leader to determine what will work and what will not. Weekly and monthly analyses should disclose certain trends. When you dig deeply enough, you will find other numbers which can relate to standard industry norms—also other meaningful ratios within your own business. For instance, what is the trend in your natural med business and what is the trend in your compounding? Also, how do these numbers compare to last year for the very same month? If you’re information is not adequate, get with your bookkeeper and upgrade your entire financial reporting system. Some other things you may want to know are:
- What is your gross profit dollars per payroll dollar?
- What is the gross profit dollars per square foot in each of your departments?
- How profitable is your traditional script department when you factor in cost of labor?
- The top 20% of your most profitable patients
- The top 2% of your most profitable patients. (Properly marketing to them can make you extremely wealthy!)
Those are just some of the things you should be analyzing
A number of years ago, I had a client whose gift department occupied 1/3 of his total space. He maintained, that gift department was contributing 40% of his net profits. However, upon doing a Distribution Cost Analysis, I proved to him that not only was it not contributing 40%, it wasn’t contributing even 1%.
Get close to your numbers— analyze them— and constantly update your financial reporting system so that you can constantly use it to improve your future.
2. Tap into the collective genius of your staff.
Your staff has more talent and more wisdom than you give them credit for. All pharmacy staffs do. The problem is, you’re not tapping into that wealth of talent, intellect, and savoir faire that is available. Asking their opinions is a good starting point.
Holding a monthly staff meeting is a much more elevated approach. At these meetings, ask meaningful questions such as “what do you believe to be the single biggest problem facing us today?” When properly presented, with no responses being met with negative comments on your part, you will find solutions to some of your most potent problems.
Each staff meeting should consist of just 1 question, which poses a significant problem. Unanimity of opinion should be obtained. When the identification of the problem is finally obtained, it should be followed by the obvious question: what is the solution? Again, as answers come in, unanimity of opinion should be sought with no negative commentary.
You'll be amazed at the result you can achieve when you employ this particular approach to problem solving within your own pharmacy.
3. Market, and never stop marketing.
Make certain your marketing is the right marketing, the type that gets direct, immediate, and measurable results. Results you can take to the bank. At the very same time, you will be building your brand.
Marketing sporadically never gets the job done. Marketing consistently does. Its like putting gas into your car. You can’t do it just when you want. You need to keep the tank at least partially filled. And so it is with marketing. Constant and persistent marketing pays dividends. Both short-range and long-range when it is the right marketing.
Marketing online, as well as offline, is the order of the day. Online should be focused on your website, which, when properly done, should be geared toward creating sales of both products and services. Offline should be focused on using direct mail to send influential messages to the higher income families that surround your store.
If your goal is to create a better pharmacy that provides you with more money and is easier to run, then study and re-study those 3 powerful money making tools. You may find that they contain several gold nuggets for you to deploy and exploit.