Location of pharmacy

[farmadiazepine]

Hi everyone,

Just wanted some input from the SDN board. I will eventually ask some owners I know what they personally think, but I do value the opinion of a lot of people here. A very general question, and I know there are many factors to consider, but if I were to open a pharmacy location in northern NJ in a town which only has only one CVS, and if I were to open the pharmacy a block away from the CVS, would that would a good idea or bad idea? Your opinions and advice much appreciated!

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[Dr Wario]

It would really depend on a host of other factors such as traffic in the area, proximity to prescription sources and costs associated with the particular area. Now if you are only looking at proximity to the CVS, I would look at how well that particular store is being run. Are you seeing long wait times and generally unhappy customers that you could better serve, or are the people getting their scripts fast and leaving generally happy? What can you do for the patients in that area that the CVS is not doing?

 

[farmadiazepine]

It would really depend on a host of other factors such as traffic in the area, proximity to prescription sources and costs associated with the particular area. Now if you are only looking at proximity to the CVS, I would look at how well that particular store is being run. Are you seeing long wait times and generally unhappy customers that you could better serve, or are the people getting their scripts fast and leaving generally happy? What can you do for the patients in that area that the CVS is not doing?

I'm only looking at proximity right now. I know for a fact this is a terribly run store. I know for a fact it is "busy" but that's relative to area. The store is located on a street with lots of foot traffic. I have yet to figure out what service I can do that the CVS is not providing other than home pick up and delivery and simple compounds.

Dr. Wario, do you work for a chain or do you own your own pharmacy?

 

[HouTX]

one block away on same Main Street or one block away on a side street?
patient population percentage? (Medicare, cash, private, Medicaid)

 

[farmadiazepine]

One block away on the same Main St. The street is literally called Main St. The patient population percentage is a mix, I'm not 100% sure but I know there is a lot of medicaid, some cash, some private, and medicare.

 

[Dr Wario]

Dr. Wario, do you work for a chain or do you own your own pharmacy?

I work for the same chain that you escaped from, but I do own a business also (currently providing close to 35% of my pharmacist's income). I find that a business mindset transcends all fields, it is just the small details that you need to work out. By the way, if the CVS you are looking to move close to is poorly managed, perhaps the service that you can provide is service.

 

[HouTX]

location sounds good. you definitely want to talk to an owner operator and see what kind of reimbursements they are seeing from their payor mix. from my limited data (I work for a chain), I can see that a fellow store does 2000 more prescriptions per month but have no more than $5000 gross sales versus my store.

 

[BMBiology]

Location is important but I wouldn't place too much emphasis on that CVS poor service because the staff can be replaced the next day.

Convenience and pricing is the key to beating CVS. Are you willing to be opened 12 hours a day? Including Sat? Do people know you would offer the same price as CVS?

Have you been talking to medical offices around the area? Nursing homes?

Are there also other independent pharmacies around the area? Do they cheat like paying doctors for prescriptions? What is their strategy?

What is your plan to getting customers over to your pharmacy? People especially the elderlies do not like changes and I don't think providing better service is enough.

Most businesses fail not because the lack of capital but the lack of brain and effort. Are you opening a pharmacy because business is your passion and you are good at it, not because you don't want to work for CVS?

 

[Aznfarmerboi]

Location is important but I wouldn't place too much emphasis on that CVS poor service because the staff can be replaced the next day.

Convenience and pricing is the key to beating CVS. Are you willing to be opened 12 hours a day? Including Sat? Do people know you would offer the same price as CVS?

Have you been talking to medical offices around the area? Nursing homes?

Are there also other independent pharmacies around the area? Do they cheat like paying doctors for prescriptions? What is their strategy?

What is your plan to getting customers over to your pharmacy? People especially the elderlies do not like changes and I don't think providing better service is enough.

Most businesses fail not because the lack of capital but the lack of brain and effort. Are you opening a pharmacy because business is your passion and you are good at it, not because you don't want to work for CVS?

BMBiology pretty much sums up all the points I was going to say. I am going to reiterate some points and add some...

Don't focus on CVS poor service because the staff can replaced the next day. CVS can also be your biggest referral source. I send away all of my compounds, surgical, nutrition, etc to independent pharmacies near me.

What is the market in your area? In NYC, HIV meds and anti psychotics pay the most. Also specialty drugs if you can get a hold of the scripts. Those customers are worth ten times as much. The profit on those drugs can go for 20 to 100 dollars profit a bottle... not including other drugs they are on to manage their disease state.

The one statement that I do not agree with BMBiology on is about service. Elderlies like to feel respected, and not be told what to do by a 25 year old new grad. An independent pharmacy that offer them hot tea or water while they are waiting, free deliveries (which CVS does not offer in some markets), along with other things can make a difference between their scripts coming to you vs CVS.

 

[BMBiology]

^ just to clarify, I didn't say service is not important. However, I do not think it is enough for people to change their pharmacy. If they are still with CVS even with the poor service, there must be other reasons why they are staying.

 

[BenJammin]

Yeah I wouldn't bet on getting business from CVS just because they're CVS. Right now their staff might suck but what are you going to do if you set up shop and CVS corporate decide to bring in the world's greatest pharmacist and technician to work at that store?

What I'm curious is whether or not it's beneficial to have a pharmacy nearby a hospital system. Are people going to use you just because you're right there or will they go home to their regular pharmacy?

+1 to BMBiology too. CVS may have the world's worst customer service but there has got to be a reason so many people trade with them.

 

[M0df]

I have a feeling you are going to be filling a lot of narcs that pharmacists at that CVS would gladly send your way. That in turn would actually benefit their customer service. Another issue is while you are going to be working for yourself and reaping the rewards, you might have to work twice as hard as you did for CVS by being so close to them. As others said, different mindset, so might be worth it. So it is really up to you if you want to gamble. We are talking about months down the line. You should be rested and recovered to do well.

 

[southpharmindy]

I don't feel like its hard to beat CVS. We beat chain prices all the time. We get transfers from chains all of the time. Mostly customers go to chains and independents for different reasons. Different type of customer. Typically when we win a customer they never leave.

You have to ask yourself what is important to the customer. Do they like the convenience of a 24 hour store, open weekends and holidays, multiple locations? Four dollar plans? If so they'll choose the chain.

On the other hand, we know our customers by their first name. We know their family history. We send gifts to baby showers and flowers to funerals. We don't have delivery but if a patient is in need we will get them their medicine. We keep extra staff so we can meet with patients/get their medicine done quickly. If personal touch and service is important, they will choose the independent.

I always recommend buying an existing store. If that is not your plan, have a professional do some data mining for you. Wholesalers can pretty well tell you the volume of prescriptions in a town and give you a breakdown of what those prescriptions are. Visit your local small business office and get some coaching; make sure your location and business plan are sound. Get someone to do some professional marketing/detailing for you. Hire an accountant and let them handle all of the money.