We all witnessed that the healthcare industry is growing at a rapid pace in India. The only reason behind it is the growing drug demand in India. People spend thousands on medication to stay healthy and cure ailments. Thus, you can say that the Pharma business is an evergreen business that is least affected by the recession.
Based on the worldwide pharmaceutical survey, India’s pharmaceutical industry ranks 4th in volume and 13th in value, with exports worth USD 2.6 billion and domestic sales of more than USD 4 million.
Also, India is one of the largest suppliers of generic drugs internationally, as it covers around 20 percent of the total drugs exports.
Post Covid-19, its demand has undoubtedly increased, and all medical stores have become dependent on services. Thus, you can consider it as a demanding business segment.
So, if you are thinking of opening a pharma business to get a long-term gain, you must continue with us in this blog till the end. This will help you find out how to open a Pharmacy store. And, what practices do you need to undertake in order to operate a pharmacy?
Index…
- How to Start a Pharmacy Business in India?
- What is a Pharmacy business?
- The Process to start a Pharmacy Business
- Challenges facing to start Pharmacy Retail Business in India
- Conclusion
How to Start a Pharmacy Business in India?
If you want to start a retail pharmacy store business, the first thing you need to do is to have a clear action plan. You must determine the size of your business and be prepared to deal with your competitors. And, at the same time, you must meet all legal obligations and tax liabilities mandated by law in India.
No doubt, opening an independent medical store is a challenging process. You need to research the market, make financial arrangements, know about medical store loans, obtain permits, hire staff, and much more.
What is a Pharmacy business?
The pharmacy industry is one of the strongest economies in the world today. Along with the importance of pharmacy stores in everyday life, Pharmacies also have a massive responsibility towards every customer/patient. A small mistake on their part can be fatal for the customers. Thus, medical stores often have to follow several legal procedures, locating restricted drugs, detailing different salts, and arranging drug stocks based on their inventory before selling drugs.
This way,
“The pharmacy business is all part of the storage, delivery, and sale of retail pharmaceutical products under a prescription order. Maintaining drug inventories, prescription information, and the necessary workforce to distribute and sell medications is also part of the pharmacy business. Aside from that, coordinating company practices with pharmacies, wholesalers, and manufacturers ensures a seamless flow of pharmaceuticals.”
The Process to start a Pharmacy Business
As per the current market scenario, the pharmacy business is ideal for many entrepreneurs across India. Let’s look at some steps for starting a pharmacy business in India.
Finding a sufficient store space
While deciding on opening a pharmacy store, you need to first think about the storage space and location. It is the first thing that ensures your customers rush and decide how you will manage them.
The next thing you should consider is going to the rental agreement or buying your own ownership with a minimum area of 10 square meters.
Also, you have to think about your targeting area and manage your inventory accordingly. Thus, just make sure that you have enough calculations on the rented shop + inventory items budget.
Arranging the Finance/Investment
Finance is a key requirement for the success of any business. Arranging the required finances for retail pharmacy store owners can be a daunting task.
That is why while opening a medical store, you need to plan how you can get maximum profit by investing less in the start of business.
There are two types of retail medical stores you’ll need to evaluate your finances. A fixed element to meet operating expenses like rent, electricity, salary etc.
The second element is finance, for purchasing inputs, medicines, and meeting contractual obligations. You should already have a strategy for both.
Thus, to start a store, you must have the capital for initial investment. You must be prepared for the initial investment to vary based on the location and scope of activities. You can also take a business loan for daily operations in the form of a working capital loan.
Business Registration
A medical license is mandatory to open a medical store in India. You do not have to worry about how to get a medical license in India, as the following organizations can quickly obtain it:
- Central Drugs Standard Control Organization
- State Drugs Standard Control Organization
Generally, two types of drug licenses are issued by the Drug Control Organization –
- Retail drug license
- Bulk drug license
You can take a license according to your business scope and business structure. For this, you have to fill out an application form. Also, to open a medical store in India and get a pharmacy license, every type of eligibility has to be fulfilled. After paying the fee, you are provided with a pharmacy license.
GST Registration for Pharmacy Business
GST registration is required in India whenever a business is selling goods or products. For pharmacy businesses, you must obtain GST Registration from the state your pharmacy store is located in and pay GST taxes.
Obtaining Drug License
A pharmaceutical license is required to start a pharmacy business. Drug licenses in India are regulated by the Central Drugs Standard Control Organization and the State Drugs Standard Control Organization. There are two sorts of drug licenses available: retail and wholesale.
A pharmaceutical license is required to start a pharmacy business. Drug licenses are issued by the Central Drugs Standard Control Organization and the State Drugs Standard Control Organization in India. A license can be obtained for two sorts of drugs: retail and wholesale.
Requirement of Drug license
Area: To open a medical shop, pharmacy, or wholesale outlet in India, you’ll need a minimum of 10 square meters for the establishment. A minimum of 15 square meters is required for a pharmacy that includes both retail and wholesale.
Storage facilities: The store should have proper labeling and storage facilities for medicines like refrigerators and air conditioners, computers and vaccines, injections and equipment, etc.
Technical staff: Because the sale of medicine by retail or wholesale pharmacy must be done in the presence of a licensed pharmacist approved by the department, the employees you hire must have a diploma or degree in pharmacy.
Procuring Supplies
Ensuring timely procurement of supplies is crucial to making a pharmacy business successful and meeting the customers’ demands.
For this, as a medical store owner, you need to stock a variety of medicines according to your business and customers. You should have adequate knowledge about drugs and drug salts.
So that if you do not have the medicine demanded by the patient, you can provide them with another medicine of the corresponding Salt. Because it increases sales and establishes trust for your medical store and a very important step to increase the revenue flow.
Hiring Staff
Starting any business requires a workforce. A dedicated team of workers takes a business to the top of success. But apart from a dedicated team, it is also essential for the team members to be skilled. Such a team completes the tasks in the minimum time & available resources and makes the customer happy.
For a pharmacy store, you should hire people who are informed about drugs, have previous experience working in medical stores, and have a strong understanding of medicine. Customers will not have to wait long as a result.
Prompt customer service will increase customer retention and generate higher customer retention for your medical store.
Be Digital Ready
Now businesses are going digital. Digitalization is today’s demand. It eliminates the old working pattern and automates the medial store business processes. It ensures quick access to stocks, efficient inventory management, quick ordering, billing, and delivery.
Now many pharmacy billing software is available for Pharmacy stores that ease store management. Also, accounting apps are available that offer smooth ordering and billing.
This way, if your medical store is digitally fit, it can help you run your business better, and you’ll get the following benefits:
- It boosts revenue while lowering losses.
- Improve your brand’s awareness and communication.
- Improve the quality of patient treatment.
- Give customers a better experience.
Marketing Your Medical Store
Nowadays, an effective marketing strategy is a reason for the success of every business. Due to the intense competition in the market, you need to have the right marketing strategy for your business.
That is why it is critical to market your newly opened medical store aggressively. You can do this by using digital platforms/channels and sending messages and emails to customers about your offers/discounts.
Advertising your medical shop on the internet is also a fantastic idea. You can also set up a website for your medical business and accept online orders. Your website should be attractive and informative. Customers can also receive free medicine delivery to their homes.
Above are some descriptions of procedures that need to be followed to start a successful medical store business. But, it is also essential that you are aware of the medical industry’s challenges to run a smooth business. Let’s know about these challenges.
Challenges facing to start Pharmacy Retail Business in India
Increasing competition and consolidation of retail pharmacy
As we all know, the pharmacy industry is in demand, so it is a challenge for every medical store owner to face the demanding market. To help maintain revenue health and protect market share, community pharmacies need to find new revenue sources and diversify services. These strategies are related to –
- Managing inventory levels
- Easy billing options
- Delivery facility
- Accurate accounting
- Easy and Simple GST Filling and much more
By choosing the right software system, you can get rid of these challenges.
Struggling to Make the Right Technology Choices
There is no doubt that they still people hesitating to use medical software in their retail stores. It may be due to budget limitations, or they may be afraid of operating software.
But it is need of today. Here, one more challenge occurs to make the right choice of technology software. Every pharma store owner should integrate with the software.
As a business owner, you should enable your pharmacy with technology that enhances quality assurance, reduces dispensing errors, boosts patient adherence, provides restricted drug management, easy billing, and more.
Building and maintaining a patient base
The number of independent pharmacies has declined from 23,106 in 2011 to 21,767 in 2018, according to the 2019 NCPA Digest.
As a result, attracting customers and becoming a requirement for healthcare providers is a struggle. Your pharmacy can take advantage of digital demands by figuring out how to increase your business, such as:
- You can attract an audience by using a digital marketing approach that incorporates a website, online reviews, and social media presence.
- Using digital technologies, such as the pharmacy mobile app, increases efficiency and provides patients with a comfortable, seamless experience.
- Providing services that are in high demand and helping with compliance
Declining cash flow and margins
Attempts to stay competitive in the digital age, rising costs and global crises are all affecting a pharmacy’s cash flow. According to the data, prescription and non-prescription sales have lower profit margins. As a result, especially for retail pharmacies, the danger of missing out on potential revenue is substantial.
- Patients’ requirements and the desire for a seamless experience are at the heart of successful independent pharmacies’ services and goods.
- It’s critical to take another look at your services to see how you may expand your pharmacy’s business.
- As per present demand, there is a need to change the most popular health products and their fulfillment techniques, which will attract the patients’ attention.
Conclusion
Although traditional pharmacies cater to the medicinal needs of the significant population of India. But now many things have to be taken care of in order to open a medical store.
You will need to fit into the Indian legal system, register your business and pay the relevant taxes. Apart from this, everything will have to be arranged with the help of technology.
In this way, you will be able to create a good situation for your pharmacy store business. I hope you like our research on the topic “How to Start Pharmacy Retail Business in India? Know Process & Challenges”. For more assistance, it would be best to contact our SWIL team.
Also Read Blog- An Overview of Pharmacy Management Software Market for 2021 and Beyond
