Our latest thoughts and inspirations on buying a pharmacy, starting a pharmacy, and ongoing pharmacy operations

Being an independent pharmacy owner.

There is much that can be controlled and predicted when you become an entrepreneur but that is not what I am here to talk about. Those who plan and listen to others will succeed especially in the independent pharmacy industry. The success attribute not often spoken about is the ability to problem solve. It is not possible to create a business without this skill. I wanted to provide you with some insight on the things that can happen so maybe you won’t feel alone when something similar happens to you, because it will!

Problems can be big or small but they all take time and can be very frustrating. I talked to a pharmacy owner one time that promised he would deliver to his patients. He leased a delivery car and hired a part time employee to do the deliveries. On the first day the employee didn’t show up and he got 5 delivery orders. As an entrepreneur, he said to himself, I will deliver the orders after hours, but when he went to do it the new leased car wouldn’t start. It was not a big deal he took his own car but these things happen and how you handle it daily can be the difference between succeeding and not.

We see two commonly used philosophies for valuating a pharmacy:

         1. Multiple of EBITDA

         2. Cost per Script

Multiple of EBITDA – Typically this is used when an individual or other independent is evaluating the pharmacy. These buyers will want to see at least three years of financial documents. This will include an income statement that should outline EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) and a cash flow statement. This tells the potential buyer what their return on investment will be and thus what the value of the pharmacy is to them.

What to look for when starting a pharmacy.

There is a lot to consider when starting a pharmacy but what I want to focus on today is the preliminary search. We find it best to look at starting a pharmacy as a big puzzle and each puzzle piece is one section of the start-up process. If you try to do everything at once you will make mistakes. Focus on what needs to be done first, do what you can for that step and then move on. The first step in our process is determining if there is opportunity in the target area. Below I have outlined some key areas to focus on when trying to find the best opportunity.

1. Determine if there are enough scripts being written in the target area to support a new pharmacy. You can do this in several ways, go into the pharmacies find out how many scripts they are filling per week or hire a consultant like us and we will do that analysis for you. You may also know this because a chain buys a busy independent but it is always good to do the research.

What Licenses are needed to open a pharmacy and how do I get them?

Can Independent Rx Consulting or anyone else help you speed up the licensing process for an independent pharmacy? Most of the time yes. The biggest factors within this is knowing what licenses are required, what you need to have prepared and where to get it. It isn't just a DEA license, you have the state board, 3rd party billing and employee ID's just to name a few.

Providing more than just connecting buyers and sellers, Independent Rx Consulting provides guidance and develops skill-sets for start-up and new acquisition pharmacy owners; providing a previously unmet need in the community pharmacy industry. One of the industry’s most renowned bloggers, The Honest Apothecary, interviews Independent Rx Consulting President, Owen BonDurant.

Chicago, Illinois - June 18, 2013 - Asking for help is okay. Isn't that what your parents always told you? It is also why Independent Rx Consulting is a business today. Jason Poquette blogger, pharmacist and founder of The Honest Apothecary is often asked by his readers for somewhere to turn for help and guidance on buying or starting a pharmacy. For Jason, it was easy to find that help for his readers through Independent Rx Consulting. A Chicago-based company with a unique approach in providing entrepreneurs of the community pharmacy industry with the skills and knowledge needed to start or expand their business, and position themselves for long-term success.
Read Jason’s entire article and interview with Owen BonDurant, President of Independent Rx Consulting.