Retail Know-How for Pharmacy Mike Hewitson, NPA Board Member Independent Proprietor source of info: http://www.npa.co.uk/Documents/NPA_Conference/presentations/Retail_Know_How.pdf

1. Retail Know-How for Pharmacy
Mike Hewitson, NPA Board Member
Independent Proprietor

2. Why is retailing important?
Not dependent on NHS business
Generates cash-flow
Generates footfall for other services
Projects your business image to your customers

3. Developing a strategy
Identify strengths and weaknesses of current performance
Research the market
Identify opportunities and threats
Make actions SMART
Review performance and if necessary refine the strategy

4. Information is Key
Do you know what is and isn’t working in your retail
environment?
SWOT analysis is a good starting point to develop a
strategic plan
Key Performance Indicators (KPIs) are markers which you
can use to assess the impact of changes
on your business
Research your market

5. SWOT for Retail Pharmacy
Strengths Weaknesses
Personal service Price
Customer knowledge Infrastructure
Existing relationship Lack of branding
Trust Poor/no marketing
Flexible & responsive Confidence to invest
Opportunities Threats
Online retailing Supermarkets
Older population Online retailers
Up-selling Wider economy
Cross-selling
Reward loyalty

6. Retail KPIs
Footfall
Average sale value
Top-selling products by value/volume
Missed sales: frequency, value & products
Stock-holding
KPIs are the pulse of your business - they aren’t just for
large companies

7. Researching the market
Market trends & analysis
Look at what competitors are doing.
Look at changes in the local population or local shops -
local media good potential source of information
Spend time, not money

8. UK Health & Beauty Market
During the recession consumer spending on Health & Beauty
rose by 3% to £17.1bn
Cosmetics is a growing market +5.4% in 2010
Skincare set to overtake OTC as the largest category
Understand changing demographics:
Older people are a growing market and have specific
needs and disposable income
Birth rates are falling - lower demand for babycare, also,
customers driven by value

9. Improving retail sales
Marketing to maximise footfall
Staff training
Merchandising
Retail layout
Pricing strategy

10. Marketing your business
Attract and retain customers
Identify and communicate the benefits and USPs of your
business
Flexible plan which can change if needed
When consumer spending is tight, reducing spending on
marketing is a false economy
Avoid spreading budget too thinly

11. Staff Training
Are retail skills part of your routine staff development?
Consider staff training to improve customer experience
Train staff to up-sell i.e. offer other relevant products to
customers already making a purchase
Devote time to review performance and offer individual
feedback to members of staff
Consider regular staff meetings to reinforce key sales
messages or boost product knowledge

12. Merchandising
Product displays should not be an afterthought, they are
important to the image that your business projects
Don’t have to spend a fortune on new display materials: rotating
merchandise, changing displays or changing signage can make
customers feel that you always have something new to offer
Cross-merchandise i.e. position related items close together e.g.
memory cards with cameras. Must be logical (and obvious)
Understand human nature

13. Retail Layout
Several basic models for laying out your retail space
Diagonal -
Encourages
customers to move
Straight - Good sight around shop Mixed - uses a
lines. Uses space variety of display
efficiently. Basic types. Draws traffic
design to walls and back of
shop

14. Pricing Strategy
Understand the difference between cost and value - make
sure your customers do
High prices could = high quality to some customers.
Converse could also be true
Slashing prices can harm long-term profitability
Pricing tactics: Discounting, Loss leaders, Skimming,
Penetration

15. Strategy Review
When you have implemented your retail strategy, it is
important to review performance regularly.
Refer back to KPIs, and track performance.
If necessary tweak the strategy.
Don’t become complacent. The retail environment is
constantly evolving, stay still at your own peril!

16. The Proof: Central Pharmacy, Cardiff
- High-end
skincare, cosmetics
and fragrance.
- £15k retail sales
per week.
- Online turnover
c£10m.
- Clarins salon.
OWNER: RAJ AGGARWAL OBE,
NPA BOARD MEMBER

17. “KEEP MOVING FORWARD, KEEP INVESTING, KEEP UPGRADING,
KEEP UP TO DATE, KEEP LISTENING & TALKING TO CUSTOMERS” –
RAJ AGGARWAL