Pharmacy owners are really no different than the owners of any other types of businesses. Everyone can agree that owning a pharmacy presents the owner with some very unique challenges and requires very specialized knowledge when compared to most other industries. However, the basic rules of running a business still all apply to owning and running a successful pharmacy operation, whether it’s a retail community pharmacy, specialty pharmacy, compounding pharmacy or even a mail-order operation. Having opened up hundreds of pharmacies throughout the nation, having an expert help out with your pharmacy startup is obviously a great way to get started. But what happens after the startup is completed? To help every pharmacy owner to be as successful as they possibly can (and of course be more profitable), here are several strategic ideas that have been shared by numerous successful business owners.
Have a Business Plan
Having a business plan is essential for success. Consider it to be like a road map. Would anyone travel to their destination without a road map (or these days a navigation unit)? Eventually you may get where you were going, but the route you traveled may not have been the most efficient or fastest way to have gone. The same is true in any business. A written business plan lays out the proposed route to success. Keep in mind that the plan is never “written in stone”. It must be flexible and adjustments often need to be made due to unforeseen circumstances or new changes in the pharmacy profession. Yet not first “mapping” out and planning your business strategies will hinder both your growth and profitability.
Strategic planning for a pharmacy business or operation is crucial in today’s complicated environment. Being prepared for new legislation and the constantly changing insurance issues makes strategic planning a must. Strategic planning and pharmacy consulting are areas that most pharmacy owners don’t take advantage of until it is too late. So why not start off the right way with a solid business plan to help you get where you want to go faster and efficiently?
Set SMART Goals
Setting goals is a key to success for not only owning a business, but for all facets of an individual’s life. This has actually been proven by numerous scientific studies, perhaps the most famous one being a study conducted by Harvard University. The study looked at the monetary success of graduates from the Harvard University MBA Program 10 years after they graduated. What the study revealed was that those graduates who had written goals accounted for approximately three-percent of all the graduating students with MBA degrees. Yet, after ten years following graduation, those 3% were earning almost ten times as much money as the other 97% of graduates “put together”!
The best goals are those that are called S.M.A.R.T. goals. The requirements are these: S.M.A.R.T. goals are defined as goals that are specific, measurable, achievable, results-focused, and time-bound.
– Specific: This is What, Why and How that describe the goal you set and clearly states exactly what it is that you are intending to achieve or accomplish when you’re finished.
– Measurable: This is simply making sure that your goal can be proven successful. It means defining some sort of tangible evidence that clearly demonstrates that your goal was completed and finished.
– Achievable: They must be realistic. This doesn’t mean that your goals should be restricted to being “small”. Many people set goals that seemed almost impossible to reach, yet in the end they accomplished them. What it does mean is that you and your team must realistically have the appropriate knowledge, skills and abilities that are necessary to achieve the goal.
– Results-Focused: This one sounds the easiest, but may actually be the hardest. What it means is that your goals should measure outcomes, not activities. Often times we may hear that “the devil is in the details” and perhaps it is. Yet in successful goal setting, focus on the outcome. The activities required to achieve your goal can be defined afterwards.
– Time-Bound: A specified time frame must be established. Once again it must be realistic, but it creates a time frame and an urgency to accomplish the goal and produce a relevant outcome and result.
Have an Exit Strategy
Having an exit strategy is a must for all business owners. Although many may consider this to be a necessary component of any good business plan, it’s such an important topic that it warrants a separate discussion. It also obviously ties in closely when a pharmacy owner is setting his or her goals: What happens when I reach my goals?
The very best business plans include a sound strategy regarding exiting the business. As the profession, the economic environment, plus multiple personal situations can obviously change, your exit strategy can change right along with them. Every pharmacy business owner that plans on selling their business at some point in the future should be asking themselves several important questions. Some examples include:
– Will I be able to sell my pharmacy when I retire?
– How can I accurately project what my operation will be worth when I am ready to sell it?
– How can I improve both the worth of my pharmacy and the chances that a third-party will find my drugstore a lucrative purchase?
– What can I be doing right now to increase the value of my business when the time comes to sell?
– Would my family (perhaps a spouse and/or children) be able to run my business if something should happen to me? How do I get them prepared for such a situation?
Almost daily the news stories regarding pharmacies in the USA contain a story about a pharmacy or drugstore simply shutting down their operation and closing their doors. Perhaps proper planning, combined with a solid exit strategy, could have helped prevent some of these sad closings from happening.
Have an Objective Third-party Help You
We’ve often talked about the fact that most pharmacists may, perhaps, lack both the skill and the training that a business owner needs to have. All agree that they definitely lack the time that they need to dedicate to looking closely at all the business parameters in making decisions and adjustments to improve efficiency and profitability. So how can a pharmacy owner do a better job to improve his business?
The answer is in knowing that it is virtually impossible to look objectively at your own business and that expert help is required. Some recent business studies revealed that most successful business owners (not only pharmacies, but in every business vertical) worked with two primary outside vendors:
1. An expert accounting firm to look objectively at their financials and perform regular audits.
2. An expert consulting firm to look objectively at their operation’s work flow, efficiency and business performance.
Pharmacy owners cannot be experts in every area of business. Every pharmacy owner should consider finding an experienced and reputable pharmacy consulting firm to help them look at their operation on a regular basis. Most find that establishing such a partnership produces results that are very effective, with the benefits far outweighing the costs.
About Healthcare Consultants Pharmacy Staffing & Consulting
HCC offers pharmacy owners the support of an experienced staff who have been know the business inside and out! With over 29 years of pharmacy consulting experience, HCC has helped hundreds of business owners (pharmacists and non-pharmacists alike) get results by evaluating their business and objectively identifying operational problems, business opportunities, solutions and options. Contact us on line or call us today at 800-642-1652 for a Free Consultation to find out how we can help you too.