Front-End Mix Allows Pharmacies to Control Costs, Boost Bottom Line

Stock shelves with boutique and unique products to anchor existing customer, attract new ones.

Local community pharmacies appreciate their customer bases and are good at showing it. “No single pharmacy chain has more stores than all independents combined, which represent 35% of all retail pharmacies in the US and a $73.7 billion marketplace. At the end of the first quarter of 2020, there were 21,683 independent community pharmacies in the United States,” according to Hamacher Resource Group.1

In other words, communities value a personal touch and shopping locally. They also have come to rely on the products, quality care, and support that local community pharmacies provide.

Challenges and Solutions

It is no secret that pharmacies face many challenges. Unpredictable bigger-store systems, direct and indirect remuneration fees, payer clawbacks, reimbursements, and sometimes a lack of qualified employees can negatively affect a pharmacy’s bottom line. These issues take a pharmacy’s focus away from what often matters most: providing customer service. By having a patient-first approach and providing a unique mix of products in a pharmacy’s front end that help drive foot traffic, customers will have many reasons to choose a smaller, independent community pharmacy over the competition. To be clear, the front-end mix is the simplest way to control costs and increase a pharmacy storefront’s bottom line.

“The one place in your pharmacy where you have complete control of product mix, merchandising, pricing, and appearance is your front end. Regardless of the size of your front end, it [must] contribute to your bottom line,” according to the National Community Pharmacists Association (NCPA).2

Finding that balance between running a successful pharmacy and a profitable front-end retail space may be the difference between a thriving community pharmacy and one that is struggling to compete. That is why meeting customers’ needs is vital to a community pharmacy’s success. Most pharmacies understand that dispensing prescriptions and being on a first-name basis with patients is not enough to keep customers returning. Providing quality prescription care is just 1 com ponent of the economic equation. Providing vital clinical needs, such as vaccine services, while creating a unique front-end shopping experience are ways independent pharmacies can separate themselves and diversify their revenue streams.

With consumer needs often in constant flux, striking the right balance of health, lifestyle, and wellness products for existing and new customers is vital. Trends are trends for a reason, and maintaining the changing seasonal merchandising selections offered by sophisticated retail operators can be a challenge to duplicate. Some independent pharmacies have the staffing capacity to assist with both the front-end and pharmacy sides of customer service, whereas others must wear many hats, often leaving personalized customer service in the balance. However, there are great ways to ensure that a pharmacy meets the growing demands of its consumer base.

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