Ready to set up a pharmacy practice? Here’s what you need...
The traditional chemist's shop is part of every high street.
Everybody needs to drop in to pick up prescriptions and the necessities of life. A growing interest in health means increasing demand for supplements, diet aids and more, while beauty provides an apparently limitless market.
It means that opening your own pharmacy is more than simply a place to use your pharmaceutical skills - it could be a very rewarding business.
Unfortunately, the details of running a chemist shop, and the best way to arrange the finances required, are not part of the pharmacy undergraduate syllabus. As a result, many pharmacists simply don’t know the earning potential of pharmacy ownership - or the challenges.
And of course, there are challenges. There are the big chains and franchises as competitors, and before you to bring in customers you will need to make some substantial investments. But a first-time pharmacy owner can still make a profit.
Do your research
You need to start with your research. Look at the market, purchase costs and ongoing costs, and learn how to write business plans. Most of this information can be found by talking to your professional advisers - accountants, solicitors or transfer agents.
Look at location. Many first-time buyers want to buy a pharmacy on their doorstep, but you might have to wait years until an opportunity comes along. Look at the premises. Is there the room you need for retail? Remember, the more retail space, the more profit your chemist's shop will generate. You can make a living out of pharmacy alone, but to make real profits, you need to sell the extras your customers need, from diet drinks and corn plasters to cosmetics.
Look for a business where you can add value, through refurbishing or by bringing in automation. However, you will also need to look at the costs of setting up carefully.
What funding do you need for your pharmacy?
There are several different costs to look at. Buying an existing pharmacy will bring you a functioning business that could be generating profits from day one - but costs will be high if the business really is making money. Setting up your own practice will mean a different set of costs altogether.
There will be premises to pay for - and, unfortunately, the bigger and better they are, the more you will need to pay.
You will need a location where patients can easily reach you with their prescriptions, because not all your customers will have access to a car, and where retail customers are already passing. A high street location with public transport available might be best.
The next step will be to fit them out, with retail and display equipment as well as setting up your pharmacy area. Getting the right layout and equipment in your pharmacy, along with a modern look, is often high on the list of priorities of many pharmacy owners.
You’ll also potentially need funding to cover the lease on the building you're looking to use - although in future you might want to consider buying your premises with a Commercial Mortgage.
You need to invest in a growing list of technology to deliver a modern pharmacy service. Even if you don’t use a dispensing robot, you will still need scales and secure storage. On top of this, you will need retail display and lighting and you may need a vehicle if you are operating a mobile service, delivering to care homes or individual clients.
At Rangewell, we can help you spread the cost of used as well as new equipment with Asset Finance. Basic equipment that will go on giving service for years can be financed with Hire Purchase to spread the cost. And if you need to avoid upfront costs, leasing will give you the freedom and flexibility you need.
Staff and operating costs
You’ll also have staff and operating costs to provide for. Unless you have bought a business that is already thriving, simply opening the door will not bring in that footfall you need. You are likely to also need working capital until your shop has enough custom to start generating a profit. Working Capital Finance is designed to give you additional working capital, to provide cash to pay staff and suppliers - remember, you may need £thousands worth of retail stock - during the early weeks and months of opening your shop. It is designed to be repaid in the short- to medium-term.
Setting up a pharmacy business from scratch could cost £200,000, or substantially more if you need to buy premises.
It is a large sum of money, but it may be possible to borrow the funding you need. We can show you all the options for business acquisition and for start-up funding, and specialised solutions to cut the cost of borrowing you need.
Get professional help with your pharmacy
Clearly, most people will need to borrow the money they need to set up a pharmacy business. Many lenders will lend to the sector - but getting the deal that your business really needs from the right supplier may make a big difference to your repayments.
At Rangewell, we work with every UK lender and have access to more than 23,000 business finance products - and expert advisors who understand the challenges of setting up and running a chemist shop practice. We can help you find the funding that your pharmacy needs and our services are free - so if you’re looking for a way to support your plans, find out more about how you can get the most appropriate funding for your needs or even apply today. Why not also take a look at our Pharmacists' Directory which can help professional pharmacists find support from pharmacy marketers, lawyers, values and even specialist advisors for pharmacists.