Buying a pharmacy is not as easy as it once was
As someone fortunate enough to have retired relatively wealthy from self-employment within community pharmacy some 20 years ago, and having made even more from investment since, I found the article written by Sean Dixon on buying a pharmacy (The Pharmaceutical Journal 2015;294:531) interesting, particularly in his breakdown of the main annual revenue available from the sector.
He describes an idealistic situation relating to most peoples’ concept of local banking within the high street today, which I no longer recognise. Bank managers who had some idea of retail business, able to understand a proposition for a loan and to make the necessary decisions seem no longer to exist in my local branch of Lloyds. Rather, the place appears nowadays to be more like an understaffed shop hard-selling pre-packed financial products by people with little training and no concept of finance.
No matter, with the present resale value of any pharmacy with an attractive turnover, the stake needed, even to justify a loan to buy the same, is going to be beyond the reach of most pharmacists.
I was on the Council of the old Royal Pharmaceutical Society during the mid-1980s when David Sharpe, a member of Council and chairman of the Pharmaceutical Services Negotiating Committee, first muted the concept of negotiating some form of limitation of entry into pharmacy contract at a time when there was no security in the retail sector due to “leapfrogging” (opening a pharmacy closer to a doctor’s surgery than the nearest pharmacy). This limitation came to be, with the “desirable and necessary” criteria being introduced — which exist to this day — and the barriers to entry which Dixon described were born. Little did any of us realise at the time just how much this provision would elevate the goodwill being asked for businesses at the point of sale.
Citation: The Pharmaceutical Journal DOI: 10.1211/PJ.2015.20068543
Recommended from Pharmaceutical Press