The Retail Scientist Blog

The Retail Scientist Blog

Good News Ahead

May 31, 2024 | Articles

There is no doubt that the last four years have been the most difficult in New Zealand Pharmacy history. The disruptive forces have included the Covid lockdowns, the chaos caused by emailed prescriptions, the loss of experienced staff from the sector, the spread of discount pharmacies, a primary health sector in disarray, a shortage of qualified staff, rampant wage increases, and the inflationary economy.

These pressures have resulted in a significant decline in pharmacy profits, and there will undoubtedly be more pharmacy closures ahead. But for many pharmacy owners the worst appears to be over.

Green shoots

As I travel around the country I am seeing the green shoots of more positive times ahead for most pharmacies, particularly the ones that have managed to retain staff, kept service levels and margins high, and continued to invest in their business.

At long last pharmacy owners and key staff are finding that they have adapted to the “new normal” and they are feeling that their business is entering a period of relative stability.


I am confident that there will be more funded services coming pharmacy’s way in order provide relief for under-stress GPs and hospitals.

It has always been true that the businesses that seize opportunities during difficult times are the ones that emerge as the biggest winners when better times arrive.

Pharmacies with an appetite for growth are investing in three key areas of change which are going to be the key for successful pharmacies of the future.

1. Bigger, more efficient dispensaries

Most dispensaries have received little or no investment in workstations, benches and shelving for many years – but the nature of dispensing has changed dramatically.

The change to the flow of incoming scripts and the increased use of dispensary automation means that the subsequent steps in the dispensing process are new and different too.

There is a greater requirement for staging of work-in-progress due to the complexity of many patients’ medications, and there has been a massive increase in space needed for storage of finished scripts.

Many busy dispensaries now have a separate dispensary dedicated to unit-dose packing of prescriptions too.

2. Growth in health services

Providing new services that your competitors can’t (or won’t) offer creates compelling reasons for customers to choose your pharmacy. The growth in services like vaccinations and health consultations accentuates the trusted, personal relationship that local pharmacists have with their community.

The most effective way to satisfy this growing demand for instore services is to ensure that there are dedicated, private and semi-private consulting workspaces with sufficient triage and waiting areas.

Pharmacies that have been getting by with one consulting room are now finding that three rooms are needed at peak times.

3. Rethinking the shop

As a result of bigger dispensaries and the growth in services, the layout and space utilisation of retail areas in many pharmacies is changing too.

Gone are the franchise cosmetic wall units, along with many of the stands containing non-core ranges such as jewellery, clothing, fragrance, footwear, toys and gifts.

The re-emphasis on community pharmacies as a healthcare destination has accelerated the need for range rationalisation in the shop and means that health-trained staff (e.g. nurses and naturopaths) are a must-have.

Instead of following the discounters and stocking a wider range of toiletries and consumer goods, the top-performing pharmacies are embracing their new, specialist role as the most easily accessible health consultants.

Time to change

Doing what you have always done the way you have always done it is no longer a recipe for survival.

Re-designing these three key parts of your pharmacy is no longer nice-to-do, it is imperative if you want to succeed as a community pharmacy.

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