You’ve been working as a pharmacist in a chain drug store. While you’re making decent money, you’re tired of answering to corporate. Now, you’re considering opening a pharmacy of your own.
The only problem is: you don’t know even know where to start. That’s why you’ve arrived here. You’re looking for answers.
Fortunately, we have them. Without further ado, here is how to open a pharmacy.
How to Open a Pharmacy
There is a great deal that goes into opening a pharmacy. The most important steps to follow include the following.
One of the keys to launching a successful pharmacy is to find business mentors. These are individuals who can guide you through the startup process, helping you to minimize mistakes and maximize your chances of success.
Not only should you speak with seasoned pharmacists, but with accountants, lawyers, insurance agents, real estate agents, and other successful entrepreneurs. You’ve developed an idea of what starting a pharmacy might be. But these individuals will show you the reality of starting a pharmacy.
Construct a Plan
One of the biggest mistakes you could make is entering the startup process without an established plan in place. Having an established plan stabilizes the endeavor of starting a business, limiting mistakes and helping you to stay afloat in the face unforeseen circumstances.
A good business plan involves a wide variety of components and lays them out in great detail. Not only should it include information on the size of the pharmacy you want to open, but its location, the type of clientele it serves, and any specialization that it may possess (ie. serves geriatric patients, serves pediatric patients, etc.).
In addition, it should also possess detailed financial info. This info should include funding, financial projections, budgeting, and the like.
When creating your business plan, you’re advised to consult with your mentors regularly. They will, in all likelihood, possess experience in creating business plans themselves. And if not, they can, at the very least, help with individual components of the plan.
Choose a Business Designation
Next, you’ll have to choose a business designation. The designation you choose will affect everything from your taxes to your insurance to the licenses you need to obtain and more.
Because this choice will have such a seismic impact on the way that your business operates, you’re advised to speak about it with a business lawyer. He or she will help you review your options, determining which is most beneficial for you in the long-run. He or she will also alert you to any taxes you must pay, to any licenses you must obtain, and to any insurance policies, you must hold.
Open a Business Bank Account
When starting a business, you’re advised to open up a bank account that’s specifically catered to the business. This is important for organizational purposes as well as for tax and liability purposes.
There are a variety of business bank accounts available to you. To make sure you choose the right one, you should consider consulting with an accountant.
Now for the difficult part: obtaining funding. Simply put, opening a pharmacy is expensive. And unfortunately, because pharmacies are seen as financially risky, banks are hesitant to shell out large loans to them.
As such, you’re going to have to obtain a great deal of your funding from other sources. The question is: what sources?
One option would be to find a business partner or partners. By opening the business with a partner, you will be able to pool your money. You won’t get as much of the profit from the business, but you will face less financial risk.
Another option is to ask around to family and friends. It might be possible to obtain enough funding through small contributions.
The last option is to obtain all of the funding yourself, either through direct savings or through credit cards and personal loans. This is extremely financially risky but would allow you to get the business started.
Find a Store
Once you’ve obtained funding, you’ll need to find a store. While there are undoubtedly a number of vacant buildings available to you, the key is in choosing the right one. Choosing the wrong building can greatly affect the size of your customer base, drastically reducing your overall profit.
This is a huge decision. As such, when making it, you’re advised to consult with geographical analysts. Using sophisticated software, they can pinpoint a location that aligns with the services of your pharmacy.
Buy Equipment and Inventory
Next, you’ll have to stock the store. To do so, you’ll need to buy both equipment and inventory. Not only will you need to order a surplus of pills and medications at discounted prices but you’ll also need to invest in equipment that can preserve those pills and medications.
Some of the equipment you’ll need includes a vaccine refrigerator, a counting machine, and syringes. Of course, these are only the tip of the iceberg.
You can’t run a pharmacy on your own. You will need employees, some of whom will be fellow pharmacists and some of whom will be pharmacy technicians.
It shouldn’t be too difficult to find employees. Post openings on job boards and wait for the applications to roll in. Then, perform interviews and choose the employees you’re most comfortable with.
Once you’ve established your employee base, you’ll be ready to launch. Market your pharmacy like crazy and open the doors to the public!
How Much Does it Cost to Open a Pharmacy?
As you might expect, starting a pharmacy is far from cheap. Costs can vary wildly based on the geographical location and nature of the store. But regardless of the type of pharmacy you open, it’s going to be a seismic investment.
At a minimum, you can expect to pay over $250,000. At a maximum, you could pay up to $2 million, the average range is $350,000 to $550,000.
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