The landscape of healthcare and pharmacies is evolving more rapidly than ever, setting up independent pharmacies to anchor themselves as beacons of personalized care, service, and stability in their communities. While independents certainly face their own unique set of challenges—without (and up against) the deep pockets of chains and big box stores—there appears to be a tide change in market demand for independent pharmacies. This is especially true in rural and other underserved communities. In the past decade, the number of independent pharmacies across the U.S. has grown by 5.8%, while the number of chain pharmacies has decreased by 10.3%.
There are several key drivers contributing to this state of the industry. In the early 2000’s, big box stores rushed to install pharmacies across their locations, especially in rural communities, seeing them as loss leaders to pull customers into their store. But as competition grew, especially from online pharmacies, the case for subsidizing in-store pharmacies became weaker and big box stores sought to instead fill that space with more revenue-driving products. Between 2012 and 2018, the number of pharmacists employed at big box stores dropped by 43%.
In rural communities, many of those laid off pharmacists opened their own independent stores to fill the void locally. Sometimes, independent pharmacies from neighboring towns opened a new branch. In both cases, these independents were able to step in to provide personalized care—a service that online pharmacies especially struggle to provide.
The country’s thriving pharmacies have also focused on two important measures: cost-cutting and the addition of revenue-adding services to their stores. And while margins remain tight and other pressures, like DIR fees and stringent regulations, remain, technology and automation can help independents ease the burden. The challenge there becomes assessing rising technology and trends and understanding which is right for your business.
Ahead, we’re highlighting three top trends that are shaping independent pharmacies in 2024 and setting them up to thrive for the long-term.
Expanded Clinical Services
Especially since the pandemic, pharmacy customers now expect not only prescription medications and vaccines, but much more. As you know, pharmacies are becoming destinations for every healthcare need.
This is a real positive for independent pharmacies: after all, nobody excels at community care like you do and more opportunities to provide care for your patients means more revenue opportunities. In turn, this also increases your stores’ stability for your communities. If you’re not already, consider providing the following clinical services in your stores to boost patient touch points and revenue:
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Compounding: In the past, patients would have to go to specialty pharmacies to access specialized or compound medication. As a modern independent though, you can provide this service for your patients, expanding your customer base, increasing your revenue, and increasing your ability to provide personalized care for your patients. Compounding services can also give you a competitive advantage against online and even chain pharmacies.
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Point-of-Care Testing: When you provide point-of-care testing, including blood glucose monitoring, flu and strep tests, and cholesterol screenings, you establish your independent pharmacy as a healthcare provider capable of delivering immediate diagnostics. Pharmacists can even help patients interpret test results, provide quick access to medications, offer guidance on lifestyle changes, and, if necessary, make recommendations for additional healthcare providers.
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Chronic Disease Management: In addition to testing and providing guidance for managing acute illness, independent pharmacies can also provide services helping patients manage chronic diseases, including diabetes, asthma, and hypertension. Through these services, your pharmacy can build long-term relationships with these patients and deliver crucial care as your team helps make medication and lifestyle recommendations and schedule regular check-ins and testing. These services also lead to increased patient loyalty and prescription refills.
From patient engagement platforms to VoIP communication systems, technology can help your independent provide these vital clinical services in an accessible way to your community while enabling you to increase revenue.
Telepharmacy and More Customer Convenience
Telepharmacy represents another unique opportunity to expand your pharmacy’s reach and revenue. Telepharmacy can help homebound and rural customers quickly access care and medication guidance and can also make pharmacy services more convenient for your customers, helping you “leverage technology to improve patient care outcomes.”
Mail and local delivery are also becoming more common as customers grow used to having regularly ordered items delivered to their doorstep. And whether you set up your website to make online ordering and refills easy or use a pharmacy app builder to offer your own app, customers appreciate the option to be able to order prescriptions online. You can even add other store goods—from tissues to over-the-counter medications to popular snacks—to your online pharmacy store.
Automation Technology
Year after year, burnout continues to be a pressing issue facing pharmacy teams, with staff shortages—an issue that has persisted since the COVID-19 pandemic—emerging as a top source of stress. Workload, work/life balance, challenging or unreasonable performance metrics, and high patient and prescription volumes are other top drivers.
In many ways, burnout becomes a self-defeating cycle: it can drive great talent out of your store or the industry altogether, it makes positions difficult to fill, and patients experience lower levels of service, satisfaction, and even costly mistakes that can be damaging to your business, reputation, and their health.
Addressing burnout issues within your staff takes a holistic approach; it won’t be resolved overnight. Instead, you can focus on emphasizing care for your pharmacy teams through policies that include dedicated time for breaks, lunch breaks, and paid time off. Lead by example and showcase you have a culture that cares for its employees.
Technology can also help bridge the gap. For example, inventory is the single largest investment and ongoing expense every pharmacy has. Best inventory management practices include maintaining accurate on-hand stock positions and establishing when and how much to replenish the stock to meet anticipated demand while avoiding overstock or out-of-stock situations which can negatively impact your bottom line.
Pharmacy automation technology like Datarithm®, which integrates directly into the PMS, can complete physical counts of inventory, make manual adjustments, calculate reorder points, and reduce future surpluses that may result from overstocking, expirations, and unexpected loss of demand.
With surplus inventory identified, Datarithm® makes daily, automated return to wholesaler recommendations and, for chains, intelligent store-to-store transfer recommendations. This has resulted in an average inventory reduction of 20% for pharmacies we work with, and an average 4.6 point turn improvement.
Automation technology can free teams from routine and redundant tasks, including cycle counting, inventory balancing, and medication dispensing, while saving time and pharmacy money. Then there’s automated refill reminders—a game changer for pharmacies seeking to enhance their prescription workflow. Automated refill reminders deliver timely alerts to patients when it’s time to refill prescriptions, helping greatly reduce manual reminders along with missed medications and rushed refills.
This can even free up pharmacy technicians to take workload off of pharmacists’ plates, from supporting them in medication dispensing and patient counseling coordination to medication management, whether in-store or through telepharmacy.
See the power and ease of Datarithm® in action.
By strategically employing technology and automation to cut costs, free up cash flow, and add revenue-driving services, your independent pharmacy can thrive well into the future. Through robust analytics, intuitive dashboards, and comprehensive inventory reports, Datarithm® delivers all the inventory optics that owners, managers, and pharmacists need to make more informed decisions.
