Pharmacy Growth and Expanding the Pharmacy Model
Growing your pharmacy means different things to different owners. It could be adding new patients from the nursing home nearby or increasing the number of immunizations you give each year or expanding into 340B. Additional options to expand your pharmacy model could include telemedicine, medical at home, or expanded clinical service offerings. To some it will include OTC and retail merchandising.
What does pharmacy growth or expansion mean to you?
Let’s use a scenario to illustrate what it could look like.
Owner Pat has a store in a community of about 30,000 people. There are four other independents and several chain pharmacies and grocery stores that have pharmacies within a three-mile radius of the store. Pat has been in business for seven years and has seen revenue grow and profits decline over the last few years. There is a decent sized front end that patients seem to appreciate for the couple things they need when they pick up their prescriptions. The store has a drive-thru and offers delivery. When the wholesaler bill is due or payroll needs to be run, Pat has to confirm there is enough money in the bank account, a regular stressor and constant reminder of the state of the business. Pharmacist Pat is committed to the community and the patients they serve and Owner Pat is looking for ways to move the business towards sustainability and profitability.
What would you say if Pat asked you for advice?
One train of thought could be to ask a few more questions to understand the business better to make sure we are guiding Pat correctly.
For example, two metrics would give us some indication.
One would be to know what percentage of revenue comes from dispensing and what percentage comes from other sources. This would tell us if we should focus on growing non-dispensing revenue.
The other would be to know what the annual value of a patient is to the pharmacy. This helps with two key things: the gross profit per Rx for current patients (health of the current business) and the other is to understand the impact of attracting new patients (the future of the business).
You asked Pat what percentage of the revenue is from dispensing and the answer is 94%. The remaining 6% is made up of OTC and immunizations.
Recognizing that 94% of revenue from dispensing shows that the pharmacy is too reliant on dispensing and reimbursement from the PBMs, so the focus should be on expanding the pharmacy model.
For the purpose of helping prioritize your list for Pat we have put together a word cloud from feedback we received from our members.
- Largest: immunizations, POCT, long term care, vaccines
- Middle size: 340B, medical at home, remote patient monitoring, telemedicine, DME, hearing aids, OTC
- Smaller: supplements, CBD, pet products, greeting cards, compression legwear
![Web-healthcare-expansion-such-as-techologies-innovation-staff-skills-studies-clinic-network-franchise[1] copy](https://www.ipcrx.com/wp-content/uploads/2025/04/Web-healthcare-expansion-such-as-techologies-innovation-staff-skills-studies-clinic-network-franchise1-copy.webp)
A Pharmacy Growth or Expansion Implementation Plan
Once you identify your recommended options for Pat, implementation is next. Think back to when you implemented the program for your store. What are some of the roadblocks and hurdles that you had to overcome? Did you have someone to lean on or did you do it by trial and error? If you have a well-documented process, training and project plan, share that. If not, you can lean on the resources that IPC has to offer. For example, our Pharmacy Services team has developed some important and comprehensive plans and solutions our members can lean on when they are looking to expand their pharmacy model, to become the healthcare destination for their community.
Now let’s imagine another scenario and instead Pat’s revenue breakdown shows that the store is 87% dependent on dispensing, with the same 5% from OTC and a larger amount, 8%, attributed to services and expansion of the pharmacy model.
In this case, attracting new patients would be a good strategy because it is evident that patients see the store as a destination for prescriptions, products and services. That means we need to do some marketing.
What are some marketing efforts that you have done that you would recommend for Pat? What are some things you have tried that have not worked, i.e. some pitfalls you can help avoid? Are any of them among the recommendations IPC has to offer?
Independent pharmacies looking to develop a Growth strategy to attract new patients and expand the pharmacy model have a wealth of resources to choose from when engaged with IPC as your GPO.
- Add Non-Dispensing Revenue to Existing Patients
- Immunizations, POCT, RPM, OTC
- Attract New Patients with Expanded Pharmacy Model
- Telemedicine, RPM, LTC, etc
- New Dispensing Patient Acquisition
- Marketing
Why IPC is the Right Partner to Implement Your Growth Strategy
We understand the challenges you face because IPC is led by pharmacy owners just like you with an amazing group of people looking to help you thrive as you grow your pharmacy. IPC provides the tools, resources, and support you need to build and implement a growth strategy that fits your store.
We know owning a pharmacy is hard and it is critical that you have the right partner. Take the first step to understand how IPC can deliver the right solutions to your store and your community, giving you the Freedom to Pharm.
Your Next Steps
At IPC, we are committed to empowering our member stores through defined strategies in key areas of your business.
Operational Efficiency
If you are still operating the way you did ten years ago or even two years ago, then it might be time to rethink things. Pharmacy is changing faster than ever and you need to adapt. Whether it is leveraging technology or altering a process, change can be a critical step to improving your pharmacy.
What if you could implement changes that your staff supports?
Financial Clarity
Some people have a knack for being able to read a profit and loss statement and a balance sheet. Many, however, find it hard to digest all the data to understand what it means to the health of their business. Most find it is easier to just look at their bank account.
How much more confident would you be if you understood your financial statements and how they can help you make better decisions?
Team Empowerment
You can’t do it alone and yet you’re not sure how to get your team fully engaged. Sometimes they’re excited and committed and other times they are just going through the motions. Leadership and management are skills just like any other and it’s time to shed your self-doubt.
If your team were fully engaged, leaving you with time to work “on” your business and not “in” your business, where would you focus?
Purchasing Power
Does this sound familiar? Your wholesaler rep keeps telling you to be more compliant. And you need to buy the lowest price to make sure it is less than what you’re reimbursed. And you’re shopping your wholesaler and secondaries everyday hunting for the best price.
What if you could do all three with less stress and reduce your costs?
