The Apothecary Shoppe is an efficient, well-run pharmacy operating in metropolitan Salt Lake City, Utah. Owner Kevin Demass is an astute business man and pharmacist eager for information and always proactive in the operation of his business. Kevin has participated in Good Neighbor Pharmacy Business Coaching since 2010.
Early on in the Business Coaching process, Kevin recalls his coach pointing out that a significant portion of his business came from a small group of physicians located in a clinic upstairs from the pharmacy. At the time, he was confident that he had a good relationship with the providers in the clinic and the thought of losing them seemed a remote and unlikely possibility. But that possibility became a reality toward the end of 2011 and into 2012 when the clinic decided to move and open an in-house pharmacy. As a result, The Apothecary Shoppe began experiencing a slow but steady decline in volume, which would result in about a 30% loss of business over the course of more than 12 months.
This new business isn’t coming from the hospital next door. I had already tapped that business. I had to go outside of my comfort zone and talk with prescribers who didn’t know me or my pharmacy well. I had to work to get this new business.
With the help of his business coach, Kevin identified key prescribers and made a commitment to begin marketing directly to prescribers and their staff. However, as he saw his prescription volume decreasing, he was also concerned about his labor costs. Fortunately, Kevin and his coach had evaluated his labor costs and productivity shortly before volume began to decrease. Through that process, they had determined that Kevin’s productivity ratios were good and his labor costs were well controlled—indicative of an efficient, well-scheduled staff. Kevin was able to work with his business coach to make small changes in the schedule, minimize disruptions to his staff and keep most of his long-time employees.
Over time, Kevin was able to regrow most of his business, increasing his volume by nearly 34%. “This change didn’t happen overnight. What I’m seeing now is the result of more than three years of work. I take my day off each week and I go claw my way back, taking the time to build the relationships and the trust with these practices.” His efforts to proactively market his pharmacy to targeted prescribers resulted in significant growth for The Apothecary Shoppe. His current top three prescribers, who once represented 1.3% of the total script volume, now represent 16.4% of the pharmacy’s total script volume and 61% of The Apothecary Shoppe’s new business growth.
Kevin finds himself again on the verge of change as top prescribers move or retire, and the makeup of prescribing habits change. But the last few years have left him better prepared, and he has built up his business by spreading his prescription volume among many prescribers rather than focusing on just a few. Recouping his lost business and protecting his margins have been his focal point for the last few years. Kevin has shifted his efforts to cornering a more moderate segment of the business with less of a tendency to prescribe expensive specialty drugs. He now looks to his coach to help him be even more strategic in his efforts to protect and grow his business.