Top 100 CEO Interviews
Issue No. 25 - October/November 2005
Top 100 Prescription for good business
Vigorously aging baby boomers are nothing but good news for National Pharmacies, one of the State’s biggest health sector enterprises.
The National Pharmacies group purchased four more pharmacy businesses in Victoria and opened five new optical outlets, one in Victoria and four in SA, during the past financial year.
Managing director, James Howard reports that growth was solid in the SA market; overall, sales rose by 12.4% on the same number of outlets.
Skin care and “prestige cosmetics” — brands usually found in department stores — have been growing strongly.
Market share is growing across all states and the group dispensed more than 3.5 million prescriptions last year.
“Banner branded pharmacies are a challenge (to sell), so we rely heavily on our ‘value equation for membership’, where customers can receive cheaper prices for the same goods,” James says.
“Co-payment on medicines was increased by government by 20% this year and we can pass on the benefits of purchases below $28.60.”
National Pharmacies claims a membership of more than 154,000 — more than 300,000 individuals — with growth steady at 3-4% per annum.
“Advertising is about value proposition of product and services plus membership,” James explains.
“We seek to maximise the cross-sell and up-sell by making our pharmacies larger and more comprehensive in product range and quality.
“Our premises are moving from the 150 sqm model to the 450 sq m model.”
The supplementary medicines and vitamins market is growing. People seek out preventative medicine and that sector is growing as people seek to stay healthy rather than just medicate illness.
“Our in house magazine Vital Health is more about information and education in this sector than about product selling,” James says.
“It is informative and a source of reference for many of our members.
The National Pharmacies uppe...
