A significant growth opportunity for independent pharmacy may be in its sales of over-the-counter products, according to a recent white paper published by the Hamacher Resource Group. Patient access to pharmacists and their product recommendations contribute to improved OTC performance within independent pharmacy, the report noted.
Using first aid as an example, first aid bandages remained a strong category in chain pharmacy, however first aid treatments — antibiotics, skin treatments, wound cleansers and antiseptics — were stronger across independents. In 2011, independent drug stores also saw higher sales growth than chains in the first aid, eye/ear care, sun care, smoking deterrent, foot care and incontinence/home health care/diabetes categories."The story that unfolds indicates that consumers tend to favor independent community pharmacies for medicinal or clinical-type purchases, but chain pharmacies for healthcare items that might be considered more mass market," the paper read.
According to the report, sales of treatment-focused OTC products represented a larger percentage of category sales within independent pharmacy, and increases in market basket can be attributed to companion product sales and category adjacencies.
U.S. retail pharmacy sales (i.e. prescription drug business) at independents rose 2.5% to $44.70 billion in 2010, compared with a 1.3% increase to $106.58 billion by chain drug stores, according to data from IMS Health and the National Association of Chain Drug Stores.
Overall independent pharmacy sales volume was up 4.8% to $79 billion last year, versus a 5.4% gain to $238.31 billion by chain drug retailers, according to research by Racher Press Inc., publisher of Chain Drug Review.
The study has "highlighted the importance of independent pharmacies and the growth potential of OTC remedies and certain categories at these retailers," stated HRG VP Dave Wendland. "Combining disciplined merchandising tactics and strategic store layout with ongoing pharmacist education will continue to drive growth in this channel."[Source: “Growth Drivers: The Factors Behind Independent Pharmacy OTC Sales.” Hamacher Resource Group, with the support of the Healthcare Distribution Management Association and the Consumer Healthcare Products Association. 14 June 2012. Web. 13 July 2012.]