Worked scenario
The front of the shop earns more than the dispensary
Where margin is regulated, the commercial decisions that remain are the ones nobody is analysing.
3 min read
In a pharmacy, a large share of turnover comes through lines whose margin is not really a decision. What is left — personal care, nutrition, devices, general goods — is where the pharmacy's own commercial judgement operates.
Stocked by inheritance
The general aisle in most pharmacies reflects decisions made over years, few of them revisited. Lines persist because they are there. Space is allocated by history rather than by return.
Two numbers change the aisle
Movement per line over ninety days, and margin per line. Together they sort the aisle into four groups, and only one of them — slow and low-margin — is unambiguously wrong to keep.
That is a short list, usually a couple of dozen lines, and clearing it releases both space and cash.
Why it is worth doing before anything ambitious
Because it costs nothing, uses data already being captured at the till, and funds itself. Pharmacies looking to expand often need working capital that is already sitting on the third shelf.
What changes
- Margin visible by category, separating dispensary from general lines
- Slow-moving general stock identified before it ties up working capital
- Space allocated by what earns rather than by what has always been there
- Purchase concentrated on lines with demonstrated movement
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