Having a thriving, successful pharmacy means you need to take an active approach to your pharmacy profit. Being average will not keep you in business – that’s what I always say. You need to be awesome!
To succeed in the pharmacy world, you are continuously implementing new ways of doing things, and with the ever-changing world of pharmacy, it can be hard to keep up. That’s why I put together a list of our top blog posts for each pharmacy profitability pillar. This way, you can catch up and decide what you want to focus on for the new year.
What Are The 6 Pillars Of Pharmacy Profitability?
Profitability comes down to these 6 areas in your pharmacy:
- Cash-Based Revenue
- KPI Optimization
- Non-PBM Revenue
- PBM Optimization
- Team Development
We will look at each profitability pillar and include the top three blogs from 2021. Tuck these links into your resources folder, and use them when you’re looking for new ways to increase pharmacy profitability.
Pharmacy Profit Pillar 1: Cash-Based Revenue
Improving this area will help improve profits and your cash flow, and who doesn’t like that? Not only that, but you are gaining back control over your pharmacy. You are selling what you want directly to your patients; no middleman, PBM, or doctor. Some cash-based revenue examples are supplements, POCT, PGx, medical testing, foot detox baths, and consultations.
Point of care testing (POCT) is a perfect addition to your revenue streams. Take advantage of how pharmacy testing has become the norm for many patients.
Pet medication is easy to fill, and you don’t need to invest tons of time or money in starting dispensing pet medications. Begin with the patients you have coming in already—no need to spend a ton of marketing dollars.
Boost your profits and make your patients happy and healthier by offering weight loss products and services, especially since you’ve already got a pool of patients at your fingertips.
Pharmacy Profit Pillar 2: KPI Optimization
Key Performance Indicators (KPIs) are your roadmap to becoming a more profitable pharmacy. KPI Optimization examples are inventory turns, expense ratio, gross margin percentage, non-PBM revenue ratio, and net profit.
Poor cash flow is a pharmacy owners’ number one worry – cash flow crunches happen, so be sure to educate yourself on how to get through them.
You can fast-track increasing your pharmacy profits by reducing your expenses. To thrive and be successful, optimize both revenues and expenses.
Even though the title says 2021, you can apply this blog post any time in your pharmacy. Following best practices for your taxes year-round can ensure a smoother and happier process.
Pharmacy Profit Pillar 3: Marketing
It’s a good idea to focus on marketing to achieve ultimate pharmacy growth, which is possible if you follow these strategies. Marketing examples are being consistent in your social media, sharing live videos, doctor detailing, bag stuffers, and of course, having enough budget.
Launching a pharmacy referral program will put word-of-mouth marketing on fire for your pharmacy’s growth. A referral program only costs you when it works. It can be one of the most cost-effective ways to grow your pharmacy.
In this blog post, you’ll find simple and highly effective tools for compounding pharmacies, like making a giant informative bookmark, also known as compounding pocket reference guides.
This program is a low-cost, highly effective method for increasing pharmacy growth. It can increase pharmacy growth with little time or money and create better relationships with your patients.
Pharmacy Profit Pillar 4: Non-PBM Revenue
For your pharmacy to thrive, you’ll need to break free from the PBM’s control and develop your clinical revenue and professional services. Some non-PBM revenue examples are direct bill work comp, PGx, RPM, medical billing, and clinical collaboration.
Each pharmacy has unique challenges and issues when it comes to maintaining profitability. Regardless of where you’re at in your business, it is possible to keep it consistent.
Increasing non-PBM revenue can lessen the stranglehold PBMs have on your pharmacy. You must actively search out and foster other revenue and optimization opportunities.
Remote Patient Monitoring was our top program of the year. Pharmacy staff can now perform some RPM tasks with Medicare’s new codes and clarifications.
Pharmacy Profit Pillar 5: PBM Optimization
Most pharmacies’ revenues are from a PBM, so get it organized and working for YOU rather than the PBM. A few PBM optimization examples are pricing tables, knowing your contracts, going direct, knowing the winners, and managing DIR.
Ensure you stay on the right side, keep your PBM billing fully compliant, and follow the rules. PBMs change their rules or change the interpretation of their rules quite often, so stay ahead of the game. Learn some common mistakes that pharmacy owners make and ensure you aren’t making them.
Other interested parties like research firms, payers, and clinicians are interested in your data (meeting all compliance requirements, of course). Take advantage of this opportunity.
Most independent pharmacies’ revenue comes through a PBM, so optimize your PBM-based revenue if you want to increase your profits.
Pharmacy Profit Pillar 6: Team Development
Team development is one of your most critical tasks because, as the pharmacy owner, it’s your job to build a team of high-performing employees. Several team development examples are controlling calendars, bonus programs, assessments, insurance and benefits, and empowerment.
Dealing with social issues, the pandemic, and family trials have caused staff to be more stressed-out than ever before. There is no more critical role than yours to support your employees and their well-being.
Like most business owners, we want qualified and dependable talent who shows up on time and does their best. Candidates in today’s market are looking for more than just a good salary – know the market.
Take back control of your day with these 8 time management tips from Bossingly. Reorganize your day and get more done.
If you gravitate towards one of the pharmacy profit pillars and want more content for that, just head to our blog home page and select the pillar you want to see on the right-hand side.