Dramatically improve your independent pharmacy’s profits and sleep better at night with the power of Monthly Recurring Revenue.
Three little letters that can change your pharmacy profits and how well you sleep at night: MRR. Monthly Recurring Revenue (MRR) Memberships are ideal for pharmacy owners who want to generate stable and predictable income streams and grow their profits.
Independent pharmacy owners often face fluctuating profits from month to month. This variability comes from random DIR fees, changing COGS, changing OTC purchases, and 1,000 other reasons (we could probably write a book on them!). Dealing with these inconsistencies can cause financial planning chaos. You might have found yourself asking, how can I create more stability in my pharmacy?
Monthly Recurring Revenue through memberships.
As an independent pharmacy owner, you’ve likely heard of Memberships. Memberships of all types are all around us, from Netflix to your local gym to Amazon Prime. However, it might be a new concept to apply in a pharmacy.
Let’s start by clarifying MRR memberships and how to use them to bring stability and predictability to your pharmacy’s revenue stream.
The Basics of a Membership
First, MRR is a subscription service payment model where customers pay a set monthly amount to gain access to certain benefits or services.
The endless possibilities range from cash discount programs to wellness solution bundles, point-of-care testing, and discounts on over-the-counter (OTC) products and supplements. You can go ultra-low of $5 a month to ultra-high of $500. It all depends on the package you put together. The only limit is your imagination.
MRR memberships are a powerful way to create a loyal customer base that allows you to say goodbye to the unpredictable ups and downs of running an independent pharmacy and hello to financial stability.
Benefits of a Membership for Your Independent Pharmacy
Let’s explore the benefits of MRR memberships and how you can tailor them to meet your pharmacy’s and patients’ unique needs.
The Benefits of Monthly Recurring Revenue (MRR) Memberships include:
- Financial Stability: MRR memberships provide a stable income source, reducing the impact of revenue fluctuations on your pharmacy’s bottom line. This stability allows you to plan and invest in the growth of your business confidently.
- Customer Loyalty: Memberships foster long-term relationships with your customers. They are more likely to choose your pharmacy for their healthcare needs when they are members, leading to increased customer loyalty.
- Predictable Cash Flow: With monthly subscription fees, you can predict your cash flow more accurately. This helps with inventory management, staffing decisions, and overall financial planning.
- Competitive Advantage: Offering memberships sets your pharmacy apart from competitors. It demonstrates your commitment to providing value and personalized services, attracting new customers, and retaining existing ones.
- Community Engagement: Membership programs can strengthen your pharmacy’s ties to the community. Regular interactions with members create a sense of belonging and trust.
- Health Outcomes: Some membership offerings, like wellness bundles and medication management, can improve your customers’ health outcomes. This not only benefits them but also enhances your pharmacy’s reputation.
- U&C Clauses: PBMs require you to bill them the lowest U&C (usual and customary) price for each NDC. By creating a paid membership, you can offer low cash prices to your members, and they don’t interfere with your set U&C prices.
Now that you know the benefits of Monthly Recurring Revenue (MRR) Memberships, let’s explore some simple and clear ways to execute your membership offerings.
Ideas For Your Pharmacy Membership
Cash Discount Programs
One popular membership option is a cash discount program. Cash discount programs offer an attractive incentive for customers to join your pharmacy’s membership. These programs can also extend to other products and services, like consultations or wellness check-ups. By saving members money while offering a continuous stream of revenue for your pharmacy, cash discount programs serve as a win-win situation for both parties involved. You don’t need to reinvent the wheel here. Go ahead and model after popular big-brand discount plans or cost-plus options.
Wellness Solution Bundles
Consider offering wellness solution bundles as part of your membership program. These bundles can include services like health screenings, consultations with pharmacists, and personalized wellness plans. Members receive regular check-ups and guidance to improve their health, creating long-term relationships with your pharmacy. These bundles offer a comprehensive health solution that fosters a deeper, more committed relationship between your pharmacy and its members.
Here are some specific problems you can tackle with a solution bundle:
- Weight loss
- Adrenal fatigue
- Blood sugar
Did we hear you want an example? Alright, here you go. Here’s a weight loss example of bundling solutions to fix a problem.
- CGM monitor
- ZRT weight loss panel
- 3 individual consultations
- 15% discount on OTC supplements
- Local dining-out guide
- Access to your private Facebook group for weight loss patients
- Cost-plus model on any Rx weight loss options
A possible price for something like this is $199 monthly for 6 months. If that is too scary to jump into first. Start small with a private Facebook group for only $9 a month.
Point of Care Testing
Point-of-care testing services enable members to conduct routine tests at your pharmacy at discounted rates. Quick tests for diabetes, cholesterol, and infectious diseases are usually included, and members receive immediate results. This adds value to your membership program by making essential healthcare services more convenient and affordable, ultimately contributing to the well-being of your members. If you do POCT, this is a great add-on for any membership you offer, as the patient’s perceived value of the service is extremely high while your actual cost is pretty low.
Discounts on OTCs and Supplements
Offer members exclusive discounts on over-the-counter products and supplements. Many customers rely on these items regularly, and a membership that provides ongoing savings can be a compelling proposition. This encourages members to shop at your pharmacy for their everyday needs. Such discounts offer a financial advantage for members who regularly purchase these items, encouraging them to keep their business with your pharmacy and leading to more consistent profit.
Personalized Medication Management
Create memberships that focus on personalized medication management. Your independent pharmacy can work closely with members to manage their medications effectively. Boost it up by pairing this with PGx testing. This customized service helps to identify optimal drug regimens, minimize potential side effects, and monitor the effectiveness of treatments. Offering this level of detailed, personalized care can set your pharmacy apart from competitors and build deeper relationships with members.
Chronic Disease Management
Customers with chronic conditions often require ongoing care and attention. Comprehensive disease management services, such as regular health monitoring and medication adherence support, can significantly enhance their quality of life. Lifestyle guidance can also be provided, allowing your pharmacy to serve as a comprehensive healthcare partner for those in need.
Pharmacies have been giving away additional services for free for far too long. While there can be a good business use case for free, boost your profits and differentiate yourself further from the competition by highlighting your extra services and bundling them together. Here are some ideas for a concierge-level membership:
- Prior Authorizations
- Therapy Optimization
To cater to a broader audience, implement different membership tiers. Multiple membership tiers enable your pharmacy to cater to a diverse audience with varying needs and budgets. For example, a basic tier could offer medication discounts, while a premium tier could include extensive wellness services. The tiered system allows flexibility, making it easier for potential members to find a package that suits them.
Extend your membership program to cover families. Family memberships are a logical extension of individual plans, allowing entire households to benefit from your services. This option often provides even more value for money, encouraging families to opt for memberships together. It boosts your member numbers and contributes to a stronger sense of loyalty among a wider customer base.
Offer Automatic Renewals and Billing
Ensure your membership program offers automatic renewals and billing. Automatic renewals and billing make it convenient for members to continue benefiting from your services without hassle. The automatic nature of these transactions ensures a consistent revenue stream for your pharmacy and makes it easier for patients to manage their membership. We highly recommend setting your memberships up with Stripe. It seamlessly executes subscriptions.
Customization is Key
The beauty of MRR memberships lies in their adaptability. Tailoring your membership programs to fit these unique characteristics can drastically improve the success and impact of your offerings. This customization ensures that your memberships not only transform your pharmacy’s financial outlook but also meet the specific healthcare needs of your community.
By focusing on these key areas, you can create a robust and attractive membership program that benefits your patients and profits. If you need additional assistance executing MMR memberships in your pharmacy, consider joining Pharmacy Badass University for support and resources for you and your team.