Less is more
Every retail group I work with is having to find ways to be more efficient and to “do more with less” and this is one of the key reasons why “working smarter” and with better data is increasingly important.
Pharmacy owners know only too well that the spending of many households in your community is finite. Not only do your customers want more for less, but they have more and more choice about where they shop.
Too much choice
In almost every retail category in pharmacies there are too many brands of products doing the same job. When faced with too many choices most customers can’t make a decision – or they just choose the cheapest product.
The approach I recommend for smarter retailing is to select a “core range” of the best-sellers in each category and restrict the number of brands to three or fewer. This makes the selection process easier for customers and staff because it helps them to make a selection using the “good-better-best” ranking process.
Benefits
Research has shown that reducing inventory assortment provides the following benefits for retailers:
· A more customer-friendly shopping environment
· Lower labour costs
· Fewer out-of-stocks
· More buying power
· Higher profit margins
By concentrating on fewer products pharmacies of all sizes can benefit from economies of scale. Larger orders of fewer SKUs (stock-keeping-units) can be handled more efficiently, and better displays of these top sellers increases sales.
Core range
We have achieved some stunning improvements in sales and profits by helping stores to focus on a core range of just 1000 OTC products. Larger pharmacies can expand on this core range by offering additional beauty ranges, gifts and fashion products too.
Once all staff become accustomed to the core range they become increasingly fluent in selling the benefits of the chosen brands.
Selection process
The process you should use to select your “core” products should be based on the following criteria:
· product efficacy and quality
· popularity
· profitability
· your relationship with the supplier
· marketing support
We have prepared a core range decision flowchart which guides buyers through the questions to ask before adding a new product to your pharmacy’s product range. Click here to download a copy: RPM Retail Core Range Decisions
Our advice is to be guided most by what your customers want and need. By curating your product range based on the effectiveness of the product and it’s nationwide sales ranking you are demonstrating that your store is truly “customer-centric”.
Learning to say “No” to some suppliers’ products is an important way to strengthen your retail pharmacy’s position as an easy place to shop for the best solutions with the best advice.
Get in touch if you would like to make your pharmacy easier to manage, more profitable, and easier for customers and staff.