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Business Plan for a Pharmaceutical Retail Company
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Business Plan for a Pharmaceutical Retail Company
SWOT Analysis
Strengths. Alima Pharmacy’s greatest strength is the wide collection of prescription and over-the-counter drugs from leading manufacturers in the United States and selected countries. The company seeks to create a strong brand reputation as a one-stop-shop for different types of medications. All products sold by Alima Pharmacy can be picked directly from the pharmacy’s retail stores by walk-in customers or be delivered by mail order. The company strives to scale up the mail delivery side of its business and to reduce its prices so as to attract more customers and increase sales. The second strength is excellent staff that is highly trained in product knowledge and customer service. The company believes that customer service excellence provides opportunities for business growth (Srivastava, Bartol & Locke, 2006; Watkins, 2009). In this regard, the company endeavors to offer regular training and development opportunities to make its employees more competent. Opportunities for training and development will be offered both internally and externally.
The third strength is excellent relationships with local physicians and hospitals. Alima Pharmacy believes in strategic partnering as an important business strategy with potentials to facilitate rapid business growth. The company has established extensive mutually-benefiting collaboration with physicians and general practitioners to get referrals.

To make these partnerships more benefiting, the company is seeking to build a positive reputation as a provider of high quality and safe medications in the local market. Strength is that the company offers specialized medical services targeting specific consumer groups. These include customers with chronic health complications, the elderly, and those in need of preventive care. There is a huge population of elderly people that Alima Pharmacy will target through innovative marketing strategies. Other targeted groups include customers with fertility problems, and those requiring travel vaccines. The company’s strategic location is also an important aspect of its strengths. Alima’s retail store is located on a busy street in an area that is frequented by hundreds of shoppers daily. The street is well known because of a large number of pharmaceutical companies located there. Also, there are hospitals and health consultants within the vicinity. All these will help Alima to establish its brand within a very short time.
Weaknesses. The greatest weakness facing Alima Pharmacy is the lack of strong brand equity and visibility because it is a start-up company. Alima Pharmacy is a newly formed company and will, therefore, need more time to establish its brand in the market. While it endeavors to undertake an aggressive marketing strategy, it may need up to a year or more to develop the necessary capacity to overcome competitive pressures from established industry players especially hospitals and large pharmaceutical companies operating in its vicinity (Watkins, 2009). Moreover, since the majority of Alima Pharmacy’s target consumers are not aware of its existence, they might be skeptical of the quality of its products and services. The company will conduct extensive marketing campaigns aimed at informing the public and its potential customers about the benefits of its products. The second weakness is a lack of experience in operating a running a pharmacy. The founders have never been involved in pharmacy business and will, therefore, rely on the skills of their management team to drive the company’s strategic agenda. As such, there are uncertainties regarding whether the company will be able to achieve its objectives as envisaged in the marketing plan.
Third, the company is uncertain of the best strategy for estimating demand for its products. Like many other industries, the pharmaceutical industry is affected by the change in economic indicators. Adverse changes in the economy can cause a major impact on the level of demand for Alima’s products. Since the company is new in the market, it will have considerable difficulties determining optimal demand. This may cause the company to incur high inventory costs, which will drive profits down. Lastly, the concentration of pharmacies within Alima’s location means that the company will have difficulties developing strong differentiating strategies.
Opportunities. The greatest opportunity is that Alima pharmacy is located in a community with a large population of middle-aged and elderly people. Most of these people are known to suffer from chronic health complications and require frequent medications. Alima will develop tailored communications to target these people. The second opportunity is that there are several physicians in the area who are willing to work with Alima Pharmacy to advance the objective of enhanced service delivery in the health care industry. Alima Pharmacy will seek to cultivate strong strategic partnerships with more physicians for business development (Krafft & Mantrala, 2006).
There are also opportunities for Alima pharmacy to form strategic alliances with suppliers and other stakeholders in the pharmaceutical supply chain. Since Alima buys in large quantities, establishing alliances with suppliers will lead to huge price discounts, which will be passed down to customers regarding reduced product prices. As already noted, competitive pricing is the hallmark of Alima Pharmacy’s differentiation strategies. The company can also form alliances with insurance companies to get more customers. The constant growth in the number of patients requiring specialized medication presents opportunities for Alima Pharmacy to establish a business unit dedicated to serving this group of customers. Further opportunities for Alima pharmacy lie in the international markets. Although the company is currently operating in the domestic market, increasing the saturation of the market requires company look beyond national borders to increase its sales. Emerging markets such as Brazil, China and India present good opportunities for foreign investment in the pharmaceutical industry.
Threats. The greatest threat facing Alima Pharmacy is the entry of established companies into the retail order market. There are at least six pharmaceutical companies offering services related to the delivery of drugs through the mail within Alima’s vicinity. These retailers present strong competitive pressures to Alima pharmacy. The fact that majority of these competitors are well established means that Alima will have to reevaluate its marketing strategies. Another major threat is stringent regulation of pharmaceutical business. The industry is highly regulated due to the high degree of risks posed by counterfeit and low-quality drugs. Also, macroeconomic challenges present a tough business environment especially for small and start-up up firms (Stark, 2006). Lastly, consumer purchasing behaviors are highly unpredictable. Thus, there is a possibility for the company to miss its sales targets if consumer behaviors change adversely.
Reflection on SWOT Analysis
The above SWOT factors will have a major impact on the branding and operations of Alima pharmacy. This is especially the case because Alima is a start-up business operating in a strongly competitive industry. The intense competition in the market is the single greatest factor affecting Alima’s branding. There are tens of established and well-known pharmaceutical brands operating within a one-kilometer radius of Alima’s location. To overcome this level of competition, Alima will have to pursue strong differentiation strategies. Differentiation will help the company to attract more customers and build a strong brand. The company remains optimistic that the market demand for its services and products will be great. The company’s management team is convinced that an integrated marketing strategy will be crucial for the businesses to thrive in the competitive industry.
Assessment of Key Consumer Trends in the Pharmaceutical Industry
The pharmaceutical industry has undergone major transformations that have impacted the way drug pharmacists interact with their consumers. One of the most important trends in the industry is the increasing tendency by consumers to use technological applications to monitor their health and source medications (Shane, 2012). There is a wide range of digital applications that allow patients to monitor health symptom without necessary seeking the services of physicians. This trend means that Alima Pharmacy must develop competencies in digital marketing and distribution of its products. Also, the company should be prepared to deal with customers who need prescription drugs without the need for a referral from physicians.
Another key trend is patient centricity. Today’s pharmaceutical consumers are more informed about the medications they require, thanks to a large amount of information that can be easily accessed from online depositories and other sources. Pharmaceuticals have to adjust to this new trend and realize that consumer’s experience matters (Shane, 2012). To survive this trend, Alima Pharmacy will have to develop a patient-centered marketing approach based on the understanding of consumers’ needs, delivery of the right products and services, and strategic customer relations. Also, the company will have to involve its customers in decisions about what products to stock. This involvement will reduce costs and lead to greater efficiencies in service delivery.
Impact of Ethical Violations on Branding and Success of Alima Pharmacy
Ethical violation refers to any business practices that are morally unacceptable. Examples of these practices by pharmaceuticals include giving wrong, expired or poor quality medications, the disclosure of patient’s information, unprofessional conduct and price exaggeration. Ethical violations affect branding and business success through loss of goodwill. Businesses that operate unethically endanger the public and therefore will not get enough customers. In most cases, such businesses have to deal with a negative reputation, which is a costly burden to any business. According to Snyman and Kruger (2004), if unethical practices become too prevalent in an organization, everyone in that business environment becomes at risk. For example, if a drugs retailer fails to follow ethical guidelines when procuring drugs, he may stock wrong medications, which put patients’ lives at risk. This may lead to legal actions by the regulatory agencies, which may eventually lead to the closure of business. Ethical violations may also lead to loss of talented workers as employees may not want to be associated with an unethical employer. Being a small business, Alima Pharmacy will not engage in any practice that may lead to loss of reputation. The company endeavors to remain uncompromising in matters relating to fairness, honesty, and quality of medications.
Core Competencies
Leading and managing a newly established pharmaceutical business requires various competencies to address inherent challenges such as changes in market trends and customer preferences. New technologies, entry of new market entrants and the influx of new patients have significantly changed the way medical sellers operate, requiring review of skills to remain competitive. One way to remain competitive is by embracing core competencies in major areas of business operations. Core competencies are the strategic advantages, capabilities, and strengths that enable an organization to remain competitive in the market. The following are the main core competencies associated with Alima Pharmacy:
Professional practice: Alima Pharmacy endeavors to promote optimal health outcomes for its customers. The company takes into consideration the fact that the role of pharmacists in health care has changed significantly over the past few years, particularly with the expansion of the pharmacist scope of practice. As experts in drug therapy, Alima Pharmacy will develop the skills and knowledge of its employees to enable them to undertake the expanded scope of the company’s activities.
Holistic thinking and collaborations: as coordinated delivery becomes the norm in health care (particularly in medical distribution), collaborations among stakeholders are paramount (Knapp, Okamoto & Black, 2005). Change in market conditions require pharmacists to do more with less but still provide high-quality services. For example, increasing demand for high quality and low-cost medications is pushing pharmacists to reconfigure their business models, processes, facilities and people involved in different services across the organization. In this regard, Alima Pharmacy has adopted the approach of holistic thinking and collaborations as one of its core competencies and a source of competitive advantages. To ensure that this core competence is not easily emulated by competitors, Alima will embrace goal setting and strategic planning as the guiding principles in its collaborative efforts.
Data analytics: the ability to analyze huge quantities of data to drive efficiency, quality, and safety is a major core competency for Alima Pharmacy. The company strives to move beyond merely storing data to analyzing it to understand trends, identify problem areas, and pinpoint opportunities for cost sharing. At all levels, the company’s employees will be required to engage in discussions using data to make informed decisions (Ireland, Hoskisson & Hitt, 2008). This requires the company to invest in the analytical skill sets of its employees. Accordingly, Alima will offer appropriate training opportunities to make its employees feel more comfortable with data and information.
Change management: closely related to data analytics is the ability to make quick decisions in a rapidly changing business environment. Alima Pharmacy seeks to create a strong management team that is capable of reacting to market demands quickly. In effect, the company will implement several change management strategies to ensure that any opportunity in the market results in profits for the enterprise.
Lean business entity with a small but highly efficient workforce: Alima Pharmacy’s operations are based on a fable business model (without actual production facilities). The company will source all its products directly from manufacturers as a way of reducing costs. The company seeks to grow into a professional specialty medical distributor within its location (Snyman & Kruger, 2004). The company’s management team has extensive experience and track record in the marketing and sale of various pharmaceutical products and services. By ensuring high sales revenue at low cost, Alima pharmacy’s main goal is to achieve high levels of success through the implementation of collaborations with other industry players.

References
Ireland, D., Hoskisson, R., & Hitt, M. (2008). Understanding business strategy: Concepts and cases. Boston, MA: Cengage Learning.
Knapp, K., Okamoto, M., & Black, B. L. (2005). ASHP survey of ambulatory care pharmacy practice in health systems–2004. American Journal of Health-System Pharmacy. 62(3), 274–284.
Krafft, M., & Mantrala, M. (2006). Retailing in the 21st Century: Current and Future Trends. New York, NY: Springer-Verlag.
Shane, R. R. (2012). Translating health care imperatives and evidence into practice. American Journal of Health-System Pharmacy, 69(16): 1373–1383.
Snyman, R., & Kruger, C. (2004). The interdependency between strategic management and strategic knowledge management. Journal of Knowledge Management, 8(1), 5–19.
Srivastava, A., Bartol, K. M., & Locke, E. A. (2006). Empowering leadership in management teams: Effects on knowledge sharing, efficacy, and performance. Academy of management journal, 49(6), 1239-1251.
Stark, J. (2006). Global Product: Strategy, Product Lifecycle Management and the Billion Customer Question. Adelaide, Australia: Springer.
Watkins, E. (2009). From history of pharmacy to pharmaceutical history. Pharmacy in History. 51(1), 3–13.