THE advent of Chemist Warehouse across the Tasman (PD Mon) is one of several significant threats to New Zealand pharmacies sector, according to a new report benchmarking the New Zealand pharmacy sector.
Major disruption is being forecast by accounting and advisory firm Moore Stephens Markhams, which has just conducted its 2017 survey which collates responses from more than 140 pharmacy businesses across the country.
Retail sales as a percentage of total revenue have declined over the past five years, with many pharmacies in NZ “finding it increasingly difficult to keep retail sales at historical levels,” according to Atul Mehta, director of the pharmacy unit of the consultancy.
“Pharmacies that have performed exceptionally well have found further revenue streams to tap into – providing additional services, being part of a funded trial, or finding new platforms to trade with additional customers,” Mehta said.
He said the 2017 survey indicated a mixed bag of results, with average gross profit within pharmacies remaining constant over the last three years despite increasing challenges facing retail generally.
Pharmacies have faced government funding pressure, the threat of deregulation and the encroachment of new players, including competition from non-pharmacists which was described as a “serious threat” as other businesses increasingly sell traditional pharmacy products.
Another key trend noted was the use of robotics in dispensing.
On average the study found pharmacies employing robotic technology had a slightly lower percentage of wages to costs, with some significantly lower.
The study also highlighted the ongoing evolution of the NZ pharmacy sector, with almost a quarter of the 141 participants having had either an ownership change or been set up as a new business in the past three years.