If you are considering pharmacy ownership but don’t know where to start, we’re here to help you figure it out.
What Does it Mean to Take Over a Pharmacy?
Taking over a pharmacy means you’re buying a pharmacy business that is already established. You would then be the new owner and be responsible for day-to-day operations and the pharmacy’s success.
Who Should Take Over a Pharmacy?
The short answer is anyone with the drive, desire, and determination to take over a pharmacy can do it. It’s important to remember, though, that much more work goes into it on top of just being a pharmacist. To have successful pharmacy ownership, you should be:
- Eager to learn
- Financially savvy
What Does a Day in the Life of a Pharmacy Owner Entail?
Owning a pharmacy comes with several responsibilities, and while your work tasks may vary from day to day, there are a few things you can expect to address daily. These tasks include:
- Accurately filling and dispensing medications
- Verifying prescriptions
- Ordering and distributing medical equipment
- Managing pharmacy workflows
- Advising about over-the-counter medications
- Overseeing day-to-day pharmacy operations
- Conducting medication consultations
You will also handle patient interactions, maintain patient records, and ensure the pharmacy runs smoothly during business hours. You can learn more about a day in the life of a pharmacist here.
What Should a Pharmacy Have in Place if You’re Considering Ownership?
Before buying a pharmacy business, you should consider a few different things. Is the pharmacy profitable? Do they have a robust client base and a strong reputation? Do you like the current location? You want to make sure you’re making a sound investment in a pharmacy business before you move forward with the acquisition.
Researching and Analyzing the Pharmacy
Take time to perform a valuation on the pharmacy you are considering. This is where you will look at various factors, including:
- Pharmacy profitability
- Revenue trends
- Growth potential
- Incurred expenses
- Cost-saving opportunities
- Prescription volume and mix
- Long-term contracts
Looking at all these things can help you decide if the pharmacy you want to take over is the right one for you.
Legal and Regulatory Considerations
Legal and regulatory factors will vary from state to state, so it’s important to know the laws and regulations in your state. You’ll also need to get several licenses to own a pharmacy. These will include:
- Employer Identification Number (EIN)
- Drug Enforcement Administration (DEA) Number
- National Association of Boards of Pharmacy (NABP) Number
- National Provider Identification (NPI) Number
- State Board of Pharmacy Permit
How Long Does it Take to Take Over a Pharmacy?
Timelines will vary depending on how long it takes you to find a pharmacy, get financing, obtain licenses, and negotiate your purchase agreement. In most cases, the process can take between six and 12 months.
Developing a Plan for Acquisition
Once you’ve found the pharmacy you’d like to buy, you’ll need to develop a detailed plan for the acquisition. This includes developing a business plan and entering negotiations with the current owner.
Creating a Business Plan for Taking Over a Pharmacy
Your business plan guides the direction of your pharmacy business and helps you know which steps to take — and when — to achieve your business goals. The business plan is also essential for gaining financing for your pharmacy, so you want to ensure it is detailed and accurate. Here are a few things to include in your business plan.
- Pharmacy niche and branding
- Target market
- Location and space
- Potential team members and titles
- Potential expenses
Negotiating With the Current Owner
One thing you’ll need to know about how to take over a pharmacy is that you will end up negotiating the purchase agreement with the current owner. During these negotiations, you’ll settle on various factors, including the purchase price, employee retention, included items, and more.
Your Pharmacy Owner Checklist
Once you are ready to move forward with pharmacy ownership, here are a few essential things you need to take care of as part of your pharmacy owner checklist.
Even though you are acquiring an existing pharmacy, you still need to have a clear idea of how you’ll fund the business under your ownership. You’ll need to create a plan to secure financing to buy the pharmacy and cover operating expenses.
Register Your Pharmacy for Taxes
As part of your financial plan, you must register the pharmacy for taxes under your new business name. When you do this, you’ll get a federal and state tax ID number and multiple accounts, including payroll, property, and sales tax accounts.
Open a Business Bank Account and Credit Card
Take time to open a business account and get a credit card for your pharmacy. Doing this separates your personal and business funds, protecting your own money and helping build the credit your pharmacy has.
Set Up Accounting for Your Pharmacy
Whether you handle the finances yourself or hire a professional, you’ll need to set up business accounting for your pharmacy. This is the easiest way to track your expenses and keep all the info in one place come tax time.
Although you are buying a pharmacy business that has already been established, you’ll want to create a marketing plan that builds brand recognition and customer loyalty under your ownership. As part of this plan, you should do the following.
- Create a new pharmacy website
- Build an online presence on social media sites
- Set up your new phone system
- Offer incentives to draw customers into your new pharmacy
How Do Pharmacies Make Money?
As part of pharmacy ownership, one of your main focuses will be profitability. Pharmacies make their money based on their goods and services, so you should aim to get your medications and products at a lower cost to help you make a profit.
When opening an independent pharmacy you’re acquiring from someone else, look at their revenues, expenses, and free-flow cash projections to help you determine if the pharmacy is currently making money.
Managing the Transitions and Operations
So, how do you take over a pharmacy already in business? You’ll need to focus on the transition and operations.
Planning for a Smooth Transition to New Ownership
You’ll likely acquire all existing employees when you take over a pharmacy. Take time to meet your employees and learn how they function in the pharmacy. Do what you can to make the transition smooth, and wait to make significant staff or operational changes until you get a better feel for the pharmacy.
Managing Day-to-Day Pharmacy Operations
You should spend a few days working alongside your employees to get a feel for the day-to-day operations. Before making any changes, this is essential so you can determine what is working and what can be improved.
Are You Ready to Buy a Pharmacy Business?
Pharmacy ownership can be an exciting venture, and many pharmacists see it as a natural step after earning their degree and working in the field for a few years. If you think owning a pharmacy is the right choice, you should start looking for purchase opportunities in your area.
If you aren’t quite ready to take over a pharmacy but want to enhance your experience in the industry, consider joining ShiftPosts. Our innovative, user-friendly app helps you find open shifts in different areas and gives you more experience in various roles while increasing your earning potential. Contact our team today to learn more.