Home' Australian Pharmacist : October 2011 Contents Vol. 30 -- October #10, 2011
friendly pharmacies conference
When the going gets
By Andrew Daniels
Pharmacy retail trading sales are at
some of the worst levels for a long
time -- some say 50 years according to
AFSPA President, Jim Howard.
'Have you thought what is
happening to your stock valuations
on 1 April when up to 1600 SKUs
covering 200 molecules drop in
price overnight? The value will
drop by 23% minimum, or more.
What do you think will happen to
the wholesaler's stock valuations?
They'll drop by 23% to 30%. What
will happen to your rebates?
'All this is at a time when
Australians are keeping their hands
in their pockets and not spending.
'So have we entered a new era?
Will it all go back to the good old
times? I don't think so -- and the
discounters will still be there,
Mr Howard said.
He said pharmacies are facing
continuing upward pressure on
costs and downward pressure on
'If prices stay the same and costs
productivity improvement to stay
in the same place. You need to take
a long hard look at your business
and identify critical issues, draw up
a plan to manage the issues and
develop contingency plans to take
advantage of opportunities as well
' he said.
Mr Howard recommended
maintaining a working relationship
with the bank as while nervous,
they still have money to lend
to well run businesses. He also
urged delegates to be relentless in
cost control and to go for the low
hanging fruit such as travel, general
expenses and entertainment.
By Andrew Daniels
Pharmacists should be playing a
role in promoting health literacy and
Further, pharmacy, industry and
government have no choice but to
make Australia a healthier place.
Australian Food and Grocery Council
CEO Kate Carnell told delegates to
the Friendly Pharmacies conference
that pharmacies are in a unique
position to play a fundamental role in
She pointed out that 80% of all ill
health and premature death is due
to chronic disease with risk factors
contributing to more than 30% of
Australia's total burden of death,
disease and disability.
'We aren't eating properly, 61% of
adults are either overweight or obese
and 25% of children are overweight or
obese. Did you know that 82% of girls
(12--18 years) get less calcium than
All this is putting pressure on the
health budget, 30% of it is avoidable
but only 2.1% of the health budget is
for preventive measures.
Ms Carnell said that customers trust
'Pharmacists regularly provide advice
on giving up smoking and weight
loss. Pharmacists are a source
of information and interact with
customers on a wide range of health
Delivering his opening address to
the 250 delegates at the Australian
Friendly Societies Pharmacies
Association (AFSPA) conference held
at the Fairmont Resort at Leura in
the Blue Mountains west of Sydney
last month, Mr Howard tempered the
bleak outlook with a positive message.
Hard times and problems create
opportunities they are a catalyst
He said the conference aimed to talk
about issues about the operation
of retail pharmacies, management
aspects of pharmacies and, 'some
great ideas to implement in your
Mr Howard listed Pfizer's move
to direct distribution and changes
to the PBS as key issues facing
pharmacies. In the PBS, accelerated
price disclosure from 1 April 2012
dropping the price on up to 1,600
items in the ethical category would
have huge consequences -- especially
as it will happen right on Easter
week (5--9 April) the second biggest
pharmacy 'script' week of the year.
'The government sees the PBS
as an easy target. They don't care
about margins and profitability of
pharmacies, or the fact that wage
increases have to be paid, or that
rents continue to escalate, or utility
costs are increasing.
'They do not care whether individual
pharmacies survive, they just want a
distribution network for government
Debbie Rigby and Kate Carnell
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