It has been a very long time since we saw a private retail pharmacy being set up in Singapore. Probably we won't see a change in trend anytime soon.

One thing for sure is the steep property prices are one of the current impediments for anyone with less than a bold heart to make such a shift; but before that, the newly adjusted pharmacist salary will probably make one seriously computes the opportunity costs of striking out on his/her own. Like any other businesses, retail pharmacy business doesn't differ significantly in other business operations - startup capital, cashflow, turnover, manpower, product, customers, compliance etc. The big difference being retail pharmacy sells a lot of drug/health-related products; as well as providing health and drug-related advice, often without charge.

If we compare a GP clinic, a dental clinic and a retail pharmacy, it’s quite easy to see that the startup cost for a GP clinic seems lowest in terms of capital outlay; whilst pharmacy and dental clinic are relatively capital intensive – probably in the range of few hundred thousand dollars. Dentists need to invest in the expensive equipment, the chair, sometimes X-ray etc.; whilst pharmacists need to stock up and finance a decent range of medications, nice retail furnishing & decoration, air-cond the whole shop etc. – it’s idiot-proof for banks and suppliers to provide no credit line. Therefore, corporations with deep pockets, often those who have considerable experience running other retail businesses, start getting into the fray, opening chain outlets in every strategic location. This puts further pressure to the budding, inspiring pharmacists to set up shop and dampens entrepreneurship further. All those working in the chain pharmacies know full well that the procurement price of medicinal and health products is real tough one – chain stores with the muscles of central purchasing power can tame suppliers a lot more easier than the solo pharmacy regardless of how well he/she knows the suppliers. Sometimes, it’s even possible for the selling price of the chain shop for a specific product to be lower than the cost price of the stand-alone pharmacy. In summary, the are enough impediments to own pharmacy a pharmacy business in Singapore, there are sufficient barriers to want to take such risks!

On the other spectrum of the situation, the macro environment seems to deserve some closer scrutiny and pragmatic assessment, eg.

1. demographic trends toward ageing – anything for grey hair to no hair, ambulatory to bed-ridden, wrinkled skin to dry skin, nursing home or home nursing; 
2. the retiring generations of  educated consumers – those who choose to self medicate, those “wiser ones” choose  the option of preventive healthcare instead of interventional treatment, those believing in personal wellness instead of material wellness; 
3. elastic demands for health care services and products – health care services and products are essential component of everyone’s life, it’s the issue of what intensity and when; sound and credible pharmacists will build up clientele through sheer professionalism; 
4. professional exclusivity – like other health care professionals, pharmacists are “shielded” from overt competitions from the non-professionally trained practitioners;
5. evolving legal environment – globally, more and more Rx drugs are being switched to OTC categories thereby enabling easier and hopefully more cost-efficient access to medications; this certainly means a lot for consumers who are prudent and know how to maximize their hard-earned dollars, especially those who don’t have payor-supported scheme like self-employed, uninsured housewives/children etc. Pharmacists play a vital role in promoting & advocating responsible self-medication.

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The list could potentially grow longer, but having said that; knowledge can never be power when it’s not translated into actions. Opportunities can be found in all the above as listed. The least convincing analogy is that there are too many car mechanics chasing too few cars? and yet many car mechanics can still survive today’s adverse business environment through innovation and diversification into areas beyond the engine bonnet!

Between taking risk and pursuing opportunities, the two often have opposing effect in one’s decision making; but hopefully we will have more opportunistic risk-takers in our midst.

Here’s wishing all and family a Happy and Prosperous Lunar New Year?  ???.???????

Ng Cheng Tiang
President, Pharmaceutical Society of Singapore

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