Why can't independent pharmacies compete with big chain pharmacies?

Question

Is price really the only advantage that big chain pharmacies have over independents? What about service and environment?

Answer 1

Well, the things you mention like service and environment are what the marketing guru world calls "value beyond price". And it is, admittedly, a very strong influence on consumer behavior, but it is also more influential in some sectors and less in others. I suspect that because independent drugstores are really no longer "community hubs" like they once were (soda fountains, lunch counters, etc.) that consumers see them as just another dispenser of medication, right on par with the chain operations. When indie pharmacies used to market a "shopping experience" vice simple med dispensing, they had value beyond price. Now going to most of them is just like going to CVS.

Answer 2

It's a simple issue of bulk and decreased reimbursement from insurance companies. A company which buys more will be able to negotiate better prices than little company. Many independents are involved in buying groups. For a pharmacy, the average profit per prescription is about 2%. I find the grocery pharmacies tend to have better service and lower volumes.

Answer 3

service and environment do matter, that's why a lot of people do still prefer to go to independant, mom and pop type stores for all things. But price is a big key, and so is convenience. Big chains buy in much larger bulk, strike up bigger direct deals with pharmaceutical companies and are able to offer a bigger variety of not only drugs, but also general supplies, food, etc (think Walgreens and CVS). They are able to buy up bigger store fronts to be able to offer big parking lots and multiple services. It's tough to compete with all that they can and have to offer with just better service and environment.

Answer 4

Who cares about service and environment when you are dying?