Building a scalable online pharmacy

Tariq Muhammad explains what pharmacy businesses need to consider if they are thinking about moving into the online space…

The recent growth of online pharmacy service providers such as Pharmacy2u, Echo and Well have inspired some pharmacists and worried many others.

Although at present only 2 per cent percent of all prescriptions are dispensed by online pharmacies compared with general internet sales which hit 36 per cent last year, you don’t need a crystal ball to see which way things are headed.

In a recent report the European online pharmacy market is expected to grow at a Compound Annual Growth Rate (CAGR) of 14 per cent over the next five years with the UK being the second largest European e-pharmacy market after Germany.

Of course, we could blame the pandemic but the trend has been moving in this direction for a long time. A public hungry for convenience, often viewing medicines as just another consumable, have gravitated towards providers offering expediency.

And it’s not just NHS prescriptions. Online services who have combined an effective ‘consultation with supply’ for various chronic and acute conditions have also seen huge gains.

So clearly there is an opportunity in online pharmacy. But before you rush off to set up your online service, there are a few things you may want to carefully think about.

Your ambition

First and foremost, you need to think about the scale of your ambition. For example, if you currently operate community pharmacies and simply want to have an online presence so your customers can access your services better, then this can be fairly straightforward. There are a number of suppliers that will provide ‘out of the box’ websites with ordering capabilities that allow you to offer OTC and repeat ordering to patients. This can be a cost-effective way to enhance your profile whilst allowing you to continue to focus on your bricks and mortar business.

If however, you are seeking to go head to head with the big players, have deep pockets, and want a slice of the growing e-pharmacy market, then that is a different ball game all-together. Here are just some of the things to think about if you are considering going large.

Your vision

Online pharmacies can be categorised into OTC, Private Services and NHS Dispensing. You will need to decide which area you will be going into. Whilst it is tempting to do a bit of everything, sometimes having a clear focus allows you specialise in one area and become the best in class.

Are you providing an App or website or both? This is a crucial factor in how you want your customers to engage with you and access your services. It is becoming increasingly common for businesses to offer both so customers can decide which is best for them.

Like in any business you need to think about your USP. Do you want to be known for the best customer experience, speed, convenience or price? There is no right or wrong answer, but in an increasingly crowded market you need to think of ways to stand out.

Tech first

Uber is not a taxi company, AirBnB is not a hotel operator, Deliveroo is not a takeaway and Amazon is not a retail store. These are tech companies first that just happen to provide a specific product or service on their platforms. They have disrupted their industries by creating a new consumer experience underpinned by powerful technology.

If you are serious about moving into the online pharmacy space, it may be an idea to think less like a pharmacy operation and more like a tech business. Your value will be in the technology you create which is different to how pharmacies are valued. The better your technology, the greater your value.

Get a team

As a pharmacist you’ll be forgiven for not knowing everything about database architecture, cloud hosting, firewalls, info security, GDPR, API, UX, UI, full stack development. You will need to surround yourself with people who understand these often complex areas and lead the development of your product.

It is often tempting to outsource the development to an agency either in the UK or overseas which provide an all-inclusive solution. However this may be a false economy if you want to retain control over your product and be ‘agile’ in your development. If you have the means, then investing in your own team who understand your vision and values will pay dividends in the long run.

Process process process

A common mistake by those starting out is to whip something together, get some business coming in and then worry about the refining things later. Unfortunately, it is harder to change things once you have an established customer base. Sure, you will get a few patients, but you will hit your ceiling early on and struggle to grow thereafter.

It is worth spending the time to think through the customer journeys. This means a stepby-step map of everything that happens from the moment the patient clicks ‘order’ to the moment the completed packages leave your warehouse. Then repeat this for every scenario. A detailed process map will help you build an effective workflow, iron out any inefficiencies and prevent growing pains further down the line.

Get right platform

You should only build the things you need and integrate with existing technologies where they exist. Platforms like Salesforce, Xero provide excellent integrations for CRM and financial controls.

When it comes to your pharmacy dispensing, you will need a PMR that allows easy integration. Titan PMR allows you to ‘inject’ prescriptions directly from your system into the dispensing workflow using open APIs.

Then as the prescription goes through the dispensing process, Titan sends out trigger API events which can be used to integrate back to your systems so you can monitor the stage of each item. This rich integration allows you to enhance your customer journey and improve your operational performance.

Of course, there is a lot more to setting up and running an online pharmacy business than I can fit onto one page. Above all, you can learn from others, identify their mistakes and do it better. Get it right, and you could find yourself in line for a decent slice of the growing online pie.

Tariq Muhammad is CEO of Invatech Health.