When Calvin LeRoux and a group of key owners developed a member-owned co-op approach for independent pharmacies, they knew it would take 30 to 40 locations to get off the ground.
By Jane Auster
Photography by Aaron McKenzie Fraser (East) & Matt Smith (West)
Seventeen years later, PharmaChoice numbers more than 600 independent pharmacy owners across Canada…and counting. Recently, I checked in with Eastern CEO Calvin LeRoux and Western Canada CEO Grady Brown to take the pulse of this rapidly expanding pharmacy business to see what makes it tick.
What niche do you see PharmaChoice inhabiting in the crowded pharmacy landscape in Canada?
Calvin LeRoux. I don’t know if it’s so much of a niche position but a leadership position. We provide a comprehensive set of tools for pharmacy owners, such as volume buying, marketing, technology and shared best practices, which allows them to compete with their strongest competitors and gives them a way to enhance their current offerings. We know there are more than 3,000 independents in Canada, and we know that PharmaChoice is the program that will provide them with the best ROI.
How are you evolving?
Grady Brown. We added over 80 stores nationally in 2015 alone, and since passing 600 we think that 650 is only six months away. This is a key milestone from when the east met the west in 2005. Organic growth has been consistent and exponential, with every staff member executing on plans. We also see opportunities for consolidation. Particularly in the west, there are as many as 400 to 500 independents which are still unaffiliated. Our biggest growth driver is Ontario and the balance of Western Canada.
What do you see as your key advantage?
CL. The banner not only provides tools to succeed, but we give our owners an opportunity to sell their business when they exit. Current owners can expand, or a new young pharmacist can come in and buy a first pharmacy. With 600 stores and growing, there will be a lot of transitions over the next five years. We facilitate retirements and provide opportunity for young owners. Some owners also look to us to help them expand their business. They enjoy the ROI and set of tools, and the opportunities to expand to more than one store. Many of our owners have two to three and as many as five to 10 locations.
Are technology innovations fueling your growth?
GB. Our recent announcement with Providen Pharmacy Logistics to provide a total systems approach to integrated central fill support services for independent pharmacies under our banner in the west is a demand our members have been asking for. The central fill in Calgary, which should be operational later this year, will help ease the burden of dispensing and free up time for new expanded practice clinical services.
CL. Central fill is a big one. We recognize that technology is becoming more and more important for all pharmacies. Our customers are demanding we perform at a certain level, so we are always looking for new innovations.
GB. We’ll be launching MedSync, a clinical pharmacy tool for pharmacists to help them increase patient adherence to chronic medications.
CL. Our mobile app recently launched. This allows our customers to get their refills done in an efficient way. The technology appeals to a wide base of patients, especially younger ones who are becoming older customers over time and those who are caring for aging parents.
With a rapidly growing co-op network, how do you communicate with your members?
GB. We’ve created a (virtual) community for our members to encourage the sharing of ideas in our community; it’s a peer-to-peer connection tool which functions very similarly to familiar social networking sites.
CL. It’s a great system to help stores, especially new stores, in the system. New stores have to be up to date, so this community is a great repository for information. If I want to find planograms, for instance, it’s all in our community.
At a time when pharmacy in Canada is changing rapidly, what do you see as the next big moves?
CL. We will see new enhanced services (mandated by) the provinces. Independents, especially PharmaChoice owners, are adept and able to offer those new services. We have been encouraging our members to engage in these enhanced services by offering the tools required to succeed.
There will also be more consolidation. The unaffiliated will need to find a home. As more pharmacy reform comes in, we are going to gain as the unaffiliated join us. Banners of 20 to 30 stores will not be able to continue what they’re doing. Especially in Western Canada, the best way forward may be to affiliate.
GB. We may look at some strategic alliances with other banners. As stores look for a home, they are going to seek transparency and maximum value at the office level. We definitely have the room to grow.