Pharmacy U

All posts tagged Max Beairsto

When should you transfer wealth to your kids?

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What are some of the factors a family should consider when passing money along to the next generation? Read more

Pharmacists, cottages and family dynamics

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We work with countless pharmacy owner families across the country and we have found that one of the most important submerged legacy assets is often ignored in the strategic wealth plan – the family cottage. Read more

Funding long-term care costs – the retirement issue we should be talking about

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As people age, the likelihood of requiring some form of supportive care either at home or in some kind of long-term facility increases. It’s a reality that’s growing and cannot be ignored. Read more

What are the costs of long-term care?

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Most people want to remain in their homes as long as possible – an option that can be affordable if you need only a few hours of help per day or week. Read more

Take the guesswork out of your retirement

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Whether we acknowledge it or not, we all have a nagging little voice in the back of our heads that goes around and around wondering whether we currently have enough money to retire and if so, can we continue to enjoy the lifestyle we have come to expect? Read more

Pharmacists should read their Hemingway

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The state of the union for current pharmacy owner finances, both personal and corporate, is best described as being a mix between “For Whom the Bell Tolls” and “The Sun Also Rises.” Read more

Lifecycle planning for pharmacists

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No business remains the same over the course of its lifetime, from startup to exit. Read more

Ready to buy a new pharmacy? Read this first…

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This should have been the happiest of times. Would-be pharmacy owner John was the winner of a bid for a new pharmacy, and he was excited to settle in and get working. Read more

Value drivers to sell your pharmacy business at the highest price, part 4

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Although some buyers in the market focus almost entirely on numbers in their approach, it is important that you pay attention to the physical appearance and condition of your facility and equipment. This factor extends beyond the shelves, ceiling and floor, to the tidiness and cleanliness of work areas and your staff. Read more

Value drivers to sell your pharmacy business at the highest price, part 3

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By Mike Jaczko & Max Beairsto

In two earlier installments (part 1 and part 2) we identified six factors that drive the value of your pharmacy business. Here, we pick up where we left off.

#7. Competitive advantage

Your “monopoly of control,” as described by John Warrillow in Built to Sell, describes a concept that answers the question of how well your business is differentiated from competitors in your industry. Seth Godin, who wrote the Purple Cow, also laments on the importance of uniqueness and differentiation in your organization. Essentially, it boils down to developing a business where you have created your own monopoly; it is the only place where your customer can shop for your unique offering of services, products and courtesy.

The provision of unique value-added services and products is the glue linking your pharmacy business with your customers and patients. Creating some form of competitive advantage to prevent competitors from copying your activities will provide a “moat” around your pharmacy business. Some buyers will pay a premium for a niche that has barriers to competitive entry, but this can be a double-edged sword. If you have created something so far off the beaten path, it is sometimes difficult for a corporate buyer to envision your business in their fold.

Experts have identified numerous ways to create a competitive advantage, but some seem to resonate more for the pharmacy industry. Although trademarks and patents do not readily lend themselves to creating a competitive advantage for a pharmacy, developed processes, compound recipes, training programs, published articles, specialized licences or certificates, and service contracts do. Do not discount your location—and the security of your lease—as these can serve as a major barrier to entry for your competitors.

8. Patient/customer relationship

While the patient/customer relationship is somewhat related to competitive advantage, it is nevertheless deserving of recognition on its own. How likely are your patients to return to renew a prescription or re-purchase a product or, even better, refer friends and family to your pharmacy? The majority of your peers do not actively seek out or quantify the answer to this, but your corporate competitors actively pursue this information.

Stability, consistency, repeatability, reliability and sustainability are a few of the key attributes to establishing a meaningful customer relationship. Your quality marketing program needs to create name recognition (of both the business and key employees) and build customer awareness and loyalty. A long history of efficient operations, producing timely and accurate prescription output and complimentary professional advice, will drive a valuable reputation in your community.

While, the value of your business will in part, be related to the hard, tangible assets, it is the goodwill that constitutes the majority of the price a buyer will pay. Therefore, it is these softer value drivers that will help drive goodwill in your pharmacy business. Relationships and patient/customer habits remain the nectar of the valuation gods.

Mike Jaczko, BSc Phm, CIM® is a pharmacist by background, is a portfolio manager and partner of KJ Harrison, a Toronto-based private investment management firm serving individuals and families across Canada. For more information, email:

Max Beairsto, B.Sc. Pharm., MBA, CVA is a certified valuation analyst and business intermediary with Enterprise Valuators, an Edmonton-based valuation and business sales advisory firm. Their Pharmacy Edge division assists pharmacy entrepreneurs across the country needing transactional and valuation advice. For more information, email:


This article first appeared in Pharmacy Practice + Business.