DOHA: Many single pharmacies are on the verge of closure or merging as they find it hard to make both ends meet. While pharmaceutical chains are expanding their network in the country, smaller facilities are being forced out of business.
The heavy rent, workers salary and other expenses are becoming a major burden for the independent/single pharmacies. The government—mandated price cuts on medicines have also taken their toll on these outlets, by pulling down their profit margin by almost half.
“Small pharmacies are struggling to survive. The expenses have skyrocketed and our profits have gone down by almost 50%,” said Muhammad, a pharmacist who works at a single pharmacy.
“Independent pharmacies that have a sale of less than QR5,000 on daily basis are truly struggling. Owners find it difficult to pay salaries and meet other expenses as needed. Hence many are opting to merge or pull shutter down. Over the last couple of months, a number of pharmacies have merged with bigger chains,” he said.
Major rip for these independent chemists are medicine price slash by the government. The phased reduction is part of a GCC-wide initiative to unify import costs. There has been an average of 15% price cut in Qatar with prices of medicines for chronic diseases cut up to 45%, according to industry sources.
“Many small chemists are operating in loss and are on the verge of closure, mainly due to the financial situation. Expenses are rising, including rent. Qatar has the highest rent for a normal office space compared to other countries in the region,” said Abdulrahman E P, Managing Director, Care and Cure Group.
“The profitability has been reduced due to price standardisation. This heavy reduction in turn makes it difficult for pharmacists to get the necessary profits as there is a limit to the percentage of price hike allowed,” Abdulrahman said.
“If the current situation continues, independent chemists will have to work harder. They should work on ways to reach more customers and look for better marketing tools. A majority of the pharmaceutical groups here started out as a single pharmacy,” he said.
Added to this, unlike pharmacy chains, single pharmacies cannot enjoy the benefits of buying medicines in bulk. Often large chains get additional number of medicines as a bonus when medicines are bought in huge quantities.
“At times, seasonal medicines are not available with us. We cannot get the necessary stocks from the distributors, as major groups have already bought these medicines in bulk. As a result, we lose even our regular customers and small chemists like us could be forced out of business,” said a worker at an independent pharmacy.
Large pharmaceutical groups do centralised purchase, which is then distributed to their branches. This means chains have bonus amounts of medicines which add to the company’s profits.
“We buy medicines centrally for all our outlets. Hence, they are bought in huge quantities from distributors, who also give us the bonuses. This is the profitability, not something that we plan and do. There are times when we also run out of specific medicines,” said Abdulrahman.
