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Front-of-shop: the new battleground

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Large established brands and smaller independent buying groups combine forces to create a strong and clear market offering for consumers

The consolidation of brands such as the new combined TerryWhite Chemmart group, signals an emerging change in direction for the market. Market researcher, IRI says it is seeing other large established brands and smaller independent buying groups combine forces to create a strong and clear market offering for their consumers.
“This movement and alignment under single pharmacy retail brands is reflective of the growing focus for groups to differentiate themselves using brand, value, professional services and ‘front of shop’. Influencing these changes is the impact of “out-of-the- box” retailing strategies in a very traditional channel, such as Chemist Warehouse, which has capitalised on a very strong low cost value proposition to consumers.

IRI’s Healthcare development director, Kurt Petersen comments that the pharmacy market is changing its model.

“We are seeing the change in strategy more reflective of what has been occurring in the grocery channel for some time. Key banner groups are using product assortment for differentiation with their pharmacies; consistency of range; the importance of using price to demonstrate retail brand value; and  changing supply chain logistics to meet consumer demand.”

As the retail pharmacy channel continues to face downward pressure from the Federal Government who continue to look for ways to optimise the funding of the PBS, pharmacists need to broaden their role supporting their communities through the products and professional services they can offer, says IRI.

“Today’s pharmacist is under a lot of pressure to add additional services and care beyond the dispensing of prescription medications, such as new over-the-counter (OTC) products and categories, extra support such as pharmacy services and community care. The enhanced focus and attention on these areas is a positive move for the community; however it means it is critical for pharmacists to get the offer right to continue to be a central health destination for the local areas they support,” adds Mr Petersen.

 

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