The growth of the medical sector in India is phenomenal. The healthcare industry has been growing consistently by double-digits for more than a decade. The medicine business was targeted as a sector that would be least affected as India recovers from Covid. The pharmaceutical market in India, which consists of bulk drugs along with formulations and diagnostics, is estimated to be US$ 42 billion in 2021 and is likely to reach US$ 65 billion by 2024.
Starting a pharmacy business in India is exciting and lucrative. There is an enormous scope of profit and headway in this business. The pharmacy business is growing at a double-digit rate, thus creating a massive opportunity for pharmacy entrepreneurs to increase their business rapidly. Whether you are planning to start a small pharmacy store or a multi-branch franchise of a big brand, this article provides valuable information on starting a pharmacy business in India.
- Steps to start a medical store business
- Fixtures and storage solutions needed to start a medical store
- How to choose the right location for the medical store?
- Spend some time thoroughly planning your medical store
- How to market your pharmacy store locally?
Steps to start a medical store business
Choose the right type of medical store
Before opening a medical store, you must first choose the type of medical store you want to open. Below are some of the options for you to consider:
Hospital Medical Store
This type of walk-in medical store is located within a hospital, where patients have access to its own pharmacy to buy medical supplies.
Standalone Medical Store
A standalone medical store is the most common type of pharmacy found in residential neighbourhoods.
Chain Pharmacy/Franchise Outlets
These pharmacies are a part of a network of stores located in residential neighbourhoods or commercial spaces. Wellness Forever is an example of a residential pharmacy chain, which you can find in your community.
Township Medical Stores
It is set up in a township to cater to the needs of the people living in the township community.
Medical store license requirements
To start a medical store, you need to obtain a drug license. The Central Drugs Standard Control Organization and State Drugs Standard Control Organizations control the issue of drug licenses in India. Contact information for each state’s Drugs Standard Control Organization can be found here.
In most states, the Drug Control Organization issues two types of licenses for operating a pharmacy. One is the Retail Drug License (RDL) for running a general chemist shop, and the other is the Wholesale Drug License (WDL) for those engaged in wholesale.
In either case, you need to have the following things ready before you apply for a license.
Obtain a pharmacy license
To become a pharmacist, it is necessary to be a qualified pharmacist with a B. Pharm or M. Pharm degree.
Complete land registration process
Depending on your budget, you need to choose between renting a shop or buying one; entering into a lease agreement or purchasing the building outright could also be the right option. Whichever option you prefer, please make sure you have no less than 10 square meters pace for standalone pharmacy and 15 square meters for wholesale business.
Register your company
To register your medical store with the government, you need to register your business. Below are the options available for you.
- Sole Proprietorship Registration
- Limited Liability Partnership
- Private Limited Compan
It is common for a medical store to be a proprietorship or a partnership firm. Pharmacy chains and township medical stores usually prefer to be a private limited company.
Also, register for a Goods and Services Tax (GST) certificate if your annual revenue exceeds 20 lakhs or ten lakhs in the case of the North-Eastern Hilly regions.
Setup storage facilities
Medical stores must be outfitted with refrigerators and air conditioners. These conditions are required because certain drugs, like vaccines, Sera, and insulin injections, must be stored in the fridge.
Appoint the right technical staff members
For the sale of medicine to be conducted in a pharmacy, a registered pharmacist must supervise the sale during the working hours of the pharmacy. However, for a wholesale business, only pharmacists with one year of experience in dealing with the sale of drugs or someone who has passed S.S.L.C with four years’ experience can sell drugs wholesale.
How to apply for a medical license?
The Indian Pharmacy Act, 1948 requires medical stores and pharmacies to register with the state government. After submitting their particulars to the state authorities, they are subject to review by a registration tribunal.
List of documents required for getting a drug license in India
- Application form completed in the right format suggested in the 1948 Act along with the cover letter signed with the details of name and designation of the applicant.
- Bank challan of the fee deposited for the medical store registration process.
- Blueprint of the premises along with the proof document showing the ownership of the premises.
- Proof of business registration (Shop Act, GST Certificate, etc.).
- Affidavit document showing non-conviction of proprietor or partners or directors as per the Drug and Cosmetics Act, 1940.
- Affidavit document showing a registered pharmacist or a person is equally competent who will be operating the store.
- A letter from a registered pharmacist or competent person, if employed, should be attached to your application.
The requirements may vary across different states. Please check your state drug control website for more details.
The total investment required to open a medical store?
To open a medical store in tier 2-3 cities would require an investment of at least 3-4 lakh rupees. However, the cost goes up to 7-8 lakh rupees if you target tier 1 cities. However, there are credit options available from different finance partners.
How to get a business loan for your medical store?
Today many financial institutions offer you business loans. Starting with your bank with which you already have a relationship, to other lending partners such as Lendingkart, Bajaj FinServ, etc. Please consult with them independently to know the process and requirements.
Fixtures and storage solutions needed to start a medical store
Pharmacies in India operate on limited floor space. Hence, you need to have storage solutions designed to suit the area of the facility and offer maximum space availability. We at Instor have developed pharmacy storage racks and shelving solutions that occupy less floor area. Visit our pharmacy segment page to get the complete details. You can also consult with our Pharmacy store expert for free to get your questions answered for free.
How to choose the right location for the medical store?
Medical store location selection is one of the most important decisions because technological advancements, population growth, level of competition, and trend in shopping patterns are major factors that directly affect pharmacy store operating results. So all these things must be taken into consideration while choosing a location for a pharmacy store. To ensure your success, it is recommended to focus on a high-traffic area with no medical store in 100 meters!
Spend some time thoroughly planning your medical store
The industry of pharmacy and wellness is changing, and you’re in the middle of it. What can you do differently to capitalise on this opportunity? If you plan to open a medical store, you have to decide whether you want to put in multiple products or sell medicines only. Many retail pharmacy chains have a good over-the-counter shopping experience. You can also choose to have a pharmacy where customers can walk in and get the medication prescribed by the doctors.
How to market your pharmacy store locally
One of the biggest challenges that retail pharmacists face is how to market their pharmacy stores locally. When marketing your pharmacy store locally, there are many things to consider to make sure you get the most exposure possible.
Here are some ideas to think about:
- Make sure you stand out and make it easy for the customers to find you (big sign, specific placeholders in and around the area)
- Get to know your customers and build a relationship (know your repeat customers and what they need frequently)
- Make their shopping experience as comfortable as possible (offer home delivery if possible)
- Get out and be seen at the local sporting, music events, and festivals.
Medical Store Business in India has a new and great future and due to its amazing growth. There are many benefits of the Medical store business in India like less investment, competitive pharmacy chains, direct sales, etc. Take advantage of this opportunity and get started with your medical store business.