Founder and director Anthony Yap has set a number of goals for his discount chemist chain, Good Price Pharmacy Warehouse. 

These include achieving a nationwide footprint within the next five to 10 years, delivering quality customer service and offering the most extensive range of products.

“We want to be Australia’s most recognised and most respected pharmacy brand,” he says.

“We want to be known for having the biggest range and the lowest prices as well as good customer service that meets the standard consumers come to expect when visiting a pharmacy.”

Yap believes this is where Good Price Pharmacy Warehouse differs from its competitors – it offers the entire package.

“Although we have the biggest range and although we offer probably one of the lowest prices around, we do not want to compromise on the service that we offer as part of our customer experience.”

EXPANSION

Yap plans to achieve the expansion goals he’s set for the business through the acquisition of existing sites as well as opening completely new outlets. 

The company recently acquired two Oze Pharmacy stores as a means of entering the Sydney market, and there are plans to take on another two before the end of the year.

“We’ve already got stores in New South Wales but we really haven’t got a large presence in the Sydney metropolitan area, so we saw the acquisition of these stores as a good starting point which will hopefully then spur on further acquisitions or new store openings in the metro area,” says Yap.

He believes the acquisition strategy is beneficial in many ways – namely it enables the brand to expand at a much faster rate.

 “We saw the opportunity to convert the Oze Pharmacy stores to our brand because they already had the floor space, range and method of operating that we do. We thought that by leveraging our brand and our marketing we would be able to get some quick wins with increases in turnover and profitability almost immediately,” Yap explains.

“This will potentially convert or act as the impetus to convert some of the smaller big box pharmacies operators into our brand so that we can get economies of scale a lot quicker in the other states.”

Expansion will also be achieved through the opening of Greenfield sites, and Yap believes company growth will speed up the process.

“At the moment we’re aiming for around six to 10 new stores per year, whether that be Greenfield sites or conversion of existing sites, but as we progress the actual infrastructure that we require to roll out these new stores will grow, and we’ll be able to roll these stores out a lot faster, so I do expect that the speed of increasing store numbers will improve over the next few years,” he explains.

BUSINESS PERFORMANCE

Yap says the business is tracking well, and he hopes to see an increase in revenue year on year.

“We’ve had double digit growth for 13 consecutive years. In 2013 it was 17 percent and we’ve got an addition of 20 percent as a company for this year.”

He attributes the company’s success in part to its carefully planned and controlled growth strategy. “I think a lot of brands fall into the trap of expanding too quickly, and if you have too many Greenfield sites all at the same time it could be a recipe for disaster if they don’t perform well.

“We want to make sure everything is controlled so that when we actually put on new sites every single one is a winner,” he adds.

Firm turnover objectives have also been established for the future. “We definitely want to be a national player with over 100 locations and eventually the long term goal is to have over a billion dollars per annum in sales,” says Yap.

SUCCESS THROUGH FRANCHISING

Yap says Good Price Pharmacy Warehouse was a wholly company owned business for the first eight years – he wanted to ensure its systems and procedures were well established prior to taking the franchising route.

“We had a relatively proven model before we considered going out there and offering it to the market, and I think that’s what people buy into: a proven brand with proven systems and proven results – I think that’s why we’ve been able to continue to expand over the last four to five years.

“We made sure that we had a proven network of stores because people have to believe in what you’re actually offering, and you’ve got to be able to prove to them that it’s going to be successful before they actually buy into the model,” he explains.

Yap recognises the value of the business’s key franchisees in Western Australia, South Australia and New South Wales, and hopes to utilise their existing networks to help expand the brand. 

“When we first started out it was predominantly company owned stores, but then we realised that for us to get economies of scale and build the brand it was necessary to tap into the franchise market,” says Yap.

“It meant we could get access to sites that would be financially unviable if we were to try and do it ourselves.”

He recognises growth through franchising will be achieved only when both the franchisor and franchisee benefit. 

“The trade-off for us is that we are able to expand the brand across various states because a lot of these places are quite far away from our head office, so it makes sense for a franchisee to own and run the store themselves, and in exchange we give them a model that will be sustainable in the future.

“As competition increases and there’s continued pressure in the pharmacy industry itself we provide franchisees with something that will ensure the sustainability of their store moving forward,” he adds.