Savings and Service

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-By Kristy Attard

You can’t put a price on your health, but the medicine is undeniably sweeter when it comes at a bargain price. We all want excellent healthcare at reasonable prices and service from people we can trust. Discount Drug Stores offers customers ‘more than just everyday low prices’ on healthcare items. “Our mission statement is to provide healthcare and health services to people in the community at low prices, affordable prices, without compromising our services. That’s success to us from a consumer point of view,” says General Manager Doug Kuskopf-Dallas. With everyday low prices and exemplary customer service, Discount Drug Stores is proving that being healthy does not have to be difficult.

Healthy Business

The current company directors John Clark and Peter Newman, who are pharmacists themselves, established Discount Drug Stores in Queensland back in 2001. They worked on the venture for around five years and in 2006 rolled out the group as a franchise. The business was a huge success and in April last year, Discount Drug Stores celebrated its 10th anniversary with a storewide promotion. Today there are 99 stores conveniently located throughout Australia and by June 2012 Discount Drug Stores will have achieved an impressive 100 stores.

Discount Drug Stores has a traditional pharmacy footprint. Stores are located in convenient local shopping locations “where Mum goes to do her everyday shopping. With our model… we have a specific footprint where we locate our pharmacies so we can keep our costs under control.” Discount Drug Stores avoids locating pharmacies in high rent mega centres. “Rent is a big issue or component with pharmacies these days, but our footprint specifically fits in with the regional or your suburban shopping centre… the key is keeping our costs under control,” comments Mr Kuskopf-Dallas. “As a group we buy very well so that we can pass on savings to the consumer.” This year, Discount Drug Stores was proud to launch its e-commerce website offering a convenient “click and collect” service. Customers can now shop in the comfort of their own homes and then pick up their order at their local store within three hours.

Traditionally, pharmacies retain an everyday high price on products, only offering price reductions during sale periods. Not so at Discount Drug Stores. “We have a low price policy across the board and during monthly promotions we have the extra savings.” On products in different categories, customers can expect to save “anywhere between 10 and 30 per cent as an everyday price.” The discount space is the fastest growing area of pharmacies today. Although Discount Drug Stores is not a big box pharmacy, the group is still competing with them in the discount sector for business.

Community Feel

Although prices are low at Discount Drug Stores, the level of customer service is high. It can be confusing for customers to make the right choice between brands and products crowded on a pharmacy shelf, particularly if they aren’t feeling their best. Discount Drug Stores makes it easy for customers, with spacious, well organised stores that make shopping a headache free experience. There are instore health awareness clinics or health checks on issues such as Asthma, Diabetes and Heart Health, with consultation with a trained nurse or healthcare professional. Providing an exceptional level of customer service is a priority at Discount Drug Stores. “We are competing with the likes of the big boxes very competitively on price, but we still offer your more convenient, traditional service. When you walk into our stores you find that traditional level of support from our staff.”

With approximately 1150 permanent, part time and casual staff there is always someone at Discount Drug Stores ready to assist customers. Staff are always professional but friendly in their approach towards customers, ready to give advice when it is needed. All staff undergo training, giving them the skills to provide customers with a pleasant instore experience. “The pharmacy has a system and staff go thorough the accreditation that the industry offers. On top of that, we offer various levels of training both in the areas of communication and retail skills. As a brand we offer those services over and above your standard industry training.”

Being a franchise organisation, Discount Drug Stores also works with individual franchise owners so that customers get the best from their local store. The company is accredited under the QCPP (Quality Care Pharmacy Program). “We have standards of the group which we apply to the franchisees to achieve the levels in quality that we and all of our customers expect… we want them to be successful as individual owners achieving their goals and by doing that we’re able to provide services to communities.”

Many franchisees choose to support a charity in the local community as a way of giving back to customers. This year Discount Drug Stores has just commenced formally supporting two charities. “One we’ve always been associated with from our franchise support office is Free To Be Kids. Free To Be Kids provides support to disadvantaged kids in India living in poverty. This year Discount Drug Stores plans to have a campaign to raise awareness for them and provide further funding through the group.

Discount Drug Stores is also pleased to be supporting Assistance Dogs Australia. The organisation provides, similar to a guide dog, a trained dog to assist people of all ages with health conditions necessitating some assistance. This year Discount Drug Stores is sponsoring its first dog through the charity and, “we also intend to, through our advertising, bring some awareness to that organisation as well.” It promises to be an effective campaign, as approximately 1.3 million Discount Drug Stores catalogues are distributed per month, along with television commercials and radio advertising. Mr Kuskopf-Dallas says that the group believes it should get behind charities that “bring some support to people in the community and improve their quality of living.”

Overcoming Hurdles

“We’re setting our sights over the next five years to reach over 200 retail outlets and that’s where we think we need to be for the next phase… we have to keep growing as a group to keep the primaries of scale.” Although Mr Kuskopf-Dallas would not rule out overseas expansion in the future, “at this stage,” he says, “our focus is purely on the Australian market. The group has its sights set on strengthening its presence in Australia’s eastern seaboard between NSW and Victoria.”

This period is set to be one of the most challenging periods that pharmacies have seen in Australia. “We’re part way through the current pharmacy guild government agreement, part of that agreement to do with the PBS,” explains Mr Kuskopf-Dallas. April 2012 will bring price reductions of between 23 to 28 per cent across the PBS (Pharmaceuticals Benefits Scheme). The Australian government will set out to achieve approximately one billion dollars worth of savings over a five year period. These government driven changes are having a severe impact in the pharmaceutical industry. Reflects Mr Kuskopf-Dallas, “some pharmacy businesses are either closing down or some pharmacies are going into receivership because of the challenges of late. We’ve had to really gear up by making sure our costs are under control… and the other challenging part of that sector is regarding our front shop business.”

Discount Drug Stores is facing pressure from the grocery sector giants Coles and Woolworths, who have been lowering prices in their health and beauty categories. The big box pharmacies are also driving prices down so there are some significant challenges ahead. “But this group has known that those challenges are coming up, that’s why we’ve been gearing up over the last five years to make sure we have all our economies of cost and scale under control.” Discount Drug Stores can provide all the support and infrastructure that franchisees need during these tough times, “so really all they need is that store level focus on providing good service to customers. We can help manage all these other challenges that they’re facing.” Mr Kuskopf-Dallas is confident that the business is in a strong position moving forward despite the current difficulties facing the industry.

There is an exciting development in the works for April at Discount Drug Stores. The business will be releasing its very own store brand of over the counter medicines in the categories of allergy relief, cough and cold, pain relief and more. 23 out of these 24 products will have been sourced from either Australia, New Zealand, the USA or UK, so Discount Drug Stores is promising even lower prices. The company is doing more than just offering everyday low prices; it’s on target in terms of growth and delivering on its goals to customers, franchise owners and the community.

Making Sense of Management

Management is the art, or science, of getting things done through people. Sounds fairly straightforward – except for the fact that people are not robots waiting to do our bidding. People have their own minds, motivations, and goals. So how do managers keep operations – and the people behind them – running as planned?

December 19, 2018, 5:14 AM AEDT