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Sector economics once favoured steady branch acquisition – but Surrey contractor Sunil Chandarana says ‘growth’ now means maximising your existing pharmacy

Sunil Chandarana didn’t always dream of following in his father Shashi’s footsteps as a pharmacist. Shashi bought May & Thomson Pharmacy in Woking in 1982, and while Sunil grew up pitching in along with his mother and sister, he saw a future for himself as an accountant.

But shortly after accepting a place on an accountancy course at City University, the young Sunil had a change of heart and managed to get a place on the University of Sunderland’s MPharm course intake starting that September.

What prompted the rethink? “I think the idea of working in a business and meeting people just excited me a little bit more; I felt I could do more with my skill set. Dad was shocked.”

He hasn’t looked back since then, working as a locum before taking over May & Thomson in 2010. The strongest pull is still the opportunity to make a difference locally; Sunil says that eight year’s after his father’s passing, patients still approach him to say what a positive impact Shashi made. And it is still very much a family business, with Sunil’s pharmacist wife working alongside him.

In addition to May & Thomson, Sunil has owned a pharmacy in Dartford for the last 12 years – but says he would “think long and hard” about buying another store. “It’s a little bit tougher now to expand,” he says, adding that with him living in North West London and owning pharmacies in Surrey and Kent “the geography is not ideal”.

“My viewpoint is, if you’re going to do it you have to be really careful before expanding. You’ve got to make sure all your processes are in place and you build branch by branch, because as we’ve seen from what happened with LloydsPharmacy by not doing that.

“You have lots of variables that can go wrong: stock levels, service levels, and we’ve seen subsequently when independents have taken over the Lloyds branches how well they have done.”

The economics were once on the side of contractors wanting to steadily grow their footprint, but for Sunil growth “now starts with the value of each pharmacy... a second or third site only makes sense once the first is genuinely worth owning”.

He adds: “There’s always room for expansion, but I’m of the viewpoint that you can’t just buy it and leave it. Perhaps a few years ago you could; the dispensing model was fixed and there was less incentive to do any more work than what was necessary. You could just get a locum in for the day and be fine. Now it’s harder in terms of what you can do.”

So what levers can a contractor pull these days to make the business work? Sunil replies: “You have to look at your service offering and what your competitors offer – and where there is a genuine gap in provision try to fill it.”

New premises ‘a leap of faith’

Just over a year ago, May & Thomson relocated from its previous “tiny” 800sqft shop to one that’s just over 3,300sqft in what Sunil calls “a leap of faith” and a springboard to a new way of working.

He says: “When we got this space I did as much research as possible, went out to see as many pharmacies as I could to see what we could do with that space and how we could expand our offering.”

There is a “huge” dispensary with a well-used robot. “We went to around 25 pharmacies and saw different robot systems and PMRs and brought those ideas back to our pharmacy.”

“It’s not all been brilliant,” he says. For example, a flood badly damaged one of the six consultation rooms about five months in, necessitating a second refit.

And some services haven’t taken off first time around. “In our previous pharmacy we offered phlebotomy and the service just didn’t work, but now it’s much busier. We’ve learned all the lessons and now offer bloods again – we’re doing two or three a day and it’s getting busier.”

Investing in six consultation spaces has overhauled the pharmacy’s way of working, with dedicated rooms for aesthetics, ear microsuction and other private and NHS services, as well as one room rented by a local osteopath.

“It’s more of a clinic than just a pharmacy,” he says. “The whole way we work has a shifted, the pharmacist is now in the consultation room 95 per cent of the day.”

Much of the redesign’s success has been down to accuracy checking technician Helen, says Sunil. “She designed that pharmacy, she knows everything about it. She's absolutely fantastic.”

Moving to automation hasn’t been about reducing headcount, but helping staff focus more on services, he says. “They’ve been repurposed. One staff member had worked in a nursery before, and in her first year has done all her courses and now takes bloods – she’s better at it than most people, she’s so calm with patients and she gets blood every time.”

New services can take time to bed in, and advertising is key. “In Dartford we launched cryotherapy and it was unbelievably slow for the first six months. But then as word starts to spread and people start to hear about it, it's got busier to now it's at least once a week, and the profit margin for it is really good.”

I note that the pharmacy’s social media accounts promote free prescription deliveries, something many contractors have dropped due to the service not being economical. Has there been any internal debate about whether to maintain this offering?

“It's obviously not cost effective to be doing that, but we have provided this for a long period of time for our customers. There is a level of cost for the pharmacy, but there's also a level of loyalty to the patients and we know that some of them genuinely struggle to go out.”

The needs of his patients are clearly close to Sunil’s heart. Are there any interactions that stand out? “There’s one gentleman I remember. He came in on a busy Monday night – I think I was only a few years qualified – and he was hovering by the Gaviscon area for ages. Something just didn’t seem right.

“I asked was he OK, and he said he had really bad heartburn. He was already taking lansoprazole, and I wondered why it was so severe. On questioning him, I thought, this is a lot more serious than heartburn – you need to be referred.

“We called an ambulance and he went off to the doctor's. It turned out he was having a heart attack. He’s absolutely fine now, and I’m so glad I had the opportunity to speak to him.”

Prescribing service not currently worth it

Of his future plans, he says: “The main ambition is just to develop what we're doing and really have some innovative services that benefit patients in a wider area, not just our immediate area.

What sense does he get from speaking to other contractors? “I speak to a lot of pharmacy owners. The ones I’ve met since joining the Independent Pharmacy Contractors’ Network include really young guys who are buying shops all the time and are extremely motivated. They’ve gone from 3 to 7 shops in a year, they’ve got great systems and use a lot of IT; they’re very data driven.”

“I think everyone's starting to realise the NHS is tougher, so they're starting to pivot a little bit more towards private,.

“I refuse to think it's doom and gloom. I think there are lots of opportunities to do well and thrive probably use a wider range of skill sets than before.

Pharmacy First performs well, particularly since investing in educating GPs and patients about the service. “We've made sure in every single prescription bag that goes out, we put pharmacy first labels. Now, we comfortably hit our 30 a month and we try and aim for 60 or 70.”

However, he is dubious about the prescribing service set to launch imminently. “Financially it’s something that needs to be looked at thoroughly. They’re asking for pharmacists to prescribe as an IP – but the remuneration is the same as a PGD, only with a lot more liability. It doesn’t add up.

“And I've spoken to a lot of pharmacists who believe the same. They're not going to be doing the service because the additional IT costs are in the hundreds of pounds while the reimbursement difference is negligible.”

“It’s important for pharmacists to undertake these NHS services, but this one I just don't think is viable.”