Pharmacy Forward Thinking
With another financial year coming to an end, it is a good time to stop and reflect a little on what you have achieved this year.
Personally for me it is the most innovative time of the year. I take the time to reflect on what we achieved, our successes and our failures. Nothing is ever perfect in the world. But it allows me to identify what went wrong. Then what strategies we can employ to reverse our failures and what we can do to progress towards our goals. So with this in mind, I would strongly suggest you take the time to review and reflect.
Most importantly you have to think forward to the next year, and the years after that to continue towards your goals. This is of course assuming you have your goals and visions clearly articulated and with buy-in from your entire team. If that is not the case then that is a very good place to start
This blog is all about Forward Thinking.
Review & Reflect
Take the time to stop and reflect on what has happened. Not only this last year, but also over the life time of your business. It is a good time to do a SWOT Analysis (listing down the Strengths, Weaknesses, Opportunities and Threats).
I would strongly suggest you do this with your team and not alone. How you view the world around you is one thing, but what your team see is also very important. If your business is in a state of decline, it is even more vital you reflect, with honesty and objectivity, what is going wrong. Once this process has been undertaken, then you can now start thinking forward.
Thinking Forward 3 Years
Having a clearly defined vision should be the objective of every business. It is vital you spend some quality time with your team in mapping out the pharmacy’s vision and future. Ideally you need to have a vision of what you want your pharmacy to be in three years time.
If you are not sure how to go about this, please get in touch with me, we can meet up and I will take you through a process. But it is a vitally important process that every business needs to go through.
For pharmacy it is even more important as the industry is going through a state of change. Evolution is inevitable, you just need to choose whether you want to be a part of that evolution or watch your pharmacy erode.
I actually had a chat with my mentor Jeremy Watkins last week in regard to Peak Strategies 3 Year plan, check out below:-
Engagement with your community has to be front of mind for every pharmacy owner. Every pharmacy owner has a whole wealth of knowledge in their heads that their community needs to know about. And if you think about it, the best way to establish a loyal customer base is to connect with them on an emotional level. That means you need to engage with them.
You need to establish connections, you need to educate them and feed their thirst for knowledge and information about their health and how to live a healthier lifestyle. Are you really servicing your community by not educating them? Pharmacy owners are talented people and they need to serve their community.
A cleverly designed marketing strategy can do just that. Now if you are like me and you know nothing about marketing, then speak to our marketing manager Sarah for help.
Being in business can be a lonely existence, and sometimes we just don’t have all the answers. Being honest with yourself about what you are good at and what you are not good at is actually a vital step you must take. Surround yourself with people who compliment the areas you are deficient in. Key advisors and mentors are an important step here. This year, look to someone who can push you outside of your barriers and achieve your goals.
Engage with your accountant and have a good review of your financial systems. Your financial systems should be paperless, accurate, complete and timely. We have written quite a bit of content on this topic so please get in touch if your financial systems are not adequate and preventing you from making proper informed decisions.
Setting a budget
With all this done, your next step is to start setting a budget for next year. A proper budget will link forecast profitability to cash flow (surprising how many people don’t understand this). It should have detailed assumptions and reasoning, particularly where third parties will be using this information and should also assist with setting wage and stock purchase targets. It is a very important document and care should be taken be as thorough and realistic as possible.
Following on from the budget, are the KPI’s you should be aiming for. Those clients of ours who are signed up to our KPI/bench marking program are able to set target KPI’s and monitor these each month. You need to know what the true measures month by month are, and measure your ongoing performance against these targets. If you are off track you know immediately, then together we can sit down and adjust our strategies to get you back on the right path.
The final cog in the wheel is to have a good reporting framework in place to make sure you know how you are performing on a regular basis. As a guide this is what we would suggest;
Monthly fully reconciled balance sheet for each month year to date
Monthly Profit and Loss for each month year to date
Profit and Loss for the month comparing this month to the same month last year.
Profit and Loss Actual versus Budget
KPI’s Actual versus target versus benchmarks
Sit down with your accountant and discuss strategies not only for the current year but also for years ahead.
It is also a good time to go through a checklist and make sure everything is up to date. Talk to your lawyer about estate planning, financial planner about your financial plan and personal insurance. See here for a list you can use
We know there is a lot here, and it can be quite daunting to start this process. Get your team together and your key advisors. Take control of your business and its future.