The majority of people working in independent pharmacies who are responsible for or have access to the finances of their pharmacy said their business saw a growth in turnover over a 12-month period and most expect that trend to continue over the next year, according to a survey by CIG Research.

The findings of the two-week online evaluation of independent pharmacy businesses, which may come as a surprise to many within the independent pharmacy sector given its well documented struggles with funding cuts, revealed 60 per cent of 215 respondents oversaw their pharmacy’s finances and of that proportion, 62 per cent reported growth.

More than half of those surveyed - 53 per cent - were independent pharmacy owners, seven per cent were supervisors and 36 per cent were pharmacists.

Of the 215 independent pharmacies that took part, 48 per cent were single outlets, 27 per cent had two to five branches, nine per cent had six to 10, 10 per cent had 11 to 20 and six per cent had 21 to 49 outlets.

During the survey, which took place in February this year, 26 per cent reported a decline in their turnover over the last 12 months and 13 per cent saw no change. The average across the sample was a 3.8 per cent growth in turnover but the study noted that this was in a year when the consumer price index rose by four per cent in the UK.

Independents were also optimistic about the short-term future, with 60 per cent saying they expected a growth in turnover in the next 12 months, while 22 per cent predicted a decline and 18 per cent expected to see no change. The study said the average growth in turnover across the sample was expected to be 3.1 per cent.

“The latest forecasts for inflation in 2024 are three per cent, so this is a slightly more optimistic outlook than the last 12 months have been for independent pharmacies,” it said.

Concerns about independents’ profitability

However, independents were less optimistic about their prospects of generating a profit. Fifteen per cent of a sample of 101 respondents said they had “been in loss” in the last year and 24 per cent said they would lose money in 2024. An average of seven per cent reported profitability over the last 12 months and the study noted “the forecast profitability for those reporting expected profits will be 6.5 per cent.”

Thirty-nine per cent of a sample of 84 made a loss or only broke even in the last year and of that, 53 per cent cut staff costs, 47 per cent used their private savings or investment to support their business, 37 per cent had taken out a bank or finance loan, 37 per cent had extended their business account overdraft and 21 per cent borrowed money from friends or family.

Two-thirds of those who went for a loan said their bank was not supportive. Of the 37 per cent who took a loan, 24 per cent agreed with the statement ‘we have been turned down for a commercial business loan’ while just six per cent disagreed.

Forty-one per cent agreed with the statement ‘we have secured financial support but on disadvantageous terms’ and while just six per cent disagreed.

Thirty-six per cent agreed with the statement ‘we had to provide personal security guarantees to secure commercial finance’ and again, six per cent disagreed.

Sourcing medicines ‘has never been harder’

When it came to assessing the challenges facing their pharmacies in the next 12 months, 85 per cent of 215 respondents agreed that sourcing prescription and over-the-counter products has never been harder while 84 per cent said they routinely make a loss when dispensing prescriptions.

Eight-four per cent said wholesalers could do more to support pharmacies and 79 per cent said they cannot “progress the government’s clinical services agenda under current funding arrangements.”

The same proportion said recruiting and retaining staff was a “major issue” and 66 per cent said unless there is “a significant change” in the way their pharmacy is funded, “there is a chance” it will go out of business.

The study said the mean confidence score on a scale of 0-10 about the financial success of independent pharmacies in the next 12 months was 4.5.

The research also revealed 82 per cent of 215 respondents use locums and 20 per cent use pharmacy technician locums. Eight-four per cent said the main reason for using locums was holiday cover and staff absence, 31 per cent said it was because they were struggling to recruit permanent staff, 29 per cent said it was down to extra workload and 24 per cent said it because of the need to deliver advanced services.

The mean amount pharmacists were prepared to pay for locum pharmacists was £29.32 an hour. Eleven per cent said they paid locum pharmacists less than £25 an hour, 43 per cent paid £25 to £29, 32 per cent paid £30 to £34, seven per cent paid £35 to £39 and six per cent paid £40 or more.

Concerns over staffing and time when offering Pharmacy First

Independents were fairly split when asked if NHS fees for Pharmacy First and other clinical services are “about right,” with 39 per cent disagreeing and 33 per cent agreeing.

Almost half of respondents - 47 per cent - thought there was no time in the day to offer Pharmacy First/clinical services while 28 per cent thought there was.

Forty-nine per cent said they do not have enough staff to offer Pharmacy First/clinical services while 22 per cent thought they did. Fifty-five per cent said they would only hire pharmacists/locums who are willing to provide Pharmacy First/clinical services while 15 per cent said they did not agree with that approach.

A big majority of 72 per cent said they saw Pharmacy First and clinical services as “a key part” of their revenue and profit while just nine per cent did not.

Single outlet independents employed on average 1.5 full-time equivalent pharmacists, 1.7 technicians/accuracy checking technicians, 2.1 dispensing assistants and 1.8 medicines counter assistants.

Chains of 2-49 outlets with an average of 9.7 outlets per chain averaged 2.1 pharmacists, 1.9 technicians/ACTs, 2.0 dispensing assistants and 2.2 MCAs per outlet. The majority of respondents, 56 per cent, said staff numbers have not changed in the last year, while 23 per cent said it had increased and 21 per cent said it had fallen.

The study also looked at independents’ attitudes to clinical services. Eighty-five per cent of 215 respondents said they offered Pharmacy First and 91 per cent have registered for it.

Eight-one per cent and 61 per cent provide flu vaccinations and pharmacy contraception services respectively. Only 11 per cent said they offer stoma appliance customisation, nine per cent appliance use reviews and nine per cent hepatitis C testing. Twenty-six per cent said they offer independent prescribing.

Over the next 12 months, 53 per cent said they plan to offer Pharmacy First, followed by flu vaccinations (52 per cent), pharmacy contraception (47 per cent), hypertension case-finding (44 per cent) and independent prescribing (40 per cent).

Eighty-seven per cent of respondents said sore throats will be the condition seen most under Pharmacy First this year, followed by uncomplicated urinary tract infections in women (85 per cent), sinusitis (67 per cent), infected insect bites (53 per cent), impetigo (43 per cent) and acute otitis media (47 per cent). The study noted shingles treatment was “not considered to be a frequently used service.”

The study also got responses from a sample of 101 independents about prescriptions. Thirty per cent said they dispensed more than 10,000 a month, followed by 12 per cent (7,000-10,000), 21 per cent (5,000-7,000), 30 per cent (3,000-5,000) and nine per cent (less than 3,000).

CPPE training used by 73 per cent of respondents

When it came to training, 73 per cent said they used resources provided by the Centre for Pharmacy Postgraduate Education, followed by The Pharmacy Network (60 per cent), elearning for healthcare (53 per cent), in-house training (52 per cent) and the National Pharmacy Association (37 per cent).