How to take advantage of increased spending over the holiday season and offer value to customers in the pharmacy
End-of-year holidays can provide a profitable albeit stressful time for retail staff.
Pharmacy owners can look forward to increased sales but also longer working and opening hours.
Christmas spending will have a positive impact on the retail business sector but it will be short-lived, warns Associate Professor Dr Shumi Akhtar from The University of Sydney Business School.
“The sudden profit increase is a temporary positive shock. While this influx of festive season spending spree will make the retail sector look good, the retail sector must be aware that the expected downtime in the coming months ahead.
“This is because of people often go away and also most will be dry on spending… Not to mention the returns of items because gifts and presents are not to the recipient’s liking.”
Dr Akhtar says pharmacies may observe a slight rise in sales during the festive season but not as much as the big retail stores because they do not carry as many product lines or brands.
“The public goes to pharmacies to buy drugs in the first instance and buying gifts/beauty products is just a matter of convenience. Hence, the profit may increase but perhaps not be as high as other retail stores,” she says.
Pharmacy owners can be smart about the holiday season in order to harness the increase in spending for gifts, says Dr Akhtar.
She suggests pharmacy owners should:
- Carry the most popular brands of cosmetics and beauty products;
- Offer some extra incentives to attract customers: for example, additional discount or loyalty points or complimentary gift vouchers for tea/coffee if the waiting time is long;
- Time the discount/reduced price e.g. offer discounts earlier than the retail giants;
- Extend opening hours; and
- Offer wrapping services free for those who buys products in store, and at no (or minimal) charge to pensioners/elderly people who would remember the service and perhaps return again.
Dr Akhtar conducts research into corporate finance, asset pricing, risk management, capital markets, market efficiency, behavioural finance and more.