Running a pharmacy is now a lucrative venture.
Janell Karanja, a lab technician and entrepreneur who graduated from Kenyatta University with a degree in Medical Lab Science, shares her secret to success with The Standard.
What does it take to venture into this business and how much capital does one need to have?
The requirements that one needs to have to open and operate include the registration of the pharmacy with the Pharmacy and Poisons Board. A certified pharmaceutical technologist must carry out the day to day activities of dispensing the drugs.
You need expert advice. This includes an attorney who understands the business. The attorney will set up the business's legal status, and advise whether to establish it as a sole proprietorship or limited liability corporation, as they both affect the finances and operations of your pharmacy.
Secondly, you need to develop a business plan. Analyze the population of your target site and gauge if there is a large enough population to support your pharmacy. Understand your customer needs by engaging with community members about what they want.
Familiarize yourself with the market opportunity by understanding where the business currently stands from a performance standpoint, and its five-year plan. You also need to think about how to improve patients’ medication adherence because it is a key factor in the future success of your pharmacy.
Choose a great location for your business. On opportunity, are there medical facilities that will provide a constant flow of potential customers? Visibility: will people notice your pharmacy without obstructions? Access - what are your entry and exit restrictions? Size: can your pharmacy grow in the location?
Finally, you also need three types of funding to start up a business: buildout capital - payment of the lease, payments of licenses, renovations, fixtures and other fixed assets. Opening inventory financing – to pay for initial products to stock up your store and working capital for day to day operations.
I used around Sh500,000 as my startup capital.
In terms of licenses, which government agencies must one have approval from before they commence setting up an enterprise?
Registration certificate for the premises is from the pharmacy and poisons board. An annual practice license is applied for by a registered pharmacist or a pharmacy technologist.
What kind of storage facility does one need to have to cater for drugs storage?
There are different types of drugs; there are those that require storage under room temperature - these should not be stored under 15 degrees. Some require refrigeration, and the temperatures should be between 2-8 degrees.
How often do you use digital lenders to cushion your business?
If the need arises, and I have an urgent order of drugs for customers, but have no money, I take a quick loan and get the drugs for my customers and offset the debt as soon as the client pays for the drugs.
Why do you think most SMEs today prefer borrowing from digital lenders as opposed to financial institutions?
Borrowing money from financial institutions involves a very tedious process. You have to physically go to the bank, produce financial statements and source for guarantors. It then takes days for your loan to be approved. With many digital lenders, you just download an application and request a loan. This process takes less than 10 minutes, and within a very short period, you already have the money with you.