“I don’t have time to forward dispense!” vs “I don’t have time not to!”

The KordaMentha Industry report of February pulls no punches (ref 1). Retail pharmacy industry is in a maelstrom, due largely to the twin forces of the discounters and PBS reform.  One of the numerous recommendations, all too clear and oft reiterated… community based pharmacy must reinvent to a forward dispensing service model to survive and thrive.

There is documented evidence dating back twenty years (ref 2) at least, suggesting that forward dispensing has been described, even exhorted in Australia, for a generation now.  In current times, there is anecdotal evidence to suggest that the burning platform is focussing renewed interest in forward dispensing.

It seems to us, at The Next Level, as we roam the countryside scoring and benchmarking customer engagement effectiveness and script processing efficiency at the dispensary, that there are those pharmacists who have heard about forward dispensing, but are either scared, ignorant or both, and have not attempted execution. Or attempted feebly once or twice and retracted to the comfort zone at the back of the dispensary.  Often their perception is “I don’t have time to forward dispense”. Conversely, there is a growing number of pharmacists who have attempted   and successfully embedded the processes and practices accordingly, a smaller number still have mastered it.  Often, the perception of these pharmacists is “I don’t have time NOT to forward dispense”.  Funny conundrum, huh?

We have had the pleasure of observing a number of such models in action, and have come to the conclusion that there is no ONE forward dispensing model.  There are numerous.  And the variations on the theme seem to follow some sort of Darwinian evolutionary progression.  More about that later.  Numbers before words… let’s look at the stats that represent the current level of customer service for the health customer at the dispensary.  For the first time on the Australian retail pharmacy landscape, very specific data has been collected from real time observation at some 115 mid to large sized community based pharmacies – all states; all major cities/towns. A representative sample of this type of pharmacy at large.

The benchmarks that represent the level of service provided by “mainstream mid-large community based pharmacy” to health customers across Australia

  • 48% of customers stay at the dispensary for the duration of their dispense… more than half go “to do the shopping” to return later, either by their own volition, or because staff invited them
  • Regardless of this scenario, the script bearing customer spends on average 4m 52s at the dispensary for their dispense
  • Of this time, 49% (2m 22s), is spent engaged by members of the dispensary team… more time (2m 30s) is spent disengaged, standing in queues or waiting
  • Perhaps more sobering, is that of the 2m 22s engagement, only 38s on average is invested in proactive medicines or health counsel administered by the dispensary team, the rest is counsel in response to the enquiring customer, or just idle chit chat and other value neutral engagement
  • Regardless of proactive counsel duration, the benchmarks show that 48% of script bearing customers receive some proactive medicines counsel … more than half do not
  • It takes, on average, 4m 16s to process ONE script item, less than half that time (2m 2s) is invested on processing; more than half (2m 14s) processing is stopped, in suspended animation, waiting for a human being to (re)start
  • More than half the time (53%), the Pharmacist is stationed with at least one counter, often two, away from the customer at the rear undertaking the lion’s share of manual processing
  • The average script customer “companion sell” ratio is 17 – for every 100 script customers, 17 non-script health category products are sold
  • The average non-script health customer “basket size” ratio is 116 – for every 100 such customers, 116 non-script health category products are sold

The same data providing these benchmarks, also allows for correlation strength to be tested at the behavioural and commercial levels.

The correlations that paint the dual picture of the problem and the opportunity for the industry, against the backdrop of downward pressure on profitability

  • Create a compelling value proposition to keep your customers at the dispensary for their dispense, the correlations demonstrate that high performance here leads to longer engagement, shorter processing time, and higher frequency of administering proactive medicines counsel
  • Speaking of shorter processing time, the correlations demonstrate that minimising rehandling (so-called “straight through processing”) and reducing “white space” (idle time) are the keys
  • Speaking of longer engagement time, the correlations demonstrate that longer engagement time DOES lead to longer proactive counsel provision, regardless of any extended chit chat time
  • Back to the notion of forward dispensing, the correlations demonstrate that pharmacies that position pharmacists in a more forward orientation at the dispensary counters, are more likely to deliver longer proactive counsel to script customers

So far, so good.  Now we have data to support the practices and processes exhorted by industry peak bodies like the Guild and PSA.  Now comes the twist in the tail.  As we move from these behavioural correlations and search for their alignment to commercial correlations, the picture becomes very mixed.

Come back next month as this topic is to be continued!

Visiting The Next Level’s website can help put this discussion in perspective. Or, simply send us a message via the Contact Us section and we will gladly answer any questions you may have or organise to come out and have a discussion as to what The Next Level Sales System can do for you and your business.