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Australian Journal of Pharmacy : November 2006
retail management causes are? Think about it: I think any, or all of the following, are possible: 1.There was no discussion about what the acceptable lines per transaction number should be in each category— no goal was set. 2.There was insufficient commitment sought or given on how to get there. 3.Maybe the team leader or owner never thought about it nor the impact on sales (not to mention customers getting the right solution). 4.Out of stocks, or making a decision not to use multiple facings. 5.Lack of impact or stock density of add- ons. 6.Not using the appropriate customer engagement model. 7.Not using the appropriate shelf talker or discussing what its purpose is. 8.No, or insufficient, counselling by the team leader on meeting the behavioural expectations set up by the FeelGood system. FeelGood has rigorous and demanding training requirements, but what happens in other businesses where these require- ments don’t exist? You know what they say about leading a horse to water? In the UK, only 14 per cent of all dispensary items have more than the script lines sold. In other words, 86 per cent of the sales are straight out orders for only the one item/s that were written on the script. No wonder there has been defection to the supermarkets! If no attempt is made to give a total solution, why bother pay- ing more than you need to? What would you do if you were the customer? How would you feel? There aren’t short cuts. No ‘merchan- dising system’ alone can drive up sales to the level where customers are thrilled by the solutions they get from their local pharmacy. This will always be up to what the pharmacists and staff recommend. Being nice isn’t enough. Delivering what the customer wants and needs is really the only way. Brian Walker, in his excellent review of customer behaviour in Inside Retailing, October 2006, makes the point that cus- tomers have no qualms shopping around, and will really only go out of their way or travel further if the offer they receive is unique, relevant, interesting, tailored for them, special. If that were the case in pharmacy, the lines per transaction would demonstrate much of the story. It would provide the evidence of successful solution offers. How to establish your magic number So how do you establish what your lines per transaction should be? 1.Take specific categories and sub- categories, rather than the business as a whole. For example, what solution bundle does the mother need for colic, as opposed to rash? Are there any other things she should do, have, use that would generally make her life easier, and her mood better? What about the impact on the rest of the family, her partner? 2.Determine the lines per transaction for each solution bundle; it will always be more than one item. Have a serious team discussion about a sensible goal, set it, measure it, and review performance against it. 3.As a group discuss the most realistic approach of how to present the total bundle. What will you say? When will you say it? How can the positioning of the merchandise assist? Does it need shelf talkers to assist? Window displays? A special promotion? Lectures at the pharmacy? Special loyalty offers? Ends? Window treatments? 4.Are you in stock of all the items? Are you a buying agent for the customer? Can you deliver the total solution? Is it obvious, does it have high impact, is the stock dense and accessible? 5.Set up some challenges to add on to core items. How often have you recommended calcium, some rescue remedy, a stress ball, some stress reduction tips, maybe your weight loss program if appropriate to women collecting their script for HRT. That will lift your items per transaction, your sales and your profit, but not necessarily deliver vital solution advice, 66 ? THE AUSTRALIAN JOURNAL OF PHARMACY VOL.86 NOVEMBER 2006 which will ensure your customers want to return to you because you deliver everything they want and need. Why not consider putting a senior front-of-store staff person to have the responsibility for the point-of-sale and the assessment of lines per transaction. That will encourage more responsibility and accountability in the front of store, and create an awareness of how productive staff members and the merchandising is. But the issue is no longer about selling only one more item (although it would help sales and profit). Today, with com- petitive price pointing, the real challenge is getting your customers to prefer dealing with you because of the value they get from you—not in price terms, but in adding value and quality to their lives. The bottom line It’s no longer enough (even though it’s vital) to employ warm, pleasant and mature people; it’s no longer enough to have great levels of product knowledge, even though that’s vital too. It’s definitely not enough to have a great looking store. To differentiate yourself, be relevant and interesting, you must give customers everything they want (ask for) and need (which they may not realise). One of our FeelGood pharmacies— even though they have made all their first year’s FeelGood costs back in profit terms within five months—is undercooked (according to my lines per transaction count) by $111,000 in sales over this first five months. Another, who has not yet done the training, is more than $50,000 underdone in the three categories they hold. And it goes on. There is a pot of gold at the end of rain- bow. The potential is huge. Everyone needs to make the time and effort to get there. Business performance improve- ment that sustains over time won’t hap- pen if, as Peter Sacassan often says, we do what we’ve always done and hope to get a different result. What everyone needs to do is stop hop- ing for a miracle to switch on the sales, and move from talking the talk to walking the walk. ¦