The average gross profit margins of Welsh pharmacies sold are the highest in 10 years, according to a new report on the Welsh pharmacy market.
A report by pharmacy sales specialist Hutchings, shared exclusively with C+D, shows gross profit margins of pharmacies sold by Hutchings in Wales have “remained strong” and there has been a year-on-year improvement.
After increasing from 32.2% and 32.4% in 2024 and 2025 respectively, gross profit margins are now at 34.1% in 2026.
Read more: Buying + Selling: Hutchings UK market updates, Cohens acquisition and Scottish market exit
Hutchings associate director Paul Steet told C+D this is “higher than anticipated” and the highest average seen for the last 10 years in Wales, and above the UK average of “30 to 32%”.
Hutchings’ report said pharmacies have shown their “resilience” in a challenging sector marked by rising costs, medicine supply and reimbursement pressures by improving “purchasing strategies”, using “buying groups” more and focusing on “services-based income streams”.
“This positive trend reflects the sector’s ability to adapt to a challenging operating environment and implement strategies that protect and enhance profitability,” Hutchings said.
South Wales
The report said pharmacy buyer interest in Wales has remained strongest in the “sought-after” south, with 85% of its completed sales in the area across 2025 as it “continues to attract strong buyer interest” in the sector.
Steet said it is a high demand area because of pharmacies location “within or close to the M4 corridor between Swansea and Newport” that have larger populations and are “more accessible by transport”.
He added there is a higher number of pharmacies in South Wales and a “greater range of potential buyers both within Wales but also from across the border in England” too, with that interest continuing into this year.
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It followed a “significant increase” in seller instructions over 2025 with “strongly performing” corporate and multiple pharmacy disposals representing 90% of Hutchings’ sales.
This led to a 68.7% increase in the average turnover of pharmacies sold to £933,235, but Hutchings said this higher turnover meant fewer offers were received per sale, with three per pharmacy, compared to five in 2024.
“Their larger scale, turnover, and subsequent higher goodwill valuations reduced affordability for many potential buyers,” it said.
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Hutchings associate director Paul Steet told C+D the higher average turnover of pharmacies up for sale were “out of the financial reach of most first-time buyers who make up the bulk of the buyers in the market”.
“Many first-time buyers generally might purchase a pharmacy with a turnover between £300,000 to £750,000,” he added.
Group owners accounted for 62% of the buyers of pharmacies sold in 2025, with first-time buyers making up a third, and independents just 5%.
2026
These buyers all have an equal third split of pharmacies sold so far in 2026 in the Welsh market, as Hutchings said sales have returned to “typical levels”.
The average turnover of pharmacies sold so far in 2026 was £591,500, significantly lower than the 2025 peak but 6.9% higher than the 2024 average.
Read more: January 2025 market update: First-time pharmacy buyers rocket as GP investors enter the market
Over 65% of these completed sales have been in the “traditionally lower” demand area of West Wales, which is more remote and rural.
The brokers said even though there has been “more affordable goodwill asking prices”, the interest and competition for buying have “remained slightly more subdued” compared to previous years, with two offers per sale this year.
Value
The increase in corporate and multiple pharmacy disposals in 2025 created a “downward pressure” on independents selling as the increased availability of pharmacies “diluted buyer focus” and “increased competition for attention”.
But independents still achieved a higher pence in the pound than corporates.
High-turnover corporates achieved “stronger than anticipated” goodwill values, but low-performing branches attracted “much reduced” goodwill values.
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With independents being involved in more transactions in 2026, Hutchings said this has increased both the upper and lower end of goodwill values achieved across the market.
It is now at a heathier £0.46 to £0.85 average in the pound, after a £0.24 to £0,80 average in 2025 and £0.39 and £0.75 average in 2024.
Outlook
Steet said buyers are looking at pharmacies that can “demonstrate both sustainable dispensing income and clinical growth potential”, suggesting investment into independent prescribing and digital innovation will create opportunities for pharmacies to diversify.
He anticipates the transaction levels to be “steady” over the next year and that independent sellers are “likely to account for the majority of pharmacies brought to market and small to medium-sized pharmacy groups remaining the most active acquirers”.
“Provided borrowing costs remain relatively stable and there is no significant increase in corporate disposal activity, goodwill values are expected to remain broadly consistent, supported by resilient demand and confidence in the sector’s long-term prospects,” he said.
It comes after Hutchings predicted independent sellers will “dominate disposals” in Scotland this year.
Last year it revealed seller instructions by pharmacy owners rose by 91% in 2025 compared to the previous year.
