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Pharmacy 'not part' of Co-operative's future strategy

Business The sale of the 782 pharmacy branches is being considered "partially or in its entirety" despite profits rising 18 per on the year, says the Co-operative Group

Pharmacies are not part of the Co-operative Group's future strategy despite "creditable performance in a tough market" last year, the company has revealed.


The Co-operative Pharmacy experienced an 18 per cent rise in profits from £28 million in 2012 to £33m in 2013, according to annual results released by the group today (April 17).


The success was down to an increased focus on customer care and "market leading" prescription and over-the-counter sales growth of 2.2 per cent and 1.7 per cent respectively, it said.


The 782 pharmacy branches will not be part of the Co-operative Group's future strategy, despite profits rising 18 per cent last year

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However, the pharmacy business continued to suffer from the impact of government funding on medicine pricing and overall sales were down £4m to £760m last year, the Co-operative said.


The Co-operative Pharmacy's customer satisfaction index remained strong, with an average score of 93.4 per cent for 2013, up slightly from 93.2 per cent in 2012.


The pharmacy business had also remodelled 80 branches as part of its customer service-focused "branch transformation programme", piloted in 2012. It relocated 11 branches to "maximise market share" and had identified a further 20 branches to be moved this year.


Overall the Co-operative Group reported a "disastrous" year, with annual losses of £2.5 billion, after suffering the worst crisis in the company's 150-year history. The majority of the losses came from the Co-op Bank, which earlier this week reported losses of £1.3bn in 2013.


The group confirmed that the sale of its 782 pharmacy branches, first announced in February, was being considered "partially or in its entirety". "The group has decided that the pharmacy business will not be part of its future strategy," it said.


The group said it would give an update on its plans for the pharmacy business in 2014's half-year report. A Co-operative spokesperson told C+D today (April 17) that the group was still "exploring its options" with regards to sale.


Bankers have predicted that the Co-operative Pharmacy could fetch between £450m and £500m, news agency Reuters reported today.Partner at economic analysts AT Kearney, Michael Thomas told C+D he predicted American retail chains would bid for the business.


What do you think the future holds for the Co-operative Pharmacy?
 
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8 Comments

for those of you who are considering the implications of this have a look at http://www.coopconsortium.org.uk/index.php or follow @COOP_Consortium on twitter. They seem to be trying to raise funds in a "Kickstarter/Crowdfund" kind of way to acquire The Co-operative Pharmacy...

David McNaughton, Community pharmacist

selling the family silver to fund gambling debts !!

John Schofield, Locum pharmacist

HMG will certainly note that the Co-op can increase its pharmacy profits while other results are woeful.
Don't expect any generosity in any new negotiations.

MESUT OZIL,

It is not rocket science. The majority if not all of coop pharmacies are either attached to surgeries of opposite a surgery or are in a place with limited or no competition. Prescription numbers are increasing at around 2% per annum...so a 2 % rise is no big deal.

John Randell, Non Pharmacist Branch Manager

JUST KEEPING UP WITH INFLATION 1.65%

MESUT OZIL,

Sell to innovative pharmacists who will move the profession forward. I would be interested.!!!

N O, Pharmaceutical Adviser

"The group has decided that the pharmacy business will not be part of its future strategy,"

Of course, all said and done by selling the pharmacy business you can generate money to fill in the huge gap created by the other departments !!! and then continue to pay huge bonuses to the bosses for achieving this :-))

S Morein, Pharmacy Area manager/ Operations Manager

Even a poorly run organisation like the Co-Op has increased their profits by 18%.

Yet the usual suspect bleat on about contractors struggling. These people are making themselves look very silly!

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