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Branch sale and funding cuts behind pharmacy chain’s £74k profit loss

The Shackleton branch in Abergavenny is relocating to offer more services (Credit: © 2017 Google, image capture: April 2017)
The Shackleton branch in Abergavenny is relocating to offer more services (Credit: © 2017 Google, image capture: April 2017)

A chain of five pharmacies across England and Wales has attributed its £74,000 pre-tax profit loss to selling one branch, “funding uncertainty”, and generics pricing issues.

Pre-tax profit for the independent H Shackleton chain in the 12 months to October 2017 fell from £496,000 to £422,000, with half the loss due to the sale of one pharmacy in Wales, co-director Geoff Shackleton told C+D yesterday (August 13).

The turnover across all five H Shackleton branches over this period was down by almost 3%, from approximately £8.5 million to £8.25m, following “the trend [of] the last couple of years”, Mr Shackleton said.

The chain, which has branches in England and Wales, was forced to “cannibalise” its business by selling a pharmacy in Raglan, Monmouthshire last year “because of the uncertainty of pharmacy funding” in England, Mr Shackleton said.

The group now has three pharmacies in Wales as well as two in Hereford, England.

Aside from the funding cuts in England, H Shackleton’s turnover has also been shrinking because of the shift from branded to generics medicines, where potential profit has been “negated” by problems with generic pricing, Mr Shackleton said.

Relocation to offer extra services

In a push to consolidate the business after the sale, H Shackleton is relocating another Monmouthshire pharmacy, in Abergavenny, into a newly-fitted branch on the same road next week.

The new pharmacy will have a consultation and a treatment room, where it will offer travel vaccinations, Mr Shackleton said.

“We’re trying to make it an environment [that can provide] the extra services we can do now,” he added.

Welsh pharmacies in a “much better position”

Mr Shackleton said his community pharmacies in Wales are in “a much better position” than those in England, as the branches in England dispensing “below 5,000” items a month “will be very hard to keep running”.

“In England they are not promoting new services, they are quite often stopping new [ones], so it's much more difficult for us to increase any remuneration we're losing.”

“Whereas in Wales they've ring-fenced the money [for] new services. The biggest one is the common ailments service, which is now spread throughout the whole of Wales.”

14 Comments
Question: 
Was your pre-tax profit lower in 2017?

Peter Sainsburys, Community pharmacist

Hang on. They didn't lose money. They "only" made 422k this year, plus whatever they got for selling off that pharmacy!

A Hussain, Senior Management

Why would you dive right into companies house to assess how much money the business has? Abbreviated accounts don't accurately explain what's going on.  It's what's in your bank account that matters.

It's getting to the point where people won't bother helping out with pharmacy stories as keyboard warriors are just waiting ready to tear them apart.

R A, Community pharmacist

Even if they have £ millions in the bank that's irrelevant. Companies like Shackleton are a credit to their local communities and have earned this success. They pay taxes and provide a valuable service. Also, this company is quite entrepreneurial they run a successful photography and perfumery business as a sideline.    

Companies like Shackleton are the backbone of the UK Economy if they disappear the effects will be felt more keenly. If anything people should look at the tax paid by some online companies like Amazon 0.5% disgraceful these companies succeed at the cost of the little guys going broke! 

A.S. Singh, Community pharmacist

Never like to see a pharmacy close. Less than 5K becoming increasingly unviable. I hope the prospective buyer knows what they have let themselves into.

R A, Community pharmacist

Real shame to hear this! Small chains like these pay UK tax and provide far better patient accountability because of its smaller size. I hope these guys pull through. 

 

Sue Per, Locum pharmacist

Incorporated in 2005, Reserves of approx 5 million, after remuneration, and dividends, Thanks to the tax payer for a very generous pharmacy contract. and locums who are still at the rate set back in 2005. Time to claw back deep and fast and open up the markets to compete with these gang masters, rather than work for them!!!.

 

SIMON MEDLEY, Community pharmacist

yawwwwwwwwwwwwwwwwwwwwwwwn

 

Peter Sainsburys, Community pharmacist

Sue, you're well off the mark. 

Mike Hewitson, Superintendent Pharmacist

Worth reading this article when faced with anonymous C&D accounts making inflammatory statements. Where are you S Morein?

https://www.independent.co.uk/news/health/nhs-england-uk-gp-resigns-arvind-madan-online-troll-comments-a8478376.html

Kevin Hope, Superintendent Pharmacist

Shackletons are at least 5th generation Pharmacists dating back to pre 1900 do your research Sue Per!! I'd be more concerned with how Pharmacy funding is impacting longstanding businesses like theirs rather than being the green eyed monster. The way things are going there will be no Pharmacies for locums to work in, in the not too distant future.

 

 

Sue Per, Locum pharmacist

Read again, its profits are since incorporation: Try understanding the accounts, before commenting.

 

Dave Downham, Manager

No. It. Isn't.

Try understanding the accounts, Sue, before commentating.

Kevin Hope, Superintendent Pharmacist

I can smell the envy!!

Mike Hewitson, Superintendent Pharmacist

+1

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