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Lloyds chief: Why pharmacy needs urgent business rates reform

"We are being forced to remove vital services from communities"

Amid funding challenges and Brexit uncertainty, the CEO of Lloydspharmacy's parent company explains why keeping healthcare accessible will require reforms

It is a turbulent time for British business. We still don’t know what will happen with Brexit. The planning for a potential ‘no deal’ requires significant management time and, in many cases, investment in stock, warehousing and changes to systems and processes.

The regulatory burden is substantial and, if your business model happens to include retail outlets, you’re also facing attack on other fronts – unprecedented change, declining footfall and a need to develop digital solutions.

Community pharmacy is not immune to these external market factors. Like all businesses supporting local communities, we face numerous challenges, but we also have additional issues to deal with, such as the Falsified Medicines Directive (FMD), the vagaries of category M, and a contract that is in urgent need of reform.

We provide a unique and vital service to the community as a major contractor to the NHS. Thousands of people rely on ready access to our healthcare professionals every day without appointment. The continued high level of business rates makes the marginally economical service of dispensing prescriptions even more challenging.

Government funding cuts to community pharmacy have prompted us to tackle market changes head-on with around 70 Lloydspharmacy closures. Our competitors have now acknowledged that keeping their bricks-and-mortar sites open is becoming more and more challenging.

We are being forced to remove vital services from communities at a time when our NHS is under more and more pressure from people who are living longer, and people who have long-term conditions.

We urgently need to reform this outdated taxation to provide accessible healthcare as well as to preserve our urban landscapes. Let’s not forget that when retailers go out of business, they pay no tax at all. How does that benefit the economy?

Toby Anderson is chief executive of Lloydspharmacy’s parent company McKesson UK

3 Comments

Dean Hawkins, Secondary Care Nurse

The other reason for lloyds potential business losses are its ridiculous non-sale of goods tactics when patients want to buy ,as someone in the NHS myself and as a customer the number of branches where a customer presents and this is-not your local common or garden drug addict, but serious customer, elderly person, middle aged suit, person seeking a minor ailment and told we can't sell you it is beyond ridiculous. A young girl of 20-odd turned away for Senokot (for fear she might be a hidden anorexic and taking laxatives to lose more weight,though she looked more than well proportioned), people barking with colds turned away for night nurse, sudafed,benylin drowsy  for fear of getting a kick out of it or setting up a crystal meth factory on one box of sudafed,God forbid. Even I was refused a bottle of J Collis Brownes after seeing it for the first time in years and just wanting a bottle to keep in the cupboard for the time i have a dodgy stomach.Their non-sales tactics are a total nonsence.

Leon The Apothecary, Student

You would love one of my original Pharmacists growing up who'd freak out every time I was about to sell an old lady some citric acid power so they could make elderflower cordial. I'm pretty sure Mrs Doris isn't about to start shooting up some of the backstreet's finest heroin.

Sue Per, Locum pharmacist

We are being forced to remove vital services from communities at a time when our NHS is under more and more pressure.

What vital services are unique to Lloyds??, Sell up to a more eager and hungry potential proprietors, at realistic goodwills, or at reverse premimums, and the vital services and more will remain offered to the communities that Lloyds cease to offer. Lloyds is replaceable!! 

Lloyds pharmacy was “prompted to tackle market changes head on”, by closing “around 70” branches, he added. C+D has identified 78 Lloyds pharmacies deemed “commercially nonviable” that have closed, and another 104 have been sold, since October 2017.

Fact:Managed to sell of 66% with good premiums, to those who were happy with lower profits or margins. If you reduce the exorbitant management costs extracted from these units, they would certainly have been profitable.Easy solution, executives need to take a pay cut, and work as fast and efficiently as their pharmacists!!.

Further, the "closures" was merely a consolidation exercise, post acquisition, which usually happens. The first signs of tough trading conditions in a sector would be evidenced, with mass closures. not a mere sub 1%, that we have witnessed!!

Let’s not forget that when retailers go out of business, they pay no tax at all. How does that benefit the economy.

If Lloyds goes, their market share will re distribute amongst other providers of the service, and most of the job losses will possibly be filled by uptake from the exisiting network to cope with the extra demand, but more importantly, if Lloyds sell the pharmacies, because they are not as profitable as they would like,  then they will in all probability be taken up by many young pharmacists eager to be come proprietors, and will be determined to succeed!!.

 

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