Offline pharmacy vs e-pharmacy: Which format is better for investing?

Are you planning to invest in the pharmaceutical business but don’t know which segment to choose?  Or have you been browsing the net to learn how to open medical store both in both offline and online format? Don’t worry we have presented here all the information you need in a simplified format.

As the COVID pandemic started, the online pharmacy business took off and proved to be a lifesaver for many. As we all know, it is one of the easiest businesses to start with low investment requirements. However, as an investor, which segment will you choose – e-pharma or traditional offline pharmacies? Let’s find out.

Why invest in Offline Pharmacy:

The offline pharmacy business is one of the most profitable segments in the healthcare industry.

  • It has been a preferred investment avenue for a long time and promises good returns. The offline pharmacy outlets have a large customer base who prefer to buy medical products from the neighbourhood pharmacy.
  • They rely more on the local chemist shop due to convenience, trust and reliability factors. For example, patients often ask the pharmacist for advice on the dosage of medicines, side effects and administration of drugs.
  • Another reason for investing in an offline pharmacy is that due to certain regulations by the government, the e-pharmacies business model has been restricted on several fronts. For example, until recently e-pharmacies were not allowed to keep an inventory and were only allowed to facilitate orders for medicines being sold by registered pharmacies or licensed distributors.
  • Also, only non-prescription drugs are eligible to be sold online. Therefore, this offers an opportunity for investors who want to venture into the pharmacy business with limited risk.
  • Offline pharmacies can be successful anywhere so it could be your best profitable business in Tamilnadu or Ahmedabad, it doesn’t matter because they are needed wherever people live. You should visit Khatabook to know about more such businesses if you are interested.

Why invest in E-Pharmacy:

  • The e-pharmacy industry is growing at a tremendous rate. However, many people are still sceptical about the idea of buying medicines online. On the same hand, a lot of people have already made the shift and prefer buying medicines from an online pharmacy
  • In the online pharmacy, customers can reach out to the pharmacy via a website or an app. But if their medicine is not available, then it is a loss of time and money for the customer. Thus, you will have to keep all varieties of medicines that they are likely to need. This means the extra cost as well as space
  • With the growing internet penetration, increasing awareness about online shopping, and aggressive discounts being offered by online pharmacies, it is becoming common for people to now prefer ordering medicines online rather than going to an offline pharma.
  • E-pharmacies provide many benefits such as a wide range of medicines across categories, doorstep delivery, and round-the-clock availability. They are also easier on the wallet because of discounts and offers on their products. However, they still have a long way to go in terms of market penetration due to various reasons such as a slow adoption rate among elderly people who constitute a major chunk of the population requiring medicines regularly, low level of awareness among others.

Final verdict

Even though these companies cater only to prescription drugs (which are otherwise only available at brick-and-mortar stores), they are not yet profitable due to high levels of discounts and cash burn for acquiring new customers. It remains to be seen whether the e-pharma industry can sustain its growth momentum with competition from local pharmacies and large pharmacy chains that have also started selling medicines online.

Read Also: 8 Health Benefits of A Low-Carb Lifestyle



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