• Vira Kurdyumova

Private label in the pharmacy: who needs and for what purpose?

Updated: Mar 13, 2019

Krzysztof Siedlecki, Senior Partner ABSC, delivered a report "Private label and contract manufacturing - ambitions vs. ammunition" at the Apteki Mira 2018 Pharmaceutical Forum on May 24-25, 2018 in Odessa.

Researches of the European pharmacy market show the over-saturation of the Ukrainian market by the number of pharmacies. Compared to the nearest neighbors, the Ukrainian pharmacy earns times less (up to 5 times less than Polish and almost twice less than Belorussian) #pharmaceuticalsukraine #pharmacy, and this can not but affect profitability, pushing owners to look for alternative ways for increase of their profits. One of these ways is the introduction of private labels of goods being in high demand and having a low dependence on brands: medical devices, dietary supplements, medicines.

Krzysztof noted that the world market has been showing a tendency of increase in the number of private labels in retail for years. This is facilitated by the retail consolidation and the expansion of the discount format.

He spoke about the current state of private labels development in Ukraine and in the world. While in Ukraine the largest networks have already introduced private labels and observe the gradual growth of demand, on the global market, namely in the USA, there is a fierce struggle between private labels of the largest players in the retail market. Thus Amazon (the world's largest internet retailer by revenue and market capitalization) and Walmart (multinational retail corporation) have own lines of OTC medicines and medical products.

Ability to ensure sales volumes is the most important thing to remember for the pharmacy chain when planning introduction or expansion of the line of private label products. It will guarantee mutually beneficial relations with contract manufacturing. At the same time, the quality of goods is most probably on the first place, because the loyalty and safety of the buyer directly impact the image of pharmacy.

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