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Hi-School Pharmacy prospers in fast-changing marketplace
April 26th, 2014
VANCOUVER, Wash. – Hi-School Pharmacy may have a history founded in the tradition of the classic corner drug store, but its forward thinking has kept it expanding in challenging times.
The chain, which grew from a single store opposite Vancouver High School in 1925, added three new locations in 2013, along with eight new affiliates and continues to seek out opportunities to purchase pharmacies. But despite the expansion plans, Hi-School president and chief operating officer Jack Holt acknowledged that 2013 was not an easy year for any retailer.
“The last 12 months have remained challenging in the retail pharmacy arena,” he said. “Since the majority of our stores are in rural communities, we have not seen any new pharmacies come into our markets, but we still remain relatively flat in terms of total dollar growth — no more than 3% to 4% overall for 2013. We have seen prescription margins increase, but bottom-line dollars have slightly decreased due to increased utilization of generics.”
One of the features of the regional drug chain is that some of its pharmacies offer long-term care packaging services to meet the needs of local markets, and seven of the 34 Hi-School locations sell ACE hardware as part of their store mix.
Holt said the hardware component has been a huge positive in meeting Hi-School’s customers’ needs. “In addition, we focus heavily on outdoor plants, soil amendments, fountains and the like in many stores, which has been a good niche market for us. Moreover, two of our stores are also full compounding pharmacies.”
Among the developments in the past year has been the purchase of three new locations in Oregon. The stores are in the cities of Cave Junction, Veneta and Waldport.
Also in 2013, Hi-School contracted with Market Touch Media to provide notification to customers when their prescriptions have been sitting too long on the shelf. “We have seen good results in decreasing return-to-stocks of prescriptions,” Holt said.
Hi-School recently contracted with Pioneer RX to install a pharmacy software system as a test in one location and is still in the process of evaluation. “The work flow component, as well as the MTM med synchronization components, looks promising at this time,” observed Holt.
Hi-School has some very clear objectives for the coming year. “We will be remodeling or relocating four to five of our locations in 2014,” Holt said. “Two of the locations will see increases in square footage allocated to the ACE hardware component in their operations.”
He added that the company will seek to implement the medication synchronization programs in most of its stores.
Hi-School also expects to see continued growth of the group purchasing organization (GPO) portion of its business. “We currently have 44 stores either fully owned or affiliated with Hi-School Pharmacy Services and anticipate an additional 30% to 40% in 2014,” Holt said.
“Besides remodeling, we continue to look for opportunities to purchase existing pharmacies and join with established independent retailers in the GPO arena, as well as perhaps reentering the Vancouver, Wash., market with our retail operations. It has been over 10 years since we exited that market with the sale of my partners’ stores to Walgreens.”
Included in the expansion plans is the growth of Hi-School’s generics warehouse, in terms of the number of SKUs stocked as well as overall sales.
“Being a member of the Premier Value Alliance, a wholly owned subsidiary of the Chain Drug Consortium, continues to be beneficial in lowering our overall cost of goods,” Holt pointed out.
Hi-School places a heavy emphasis on the quality of its service to customers. As the website puts it: “The success that this company has achieved in a relatively short period of time is directly attributable to the high-quality, courteous service given to customers by the Hi-School pharmacy/hardware team.”