A good friend has provided us with this article:

Atida has bought two of the three largest #pharmacy #webs in Spain.
The group will invoice a total of € 160 million.

This means that it has «bought» the equivalent turnover of some 160 medium-sized pharmacies, 0.73% of the total.  If they had been bought in transfer, the investment would not be less than € 250 million.  We do not know the amount of the operation, it will not be cheap and it is most likely that they have leveraged to carry it out.

Let’s see if, far above, the investment is profitable for us.

Being very generous, looking at the prices and discounts they handle, we will assume that the average margin they obtain from each sale is 20%, which is € 32 million.

This amount will have to subtract the cost of staff.  The article says they have a staff of 700 people.  Assuming all mileuristas and respecting the 14 annual payments are about € 13 million.  We now only have € 19 million.

You have to appear in the first place of Google searches.  As I explained in another publication, it can represent 10% of the turnover: € 16 million.

We have about € 3 million left for the maintenance of facilities, logistics costs, taxes, insurance, supplies, shareholder remuneration and debt repayment.

It seems difficult to get to all this with 1.9% of sales and that, in addition, it is enough to have a coffee ☕.

My friend tells me that they will screw the suppliers, which is the easiest.  I agree.  It is sure to be your next step.

But it would not be the first time that manufacturers have refused to serve product to those who believe that it discredits it by lowering the price too much.  I doubt that the strategy goes there.

Nor would it be the first time that, believing themselves leaders, they begin to raise prices.  But that opens the door to new competitors in price.

What suits me the most is a speculative strategy.  We have mentioned it in the case of cheap furniture and in the world of pharmacy transfers it occurs with some frequency.  It gives the appearance of success and unbeatable leadership for someone to buy the business from them and give them the benefit that they do not achieve with daily operations.

I hope I am wrong.

#BeFarmaPro analyzing the situation in the sector.

info@befarmapro.com

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