Surya Healthcare – the retail and distribution subsidiary of the Rs 1,600 crore Surya Pharmaceuticals, which runs a chain of pharmaceutical stores called Viva – has plans to hit the 2,000-store mark in India by 2015.
Rajiv Goyal, Chairman and Managing Director, Surya Pharmaceuticals, said: “By 2015, we aim to be the largest pharmacy retail chain across India with 2,000-plus stores through a combination of company-operated and franchised outlets. We plan to invest in excess of Rs 500 crore for this.”
Talking about the USP of Viva stores, Goyal said: “The USP behind the Viva chain-store retailing is to provide people with a ‘one-stop-shop solution’ to all health needs through a large network of retail outlets with a focus on fulfilling preventive, supportive and curative needs of an individual and the society at large.”
Goyal added that the key challenges which Viva continues to face in the Indian market are a lack of low-cost retail locations, regulatory conditions which need an assessment and a complete re-do of some of the laws, high attrition among staff both at the front and back-end, price control on drugs, unscrupulous practices of undercutting, discounts in general trade, changing disease profile leading to stocking of too many medicine brands, unfriendly GST environment and no tax benefits.
The company claims to have over 1 lakh Health First card members. They contribute about 40 percent to its overall sales, Goyal said. Through this card, Viva provides benefits to customers such as access to low-cost health camps, discounts at channel partners, quarterly lucky draws, and special incentives for families.
Goyal sees a bright future for the pharma retail industry in India. He said that the chemist business has evolved from primarily being trade-based to service-based. Over a period of time, with changing consumer demand, perceptions, needs and preferences, chain-store retailing – a concept from the West – has now taken centre-stage in the Indian retail business environment.
High margins of 25-35 percent make the retail pharmacy a very lucrative business in India and almost all the major foreign players are eagerly waiting for policy changes to enter the country, Goyal said. Because of growing demand for change and health consciousness in the society, the traditional chemist channel is segmenting and the modern pharmacy trade is rising in India, he added.