How to calculate Profit Margin, Net Rates, Trade Rates, Price List in Pharma franchise Marketing?

We hope if you have visited this page, you have decided to start pharma franchise/pcd marketing Before start you want to know- how much you can earn through pcd pharma and franchise marketing. Unlike other business, this business don’t have fixed percentage margin. How can you earn from it depend at your selling skill.

Here we are going to present rough estimate of your total percentage margin.
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Check Here: Pcd/Franchise pharma companies list here

• Check Sample Product list here
• Check Ayurvedic Company product List sample here

(Want your company price list here for free, mail company price list us at pharmafranchiseehelp@gmail.com)

PCD Pharma Franchise Companies have simple calculation to finalize their net rates and MRP’s. Most of franchisee and PCD companies finalized their net rates and MRP’s, according to market conditions, and according to their competitors.

Raw material cost is basis of net rate calculation. Pharma Franchise or PCD companies provide medicines to their franchisee, at net price basis.Net Prices are calculated by following formulas:
Total Cost = Manufacturing cost + Packing Material Cost + Taxes + Transportation + Promotion Material + Expenses.
Net Rate = Total cost X percentage of margin.

Percentage of margin may differ from companies to companies. Percentage of margin is calculated according to number of employees, administration expenses and other expenses of company.Pharma franchise or PCD Companies provide visual aids, catch covers, leaf behind cards, bags, writing pads, dairies, calendars, pens and number of promotion inputs. That’s way their prices are higher than generic drugs. And doesn’t do direct marketing, hence, prices fall below branded drugs.

Companies have calculated their rates at which they will sell to their customers. Then their franchisee’s turn to fix their margin according to their cost and expenses. Transportation between companies to party also causes expenses hence we will calculate this expense into franchise distributor costing.

Suppose if a Franchisee Distributor purchase a particular medicine at the rate of 10 Rs with a MRP’s of 35 Rs and after include with transportation and tax, it will be increased by 10% and become 11 Rs.

How will he calculate distributions of margins?
20% margin with scheme (10% of free goods or whatever applicable) will go to retailer, even more in some cases. After giving 20% + scheme to retailer, a sum of approximately 8 Rs. will be deducted in MRP. Now value left to 27 Rs.

Trade price for the drug will be 70% of MRP i.e. 24.50/-.This is price that is supposed to be at which Pharma franchisee Distributor will provide drugs to the wholesaler but it is not actual. We consider it standard and use it to find profit margin.

So, Stockiest Margin = Retailer Price – Trade Rate (i.e. 27-24.5 = 2.5 Rs, Nearly 10% of Trade rate)

Now 13.50 Rs left in the hand of Pharma franchisee Distributor. His marketing cost (promotion inputs or commission, small gifts, tours, functions etc.) will be approximately 25 to 30 % of total MRP and this amount will be nearly 8.75 to 10.5 Rs. Total margin of Pharma franchisee Distributor will be 4.75 to 3 Rs and that is equal to 43% to 25 %. In this margin, franchisee salary, travelling expenses, medical representative expenses etc. At purchase of 11/-, you can earn minimum of 3/- as gross profit.

Download profit margin price list by clicking here

Example Price List Format:

Product	Net Rate	Trade Rate	MRP
ABC	10/-	24.50/-	35/-
DEF	12/-	28/-	40/-
GHI	9/-	21/-	30/-

Market factors or type of products also make impact at MRP and Net Rate. Companies also provide free goods or offer in product list. How offer or free goods create impact at your margin read here

That margin is not enough if we will calculate difficulty and competition in market. That Calculation was based upon upon general calculations, you can’t calculate price to retailer or price to stockist from it. It is general calculation for calculating roughly profit margin. If someone finds it incorrect, he can make amendment in it and advice me to correct it. I will be apologized for any mistake.

But one thing, I want to make clear for Pharma Franchise Companies, they should respect their franchise because they do most of hard work to sell your product and gets minimum margin to fulfill their life.

Confuse about how to calculate Price to retailer/Price to Stockist, Read here

You can ask for price list of Pharma pcd Franchise company by mail from us. Send your query for product cum price list at pharmafranchiseehelp@gmail.com

We can provide you free of cost Pharma Franchise consultant to PharmaDistributors and Marketing professionals want to start his own marketing. You can mail me for your question and problems at pharmafranchiseehelp@gmail.com or through contact box…

Hope above information is helpful to you…

Hope for best…

Related Articles:

• How to start Pharma Franchise Marketing
• How to become Franchisee/Pcd Pharma Distributor?
• Things before associating with any PCD pharma company.
• Which Pharma Franchise Company (PFC) or PCD Company will be best for association? What to do befor
• How to face problems like MR’s salary, Profit margin, Market Strategy etc in Pcd marketing?
• Difference between pcd work and prescription work
• What is Pharma Franchise Distribution and Marketing Agreement?
• Medicine wholesale business profit margin

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