Query:
I want to start PCD Pharma business, I have completed all legal formalities like drug licence, Goods ang Service Tax, and all. But I am unable to understand how it works means what is price to retailers, price to wholesaler’s, how margin is calculated etc. can you please help me for the same?
Response:
PCD/Franchise model works as ethical marketing. Only difference is that company doesn’t involve in direct marketing but appoint a pcd distributor or franchise to market its product and provide goods at net price basis and provides a handsome margin to fulfill all basic need of marketing and sales promotion. Read in Detail about franchise/Pcd Model and how it works here
You need to fix price to retailer and price to stockist/wholesaler as practicing in your area like 20%, 18%, 10% 8% etc. How much margin is big pharma companies providing to retailers and wholesalers. You can calculate accordingly. You can learn calculating Price to retailer, price to stockist and Maximum retail price by clicking here
Margin in pcd business is calculated by including all expenses i.e. retailer margin, stockist margin, marketing and promotional expenses, tour expenses etc.
Suppose Net Rate: N
MRP: M
Retailer Margin: R
Stockist Margin: S
Expenses and Commissions: E
Profit Margin will be calculated by: M-R-S-E-N For more detail you can calculate profit margins in pcd/franchise marketing by clicking here
Hope above information is helpful to you… For any query and suggestion, mail us at pharmafranchiseehelp@gmail.com
Read Related: Medicine wholesale business profit margin