Pharmacy And Drug Store Franchises Market Overview
The pharmacy and drug store franchises market is expected to reach US$ 82.4 Billion in 2023, up from US$ 72 Billion in 2022, reflecting a Y-o-Y growth rate of over 14%. Furthermore, from 2023 to 2033, a CAGR of 14.2% is expected for the industry, reaching a valuation of US$ 310.87 Billion. With an increase in the sales of generic drugs for various chronic as well as infectious ailments, consumers are looking for easily accessible distribution channels, furthering popularity of pharmacy and drug store franchises.
The USA is expected to emerge as the largest market for pharmacy and drug store franchises, given the fact that 90% of all prescribed medicines are generic. On average, generic drugs cost about 80 to 85% less than brand name drugs. Over the last decade, this difference in drug costs saved the USA healthcare system nearly US$ 2.2 Trillion. This includes a savings of US$ 313 Billion in 2019 alone, with US$ 96.1 Billion in Medicare and US$ 48.5 Billion in Medicaid savings.
Besides a hub for generic drugs, pharmacy and drug store franchises are also sought after for other consumer products, including toiletries, cosmetics & beauty products and confectionery among others. In addition, pharmacies and drug stores are easily accessible, given their proximity and ease of access. Besides, several healthcare providers recommend a visit to pharmacies and drug stores to avail non-generic drugs.
Data Points
Key Statistics
Market Value of Pharmacy and Drug Store Franchises in 2022
US$ 72 Billion
Expected Market Value of Pharmacy and Drug Store Franchises in 2023
US$ 82.4 Billion
Projected Value of Pharmacy and Drug Store Franchises Market in 2033
US$ 310.87 Billion
Growth Rate (2023 to 2033)
14.2% CAGR
Globally, healthcare expenditure is increasing exponentially, thanks to an expanding population base. According to the World Health Organization, global spending on health has more than doubled in real terms between 2000 and 2019, reaching US$ 8.5 Trillion, or 9.8% of global GDP. A major part of this healthcare spending is devoted to addressing chronic ailments. This is especially evident in the United States. Estimates by the Centres for Disease Control and Prevention project that 90% of the country’s US$ 4.1 Trillion is spent on addressing chronic and mental health conditions.
More than 877,500 Americans succumb to heart disease or strokes- representing 1/3rd of overall deaths. Hence, patients are seeking continuous medication to monitor their heart rates. Besides consuming the conventional medications, doctors also prescribe several generic medicines which are readily available at pharmacies and drug stores, which are attracting a host of franchise and partnership offers.
While pharmacy and drug store franchises will remain prominent, there are some factors which may restrain market growth. Firstly, due to the wide availability of generic drugs, there is a risk of marketing counterfeit medications, which are easily available across retail pharmacies and drug stores. In addition, the high degree of competition has led to small and medium sized market players to either withdraw or amalgamate with existing large-scale franchises.
Existing pharmacy and drug store franchises are focusing on offering a host of product lines, besides conventional drugs and healthcare products. Additionally, some of them also offer services, including testing for various infectious ailments. For instance, Walgreens announced in December 2022 that its rapid flu and COVID-19 testing kits are available at more than 5,000 pharmacies worldwide. This is making it easier for communities to identify and manage these highly transmissible viruses throughout the winter season.
On a similar plane, it announced free delivery of Paxlovid, a COVID-19 oral antiviral therapy. The delivery is being carried out in partnership with DoorDash and Uber. This initiative is aimed at increasing access to COVID-19 treatment, with a focus on reaching those in socially vulnerable or medically underserved areas at a time when COVID-19 cases are beginning to rise again across the United States.
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Pharmacy & Drug Store Franchises Market Drivers
A critical driver for the Pharmacy & Drug Store Franchises market is the widespread adoption of generic drugs. These drugs are identical to branded drugs in dosage, safety, strength, method of administration, characteristics & purpose of use. The main benefit is that they are substantially cheaper than the latter. As per the USA Congressional Budget Office, generic drugs can save patients anywhere between $8 & $10 billion a year.
A second driver is the fact that pharmacy & drug stores are essentially a basic need of humanity. Health-related expenditure will only go up across the world as more & more people get access to better medical care. An ageing population in developed countries, youth with sports related injuries, or working professionals suffering from clinical depression, stress, diabetes or hypertension will all be dependent on the Pharmacy & Drug Store Franchises market.
Another major factor is the medical education industry. Pharmacy schools, in particular, are responsible for the resurgence in their franchises. Medical schools tend to provide their students only specialised knowledge with very little business or management skills.
Pharmacists can make good money opening franchises which also help them pay off their massive student loans. These are anticipated to be the main drivers of the Pharmacy & Drug Store Franchises market in the next decade.
We all need to visit a pharmacy or drug store at least occasionally due to an injury, disease or just to stock up on vitamin & other supplements. The Pharmacy & Drug Store Franchises market consists of neighbourhood pharmacies, large domestic or global drug store chains, supermarkets, retailers with specific drug store departments and various pharmacy chains.
The Pharmacy & Drug Store Franchises market serves its clients a range of prescription & over-the-counter medicines, toiletries, beauty products & other forms of consumable goods. The players involved in this industry are not independent but exactly like other retailers that operate under franchise agreements. The terms & conditions specified in the franchise agreement govern how these stores operate.
While drug stores & pharmacies are ubiquitous, the competition in the industry is extremely intense as retailers have to adapt to rapidly changing trends around the world and seek to enhance customer loyalty. There has been rapid growth in the 21st century in the Pharmacy & Drug Store Franchises market.
Pharmacy & Drug Store Franchises Market Restraints
There are some challenges to be overcome in the Pharmacy & Drug Store Franchises market. A major one is the cost of pharmacy-based managers which have been rising. PBM’s oversee drug-benefit plans of both the employers & health insurers. Their main purpose is to keep the cost steady, which they accomplish by deciding which drugs to cover & then securing lower prices from drug makers through rebate programs.
Since these are based on a percentage cut, PBM’s have benefited from skyrocketing drug prices. There is also intense competition as incumbent players resort to a price war to drive out new players with limited funds. Not only does this reduce the overall industry profitability, but it also makes fledgling companies hesitant to enter the Pharmacy & Drug Store Franchises market.
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Pharmacy & Drug Store Franchises Market Key Regions
The largest Pharmacy & Drug Store Franchises market in the world are the USA, China, Japan, the E.U and the rest of the world in that order. The USA is expected to maintain their sizeable lead over other countries on account of a large population segment being aged 65 and over, high disposable income, and government funding for Medicare and Medicaid.
China is anticipated to become the largest within the next decade or so on account of their massive population and government focus on the healthcare industry as a whole. This will thereby also benefit the regional Pharmacy & Drug Store Franchises market.
Pharmacy & Drug Store Franchises Market Key Market Players
Some companies in the Pharmacy & Drug Store Franchises market are MedPlus, Medzone, Medicap, Apollo Pharmacy, Discount Drug Stores, RK Franchise Consultancy, CVS, Rite Aid, Walgreens, & Shopper’s Drug Mart.
The research report presents a comprehensive assessment of the market and contains thoughtful insights, facts, historical data, and statistically supported and industry-validated market data. It also contains projections using a suitable set of assumptions and methodologies. The research report provides analysis and information according to market segments such as geographies, types and applications.
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The report covers exhaustive analysis on
Market Segments
Market Dynamics
Market Size
Supply & Demand
Current Trends/Issues/Challenges
Competition & Companies involved
Technology
Value Chain
Regional analysis includes
North America (USA, Canada)
Latin America (Mexico. Brazil)
Western Europe (Germany, Italy, France, UK, Spain)
Eastern Europe (Poland, Russia)
Asia Pacific (China, India, ASEAN, Australia & New Zealand)
Japan
Middle East and Africa (GCC, S. Africa, N. Africa)
The report is a compilation of first-hand information, qualitative and quantitative assessment by industry analysts, inputs from industry experts and industry participants across the value chain
The report provides in-depth analysis of parent market trends, macro-economic indicators and governing factors along with market attractiveness as per segments. The report also maps the qualitative impact of various market factors on market segments and geographies.
Frequently Asked Questions
What was the value for pharmacy and drug store franchises market in 2022?
As of 2022, the pharmacy and drug store franchises market reached a valuation of US$ 72 Billion
At what value will demand for pharmacy and drug store franchises close in 2023?
Future Market Insights expects demand for pharmacy and drug store franchises to be valued at US$ 82.4 Billion in 2023
What is the expected growth rate for the market for pharmacy and drug store franchises?
From 2023 to 2033, the pharmacy and drug store franchises landscape is expected to grow at a 14.2% CAGR
