Published by Computachem Services

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In the wake of the PAN recall, there is now a search for ideas and innovations to minimise the effects of future recalls.
Leaving aside the TGA method of action against PAN, and the subsequent politically motivated inquiry into the complementary medicines industry by Kay Patterson, Minister for Health and Aging and Parliamentary Secretary Trish Worth, what innovation is actually being investigated for community pharmacy?

Staff members were then presented with a range of actions:

* They went to the shelf and scanned the labels using PDE, or
* They took the items to the POS terminal for scanning.

If a product was on the recall list the equipment beeped twice indicating that it was to be removed from sale.

For extra insurance, this feature remained turned on during trading periods, so that if a product was presented by a shopper, the POS would beep twice and reject the sale.

This systems approach created a smooth recall with minimum fuss and bother, delivering appropriate information at the right time in the right place.
It will be interesting to see whether pharmacy software vendors are able to add this feature to dispensary and retail POS systems.
It doesn't sound too complicated, but to make it efficient, pharmacy will have to embrace the EAN product coding system sooner, rather than later.

Already, pharmacy is lagging years behind in the introduction of a universal product number, with major retailers such as Woolworths and Coles, well down the track (approaching a decade in experience) in utilising EAN codes and achieving significant savings along their complete supply chain process.
The Pharmacy Guild of Australia (PGA) needs to immediately take a lead role in this process to ensure that pharmacy manufacturers and wholesalers (in particular) align with EAN, so that a flow-on can occur into community pharmacy.
Government inspired IT systems have already nominated EAN as the preferred coding protocol, but they are still some time away from reaching community pharmacy, and helping to drive the process.

Australia-wide, the EANnet community has grown by 72% over the past twelve months.
The recent addition of approximately 24 new users brings the total number of participating companies to 314 nationally.
Some 87% of Australias top 100 grocery suppliers now subscribe to EANnet data synchronisation services.
A record number of grocery suppliers were announced as being EANnet Ready during May and June of 2003, with a further nine suppliers successfully completing the EANnet Ready Checklist.
A total of 14,500 trade items, across 39 EANnet Readysuppliers, are now available for continuous and automatic synchronisation via EANnet.
Most of the subscribers mentioned are from the grocery industry, which is an indication of the sophistication of grocery managers at all levels (independent stores to major chain stores) who are already deriving benefit.
Information Technology (IT) and the utilisation of EAN product codes is helping to drive growth and profitability into this sector, which is very evident in the revitalised independent grocery community, that not so long ago, looked as though it was headed for extinction.
Working smarter has certainly produced results, and I anguish that community pharmacy is yet to fully engage in this process.
While there are signs of this emerging technology in pharmacy, it is a fact of life that in marketing, one of the factors that create an "edge" is the lead-time you have over competitors in the introduction of innovative IT systems, that are in turn, linked to sub systems of internal market research.
These sub-systems are responsible for the correct pricing and placement of merchandise in a retail environment, and for major strategies e.g. the EDLP (Every Day Lower Prices) strategy developed by Woolworths to manipulate retail prices and create market advantage.

Coupled with the development of systems is the shrewd selection of hardware that will serve the business environment for at least a five-year period. These costs can become excessive if a wrong choice is made, and the initial purchase has to be propped up with other peripheral hardware to make it work with new forms of systems and software.

This is the reason I wrote about the "World Future Store" in the last edition, as the technology being developed in a German test store, will be creating new world standards for retailing.
What happens there is compulsory reading for all pharmacists, because you will need a guide in the correct selection of hardware and other IT systems.

Already there is a flow back of information relating to the self-checkout system embodied by the use of the NCR Fastlane checkout computer.
Over five countries (US, UK, Germany, Italy, Australia) that have installed this sytem in a major retail outlet, record a finding that 70 percent of consumers would be likely to use a self-checkout.
Approximately the same percentage of consumers in Australia have indicated that they would use the technology, particularly if it was widely distributed.
They cite greater privacy, shorter queues and faster checkout as the primary benefits.
In Australia, the Fastlane checkout system was introduced in March 2003 in two of Woolworths Big W stores. They were the first retailers in the southern hemisphere to utilise self-checkout.

Many of the consumers surveyed in Australia had not used self-checkout prior to being surveyed, and the further finding that 30 percent would be more likely to shop in a store that offered self-checkout is surprising, and a testimony to the future success of this system.

Consumers also indicated that they would like to see supermarkets, discount department stores and convenience stores offer self-checkout.
It seems likely that stores offering this type of system will have a merketing advantage over those retailers not providing the system, and self-checkout is seen as being a market differentiator, separate to that of price, convenience and location.
New customers will result.

Retailers who have experienced a longer association with this technology in Europe and the US, state that definite benefits emerge very early after installation.

* There is an improvement in customer service as staff are redeployed to other activities in a store (rather than staff reductions occurring) with improved customer relations.
* There is an improved throughput of customers resulting in shorter queues.
* There is a definite competitive advantage.
* Shoppers of all ages take readily to the technology (not just younger consumers more attuned to technology).
* Shrinkage problems have not emerged. In fact, some stores cite a reduction in shrinkage.

It will take some time before smaller retailers can afford this type of equipment and the other technology systems to back it, and herein lies the future difficulty of pharmacy. Cost is going to lengthen the lead-time and pharmacy will be continually and progressively disadvantaged in the market place.

I make no aplogies for continually plugging the need for pharmacists to be able to incorporate and build better and more efficient business structures.
Individually, as a solo operator, the costs will always beat you, and the marketing gap (and corresponding market share loss) will simply continue to widen, compared to major retailers.
Merge into a corporate structure large enough in scale to support this continual investment in IT infrastructure, and one that will also provide a scale sufficient to allow specialisation of all services, including cognitive pharmacy. Spread the cost and the risk.

However, the process must begin with a unified coding system.
Membership of the EANnet System can be individual, but this is surely the domain of a player such as the PGA to negotiate a head membership, with the same status as a Woolworths or Coles chain operation.
Perhaps they are there already, and I sincerely hope they are.
If not, then they should immediately lift their game in this significant area.