Summary - Business

Your retail business is doing poorly and or your profits continue to get smaller each year. You are in desperate need of cash flow to pay your overdue bills. Should you hire a consultant?

If you

According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product

are going to follow the consultant’s advice, it is the right thing to do. On the other hand, if you don’t want to follow the consultant’s advice, don’t waste your time or money. In fact, you shoul

; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.

Examples of combination products may in

d sell your business or close your store. Your business will continue to slide until eventually your cash is gone.

I have done many consulting contracts the past few years. They have been in diff

lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.

rent industries, but something’s are common in all stores. Here are some things successful owners have in common:

1. The owner’s that have experienced the best results have an open mind to the co

here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe

nsultant’s suggestions.

2. The owners and their employees give full cooperation to the consultant. Management has a tendency to be upset with a consultant. They feel that their toes have been ste

d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.

Combination pro

ped on and don’t want to follow the consultant’s advice.

3. Good owners know their previous course of action will continue to produce unsatisfactory results.

Here are some of the biggest issues

ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc

that consultants have with owners.

Ad Pricing – Many owners’ love to advertise poor items or good selling items with small discounts. Advertising has only one purpose. It is to bring customers in

easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi

o your store. You can go 75-90% off on a poor seller and will have little movement. Most customers will not consider an item on sale unless it is at least 20% off regular retail. Having a good sel

nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically

ler at ? off could bring decent traffic to the store. Most customers who come in for the sale item will buy other items at full price. This is a difficult idea for many owners to discuss. Normally

and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ

the best ad prices are 20%, 50% or 75% off regular retail. Making signs for ? off will result in more sales than 50% off.

Had a couple of owners told me, if they wanted large discounts on their

ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi

merchandise, they would not need a consultant. They could have done the markdowns themselves. It is ironic that both stores had severe cash flow problems and loads of old inventory. It would have

ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.

Following aspects would a

been better for both of them to close their doors or go ? off their entire store. They did not realize that their customer count would continue to drop unless they changed their mind-set.

Old mer

dd to the challenges in developing combination products:

Which markets to tap where the combination products can do fairly well?
Which combination prod

handise needs to be liquidated regularly. Inventory either makes you money or costs you money. Merchandising that is over a year old should be reduced to create space and cash for good selling ite

cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin

ms. You can use this cash to make profit by buying more good selling items.

Resistances to Change- Some owner’s have been doing their business for 10-50 years. Times have changed and owners must

tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen

dapt. It is tough to run a successful business. New strategies are needed to be a viable business. Business as usual will result in the same poor results.

Here is a question about profits. Let’s

t?

As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel

say you order an item that is $10 cost and 10 per case ($100 Case). You have sold 5 of these at $20 each. How much profit have you made?

Most people would have said 5 items X $10 profit per item

ping new procedures for reviewing their safety, efficacy and quality.

Professional from academic institutions, pharmaceutical industries, health care indust

$50. The better answer would be 0. You have made $100 revenue and your total costs were $100. Your profit will be from the sale from the last 5 items.

There is one last thing small businesses sh

y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products

ould do to help their sales. You cannot compete with the big boys in pricing. You need to have exceptional service and a liberal refund policy. Many businesses are afraid of being abused by refund

.

As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de

and hate to give them. If you have a liberal refund and use common sense, your profits will increase because of customers being more trustful of your company.

A consultant can help a struggling

elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.

Companies that provide selfless information through particip

business. However, the consultant suggestions will not be effective without an owner following the advice 100%. Following all parts of a consultant plan will lead to increase profits and cash flow

tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products

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