Pricewatch: 25 May, 2018 - OTC medicine

Analysis

Whether it’s flu in the winter or hay fever in the summer, medicine is a category which is popular in convenience stores all year round. 

Charging at RRP or under on a pack of Piriteze was the overwhelming trend in this week’s Profit Checker graph, as more than 85% of retailers chose these options. 

The trend across the wider market was more balanced, however, as seven out of 12 retailers surveyed in the Price Checker table favoured undercutting the RRP. 

Meanwhile, the four retailers interviewed were split, citing customer knowledge of pricing and the need to make distress purchases as key factors in their pricing strategies.  

Profit checker

Price Price distribution %

Price checker

AVERAGE UK SELLING PRICE
3.9973612374886
BOOKER RRP
4.25
GENERAL STORE IN SOUTHWEST SEASIDE HOLIDAY AREA
4.29
SHOP IN COMMERCIAL AREA OF SUFFOLK TOWN
4.09
SHOP IN RESIDENTIAL AREA OF HAMPSHIRE SEASIDE TOWN
3.99
LARGE C-STORE IN NOTTINGHAM SUBURB
4.29
SHOP IN RESIDENTIAL ESTATE IN SOUTH WALES VILLAGE
3.79
LARGE HIGH STREET SHOP IN BRADFORD SUBURB
3.99
HAPPY SHOPPER IBUPROFEN TABLETS 16-PACK £0.87 £0.82 £1.09 - £0.99 £1.10 £0.85 £0.99
HAPPY SHOPPER PARACETAMOL TABLETS 16-PACK £0.79 £1.15 £0.89 - £0.99 £0.90 - -
COVONIA COUGH MIXTURE 150ML £3.88 £3.79 - £3.79 £3.99 £3.99 £3.85 -
NUROFEN TABLETS 12-PACK £2.68 £2.69 - £2.69 £2.99 £2.79 £2.59 £2.49
CALPOL SIX PLUS BOTTLE 80ML £4.01 £4.25 £4.29 £4.09 £3.99 £4.33 - £3.99
IMODIUM CAPSULES SIX-PACK £3.76 £3.79 £3.95 £3.99 £3.99 £3.69 £3.29 £4.89
NUROFEN EXPRESS CAPLETS 12-PACK £3.61 £3.49 - £3.40 £3.85 - - £3.89
GALPHARM PARACETAMOL CAPLETS 16-PACK £0.76 £0.69 £0.89 £0.69 - - £0.69 £0.99
HAPPY SHOPPER PARACETAMOL CAPSULES 16-PACK £1.12 £1.15 £1.18 £1.15 £0.99 £1.25 £1.15 £0.99
PIRITEZE ONE A DAY HAYFEVER TABLETS SEVEN-PACK £4.50 £4.99 - - - - £5.29 -
RENNIE PEPPERMINT 24-PACK £2.40 £2.35 £2.99 - - - £2.25 £2.89
Data supplied by
Data supplied by

EDFM is a specialist in helping leading suppliers to the UK's independent convenience channel get value, insights and business benefits from EPoS data. To find out how they could help you, call 07976 295094

How we drive our profit

Kashif Nadeem Avatar

Kashif Nadeem

Premier Greenlaw

Location: Berwickshire

Size: 1,100sq ft

Type: community

Top Tip
Never be short of medicines because there will always be demand all year round
I always get my medicines from Booker and add 20p to the RRP. They’re seen as essential items when customers need to cure a common ailment, such as hay fever, and they won’t mind spending a little extra as a result. Medicines are a little bit more expensive to buy from wholesale, so we do need to make the money back as well. Products like Piriteze are one of my bestsellers. It’s worth rotating your stock during particular seasons as well because some illnesses are more frequent at certain months of the year.
Ken Singh Avatar

Ken Singh

Mill Hill Stores

Location: Pontefract

Size: 800sq ft

Type: housing estate

Top Tip
Stock medicines on the shop floor as customers like to read labels and examine the ingredients
My shop is based in a neighbourhood with families, which gives us a good customer base. Booker is the wholesale supplier of medicines for us. We charge at RRP on products such as Piriteze, giving us margins of 30%. We can’t add a premium because customers have an expectation of the price of medicine. One of the factors which helps make medicines popular is they’re often endorsed by medical professionals, and this helps increase sales because customers know they can trust them. This is particularly true of brands such as Calpol and Piriteze.
Paul Stone Avatar

Paul Stone

Spar Oxford Road

Location: Manchester

Size: 2,000sq ft

Type: city centre

Top Tip
Ensure medicines are visible because customers can often miss them when they’re behind the till
We normally price our medicines at RRP, and I get a lot of demand for these products because the shop is on one of the busiest streets in Manchester city centre. I’ve charged RRP since I opened my first store in the 1990s. The majority of our customers are office workers and students. Medicines are particularly popular among the latter, especially at the start of the term. New students come in every year and are exposed to a lot of new people. This increases the likelihood of them getting ill and demand rises as a result.
Harj Gill Avatar

Harj Gill

Select & Save The Windmill

Location: Rubery, Birmingham

Size: 2,700sq ft

Type: neighbourhood

Top Tip
Stock medicines on the shop floor as this gives customers time to examine the products
We normally add 20p on top of the RRP – this helps give us margins of between 35% and 45%. Medicines is a category which customers don’t buy that often, so knowledge about pricing isn’t as great as with groceries or chilled. Products like Calpol and Piriteze are some of our bestsellers products. We stick our medicine on the shop floor because it gives customers more time to look at the products. They get reluctant if medicine is behind the till because they are worried about holding other customers up in the queue.

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