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Main Subject - The Small Retailer's Survival Guide - Part 5 - Home Delivery Costs
As part of a series of articles on how to survive as a small retailer, this article and the article that will follow are about how a small retailer can set up a home delivery service
Home delivery was once the preserve of large department stores and some small local retailers. Now, thanks to the internet and improved global logistics, virtually anything can be delivered t
Home delivery was once the preserve of large department stores and some small local retailers. Now, thanks to the internet and improved global logistics, virtually anything can be delivered t
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
o anywhere. Does the fact that home delivery is now commonplace mean that small retailers should not bother with it? Well, of course, most small retailers didn't deliver in the first place, so will they be jumping on a band wagon that is already overloaded? Possibly. However, the costs of setting up home delivery may not be as overbearing as you may at first think. It may
; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.
Examples of combination products may in
Examples of combination products may in
e worth at least considering the idea.
Perhaps, if you never made home deliveries in the past, you should consider making them now. And if you have always delivered, I would recommend that you try to continue the service. The fact that many others are doing it does not mean you should stop. They are doing it because there is obviously a demand for it. If others are offeri
Perhaps, if you never made home deliveries in the past, you should consider making them now. And if you have always delivered, I would recommend that you try to continue the service. The fact that many others are doing it does not mean you should stop. They are doing it because there is obviously a demand for it. If others are offeri
lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.
g home delivery then, if it is viable, so should you. Many small retailers are certainly on the ropes these days, but when it comes to delivery then I believe that the best form of defense is attack. The fact that others are doing it means you need to at least consider competing. The next article in this series looks at the benefits - and the pitfalls - of home delivery. T
here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe
is article considers the costs of setting up such a scheme.
Analyzing the Costs and Benefits The decision of starting (or continuing) a delivery service must, like all business decisions, be made using a proper cost/benefit analysis. What are the capital and revenue costs involved? What are the benefits? The costs calculation may be fairly straight forward but the
Analyzing the Costs and Benefits The decision of starting (or continuing) a delivery service must, like all business decisions, be made using a proper cost/benefit analysis. What are the capital and revenue costs involved? What are the benefits? The costs calculation may be fairly straight forward but the
d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.
Combination pro
Combination pro
benefits less so. If you cannot arrive at a reasonable estimate then you may need to carry out a trial.
Costs Firstly consider the outlay and running costs for the vehicle. Do you need to purchase or lease a vehicle to do the job? If you do you might have trouble justifying the project. After 5 or 6 years a delivery van will start to cost you serious money in mai
Costs Firstly consider the outlay and running costs for the vehicle. Do you need to purchase or lease a vehicle to do the job? If you do you might have trouble justifying the project. After 5 or 6 years a delivery van will start to cost you serious money in mai
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
tenance and repairs. Even though it can be a capital cost, think of vehicles as more of a revenue cost, a week to week drain. Just amortize the purchase cost over 5 years to work out the true revenue cost of purchasing a van. If you intend to lease, then this aspect is already worked out. Add to this the running costs, which for a vehicle can be considerable. I will make a
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
rough and ready prediction here and now: if you purchase or lease a vehicle for the sole purpose of making customer deliveries then it will not pay. Think of another way. What you must try to do is sweat your assets. A delivery vehicle that gets a run out, say once per day,
is not earning you money for the rest of its time. It's like taking on a new staff member on a ful
nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically
time wage, but only having them work 12 hours per week. There are various ways of making fuller use of a vehicle:
- Share the delivery service with others: if you are a food grocery store and wish to deliver to some of your customers, then ask the other nearby stores if they would also like to take part in the scheme and send their goods out to customers on your v
- Share the delivery service with others: if you are a food grocery store and wish to deliver to some of your customers, then ask the other nearby stores if they would also like to take part in the scheme and send their goods out to customers on your v
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
ehicle and share some of the costs. Alternatively you could piggy-back the video rental delivery van and simply pay them a modest standing charge or pay for each delivery. Of course, many jurisdictions have regulations governing the manner in which foods and non foods, cooked and raw foods, foods and drugs etc should be separated. You must also take into account the need t
ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi
keep certain products refrigerated. You may need to use a cool-box or
roll cage cover in order to keep products at the right temperature in a van with an ambient temperature. There are also regulations in some areas about who is authorized to handle certain
ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.
Following aspects would a
Following aspects would a
oods such as drugs, alcohol and cigarettes. So make sure you check first.
- Use your own vehicle: Once again, attention must be paid to the needs to protect foods and other products from contamination or temperature abuse. If you can transport the goods using your own vehicle and not violate any regulations and you can ensure the products are well protected, then w
- Use your own vehicle: Once again, attention must be paid to the needs to protect foods and other products from contamination or temperature abuse. If you can transport the goods using your own vehicle and not violate any regulations and you can ensure the products are well protected, then w
dd to the challenges in developing combination products:
Which markets to tap where the combination products can do fairly well?
Which combination prod
Which markets to tap where the combination products can do fairly well?
Which combination prod
y not do it. At a swipe you have a delivery service with no capital outlay. You may also be able to persuade your own staff (if you have any) to drop products to customers' houses on their way home where the route fits the direction of their journey. Even if you have no staff, you probably need to travel to the wholesaler, bank or your favorite aunt on occasion. Try to use
cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
the vehicle for more than one purpose on each trip, where this is practical.
- Consolidate deliveries by area and time: if your catchment area is spread out quite wide and far, or if the costs are simply too much to afford daily deliveries, produce a delivery guide for your customers that breaks your catchment into zones. Let's say you identify five local zones. Y
- Consolidate deliveries by area and time: if your catchment area is spread out quite wide and far, or if the costs are simply too much to afford daily deliveries, produce a delivery guide for your customers that breaks your catchment into zones. Let's say you identify five local zones. Y
tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
u could deliver to homes in zone A on Monday, zone B on Tuesday and so on. This method will lead customers to expect deliveries on these set days and will help them plan their shopping. It may help to smooth your peaks and troughs in demand and this could lead to improved stocking and ordering leading to less out of stocks and less overstocks/wastage. You could even have j
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
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
st one delivery day a week, with timed and zoned drops through the day. Thus, homes in zone A would receive their deliveries between 9am and 10am, zone B between 10.30am to 11:30am. By having one delivery day, it may pay to hire a van and even a driver to take care of the deliveries for you. Many customers will get to know the delivery day and will plan for it.
Replaci
Replaci
ping new procedures for reviewing their safety, efficacy and quality.
Professional from academic institutions, pharmaceutical industries, health care indust
Professional from academic institutions, pharmaceutical industries, health care indust
g Store Sales
One thing you need to consider is the extent to which trade will be shift from your store to the customers' homes. Inevitably this will happen. To take an extreme situation, if it happens to 90% of your business than you may be onto a good thing! Give up the shop and switch to
y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products
_sales.htm">van sales! You will have less overheads and more profit. If you live above the store then consider buying a luxury mobile home and live and sell from that! If, on the other hand, only 10% of the store's business is transferred to deliveries, you may also be onto a good thing as your deliveries may expand your customer base, whilst retaining your store custo
.
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
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
ers. The chances are that the switch to home deliveries will be somewhere in between the two. In the worst case, you may not increase overall sales at all. If you are not fully covering the extra cost of home delivery you should give up the idea - but only after you have given it a decent run and only after you have experimented with different solutions. After the home del
elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.
Companies that provide selfless information through particip
Companies that provide selfless information through particip
very system has bedded in (and only after) you should consider advertising the new service in order to use it to attract new customers. For most small retailers, advertising funds are very limited, but even a small campaign is better than none at all.
The next article in this series will consider the potential benefits and problems with home deliveries for small retailers
The next article in this series will consider the potential benefits and problems with home deliveries for small retailers
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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