The company indicated last year that it would roll out pharmacies, but did not go ahead with it due to regulatory uncertainties.
Chennai-based online medical store Netmeds.com is finally ready to roll out its plan to launch physical stores, marking its move towards an omni-channel growth strategy with an eye on emerging as a leading player in the pharmaceuticals retailing business. The company indicated last year that it would roll out pharmacies, but did not go ahead with it due to regulatory uncertainties. In an exclusive interaction with FE, Pradeep Dadha, CEO of Netmeds, said though the company had wanted to roll out offline stores in early 2017, it held back to get clarity on several aspects of the GST regime. “Now that we have enough understanding of the issues, we have re-evaluated the whole plan and we will be rolling out the stores soon,” he said. Stores will be set up on the franchisee model.
The start-up is also considering a B2B business model through which it will offer pharmacies medicines at the wholesale rate for selling to their customers. The company at present offers discounts up to 20% on prescribed medicines to its customers. Dadha said they are evaluating how to get pharmacy stores to buy from the company. “It would work like a B2B business, we will be doing a wholesale business with them,” he said. Queried about Netmeds’ growth plans, Dadha said at this point the focus is on increasingly making medicines easily accessible and affordable to customers. The company will be building infrastructure for this purpose. Netmeds is not looking to expand overseas, he said. “We want to strengthen our India focus before, if at all, venturing out to any other foreign countries.” Netmeds.com, promoted by the Dadha family, which has been in the pharmaceutical business for more than hundred years, had raised $14 million in its latest round of funding in October 2017. The funding was led by Tanncam, a Cambodian investment holding company, which was joined by Sistema Asia Fund, the India-centric venture fund, spun off by Sistema, Russia’s largest public investment holding company.
The future plans include partnerships with other pharma/nutritional companies to use data analytics for able to target specific patient groups. Netmeds.com currently has eight fulfilment centres operational in Chennai, Bengaluru, Hyderabad, Delhi, Pune, Ahmedabad, Raipur and Kochi. The company will operationalise six more to ensure efficient and quicker deliveries across India. Dadha said his company supplies medicines to 12,500 pin codes of the total 19,000 pin codes in the country, with tier II and tier III cities significantly contributing to the business. Value-added services are another USP of Netmeds. These services include automated refill reminders, loyalty programmes, detailed information on more cost-effective substitutes, expense analytics, order history, data records, digital copy of prescriptions, etc. Data analytics allows the company to predict demand with accuracy, thus enabling better inventory management and making sure stocks are available to fight challenges such as changing seasons and epidemics through early warning indicators.