Case study: G & J's Pharmacy After working for a large discount drug chain in the Midwest for nearly 15 years, Glenn Schaffer and Jack Grange decided to quit and open their own pharmacy. During the four years that it had been open, sales had nearly tripled while profits increased by about 50%. G & J'd pharmacy was a 5,200-fts pharmacy that catered primarily to upper income groups. There were two other similar types of pharmacies in the town which sold comparable non-prescription products at about the same prices. However, G & J's was the only pharmacy to special order nearly any item a customer wanted, and have at lest one owner in the pharmacy from the time it opened (7 am) until it closed ( 10 pm ), 6 days a week. Both owners worked more than 60 hours per week in the pharmacy, spending much of that time dispensing prescriptions (30%), stocking shelves (30%) and just walking around and talking to patients (40%). They still hired a large number of employees for a pharmacy its size to ensure that attentive customer service was maintained. These policies of having the owners available to customers and plenty of support personnel to provide fast service were thought the primary factor in their success to date. With pharmacies' wages and benefits of $30 per hour, and non pharmacist wages and benefits averaging 415 per hour, however, they were trying to keep control over expenses. In reviewing their operations over the past 4 years, the owners felt they had to make some decisions that would significantly affect their future. First, Mr. Schaffer was getting tiered of working so many hours and having little time for his family. He wanted to reduce his time in the pharmacy in to 45 hours per week. Mr. Grange was not married, and did not seem to mind the long hours. These differences had caused some friction to develop between them in the past year. Second, quite a few of the better customers had asked that the pharmacy begin to carry some food items. The requests centered mostly on a wider selection of natural food items in bulk, and a deli section with natural juices. With limited space available and the added costs of expanding, the owners knew that they had to be careful in adding lines. However, Mr. Schaffer was concerned that of they did not make these additions, they might lose some of their customers. Third, the owner of one relatively small medical pharmacy located on the other side of town was preparing to retire, and had asked Mr. Schaffer and Mr. Grange if they were interested in buying him out. Although they had not discussed price, it appeared to the owners that a reasonable agreement could be reached in that regard. Of greater importance was whether they wanted to expand their operations. This other pharmacy was about one-fifth of the size of G & J's, and focused much more heavily on dispensing prescriptions to indigent patients. Its hours were 9 am to 7 pm, and the current owner felt that he had to be there most of the time to watch over the pharmacy's high cost of goods and labor. At this time, the owners were beginning to evaluate each of these three issues. Although they did not want to make hasty decisions, they believed that they had to take some action of them soon. 1. What should the owners go about evaluating each of these issues? 2. How can the owners resolve their differences with respect to working hours? 3. Why some pharmacists scare to open their own business? Case study: G & J's Pharmacy After working for a large discount drug chain in the Midwest for nearly 15 years, Glenn Schaffer and Jack Grange decided to quit and open their own pharmacy. During the four years that it had been open, sales had nearly tripled while profits increased by about 50%. G & J'd pharmacy was a 5,200-fts pharmacy that catered primarily to upper income groups. There were two other similar types of pharmacies in the town which sold comparable non-prescription products at about the same prices. However, G & J's was the only pharmacy to special order nearly any item a customer wanted, and have at lest one owner in the pharmacy from the time it opened (7 am) until it closed ( 10 pm ), 6 days a week. Both owners worked more than 60 hours per week in the pharmacy, spending much of that time dispensing prescriptions (30%), stocking shelves (30%) and just walking around and talking to patients (40%). They still hired a large number of employees for a pharmacy its size to ensure that attentive customer service was maintained. These policies of having the owners available to customers and plenty of support personnel to provide fast service were thought the primary factor in their success to date. With pharmacies' wages and benefits of $30 per hour, and non pharmacist wages and benefits averaging 415 per hour, however, they were trying to keep control over expenses. In reviewing their operations over the past 4 years, the owners felt they had to make some decisions that would significantly affect their future. First, Mr. Schaffer was getting tiered of working so many hours and having little time for his family. He wanted to reduce his time in the pharmacy in to 45 hours per week. Mr. Grange was not married, and did not seem to mind the long hours. These differences had caused some friction to develop between them in the past year. Second, quite a few of the better customers had asked that the pharmacy begin to carry some food items. The requests centered mostly on a wider selection of natural food items in bulk, and a deli section with natural juices. With limited space available and the added costs of expanding, the owners knew that they had to be careful in adding lines. However, Mr. Schaffer was concerned that of they did not make these additions, they might lose some of their customers. Third, the owner of one relatively small medical pharmacy located on the other side of town was preparing to retire, and had asked Mr. Schaffer and Mr. Grange if they were interested in buying him out. Although they had not discussed price, it appeared to the owners that a reasonable agreement could be reached in that regard. Of greater importance was whether they wanted to expand their operations. This other pharmacy was about one-fifth of the size of G & J's, and focused much more heavily on dispensing prescriptions to indigent patients. Its hours were 9 am to 7 pm, and the current owner felt that he had to be there most of the time to watch over the pharmacy's high cost of goods and labor. At this time, the owners were beginning to evaluate each of these three issues. Although they did not want to make hasty decisions, they believed that they had to take some action of them soon. 1. What should the owners go about evaluating each of these issues? 2. How can the owners resolve their differences with respect to working hours? 3. Why some pharmacists scare to open their own business