Business Model of Pharmacy App: How to Make Money With Medicine Delivery App?
1 year ago
Yes, this blog will make you the most financially literate man available in the room of pharmacy app owners.
Or at least, you will have enough knowledge to make profitable decisions as an owner of a medicine delivery app.
So, let us answer all of your questions related to the business model of the online pharmacy app, one by one.
Our other useful resources:
Which are the top pharmacy app business models?
There are two major business models of medicine delivery apps.
But your type of pharmacy app defines which business model you should go for.
So, we have to discuss business models based on the type of pharmacy app.
Type #1: Pharmacy app owned by pharmacy stores
Pharmacy stores that are running their business operations in a locality build such a type of mobile app to expand their operations and take it online for higher sales.
They now receive new prescriptions and refill orders online through a mobile app, which get stored in their Pharmacy Management Software, then they fill that prescription and make it delivered to the doorstep of the patients.
The major financial benefits for such a type of pharmacy are to attract new customers even outside of their locality, build a larger user base and earn more.
Their major revenue stream is the prescription fee itself.
Type #2: Pharmacy app marketplace
Such a type of pharmacy app works as the independent app which connects both 3rd party pharmacies (listed on marketplace platform) and patients.
It is very easy to run operations of the pharmacy app marketplace as you don’t have to manage medicine inventory and other pharmacy workflows.
You only have to provide your delivery drivers to listed pharmacies to pick up filled prescriptions from pharmacy locations and deliver it to patients.
You here earn a fixed percentage of commission on each prescription order placed by users through your platform.
This works the same as DoorDash, Uber, Airbnb where you provide pharmacies with an online medium to increase their sales and you take a fixed portion of what they make thanks to your platform.
Monetization strategies: how to make money with pharmacy apps?
To not pop up any confusing situation, we are going to share monetization strategies regardless of your pharmacy app type.
- Commission fee
You can in all cases let other 3rd party pharmacy stores utilize your online platform to find new customers and sell medicines online. Here, as discussed, you can take a fixed percentage of commission on every order.
You can offer several subscription plans to your users which help them save money in the long term and help you to build customer loyalty.
Each subscription plan offers them extra benefits such as free delivery, priority delivery, assured discount, family plan, free consultation etc.
Patients anyway require to have a medical consultation with physicians, before using your platform to place prescription orders. So why not let them virtually talk to physicians through your pharmacy app itself?
This will not only increase your user base but also let you generate one more very profitable revenue stream.
This is the most popular mobile app monetization strategy. However, it should be executed precisely as it largely influences the user experience negatively.
Here, you show 3rd party relevant ads on your app and get paid based on the number of clicks on that ad banner.
- Healthcare eCommerce
In addition to medicines, you can also sell medical and wellness devices, supplements, self-care equipment, oral care products, skincare products, OTC medicines etc.
How much capital is required to build and launch a pharmacy app?
In case you are wondering, the capital cost is the money you would require to successfully build and launch a pharmacy app.
The total capital cost required to start an online pharmacy includes,
- App Development
It will vary from $10K to $90K+, based on your needs.
For instance, if you build an MVP version of a cross-platform app, it would cost you somewhere between $25K to $50K, and in many cases even more.
But if you end up building a web app, it would cost you 20% to 30% less than the mobile app.
And if you want to build a custom full-fledged pharmacy app, it will cost you even more than $50K as it accommodates advanced features working on cutting-edge technologies.
(Please note, it is never feasible to estimate development cost without knowing your exact requirements as there are too many factors that influence the total cost.)
- Initial Workforce Hiring
You need to have dedicated people to make sure all pharmacy operations performed online via the app are running seamlessly.
The most basic requirement is the customer support team to answer the queries of users.
If you are also offering telemedicine service, you need to hire or onboard physicians too. You also need to hire delivery drivers for seamless logistic operations.
And if you are running your online pharmacy operations on a large scale, you must also have an in-house IT team to look after and maintain the app. (You can outsource it too.)
- App Marketing
You need to allocate a budget for your app marketing as it is difficult to survive in the overly intensified market of online pharmacies without a proper marketing strategy.
For high ROI and desired outcomes, you must have separate budgets and plans for pre-app-launch marketing and post-app-launch marketing because marketing is an ongoing process.
How much is the operating cost of a pharmacy app?
Operating cost is nothing but the money you need to spend to keep your pharmacy app running.
Two major operating costs include,
- APIs Fee
Developers do not have any practical option other than integrating APIs to achieve some features easily and to not let development costs skyrocketed.
However, each of these API providers charges you either a fixed monthly fee or a monthly fee based on usage.
For instance, payment API providers charge a fixed percentage of commission on every transaction. Communication (chat, voice call, SMS, video call) API provider also charges based on usage.
- App Maintenance & Upgradation
A pharmacy app is a piece of technology and it needs to be maintained for flawless working.
With changing scenarios of the market and changing needs of the users, you also need to upgrade existing features or add new features.
Some other common operating costs include,
- Customer support and service
- Ongoing marketing
- Staff management
So, planning to build a medicine delivery app? We can help you with development, compliance & business model
We’re an Ontario-based healthcare-focused IT company.
Or, we are a Canadian IT company that has only been entertaining healthcare IT projects.
But why only healthcare?
Well, because we strongly believe that healthcare requires specific knowledge.
With generalized knowledge, you can’t assure the clinical outcome our healthcare industry is known for.
Talking about pharmacy app development, we have built several full-fledged pharmacy mobile/web apps for Canadian and American pharmacies.
We do have ultimate expertise in Kroll integration and integration of other Pharmacy Management Systems.
Our dedicated healthcare developers, UI/UX designers, business analysts and compliance specialists are known for their Canadian standards of work and American standards of innovation.
What we promise to deliver in addition to our development expertise is help with every business aspect including defining the business model and finding revenue streams.
Meaning, we’re well-equipped to lead your way through technical, business and compliance challenges to the core of your users’ hearts!