Drugstore chains continue growth momentum

Leading players in the pharmaceutical retail market, including FPT Retail, An Khang, and Pharmacity, are ramping up expansion efforts, giving birth to the modern pharmacy model.

Retail pharmacy chains are sparing no effort in their coverage expansion

2022 was a bonanza year for FPT Retail as the company reached the 1,000 Long Chau pharmacy mark early last month, securing a bigger piece of the pie in a market that is enjoying such robust growth.

According to Nguyen Bach Diep, chairman and CEO of FPT Long Chau, achieving the 1,000-store system and a presence in 63 localities throughout the country in such a short time marks a major milestone for the company, surpassing 125 per cent of its expansion plan for 2022.

Last year, the Long Chau pharmacy chain generated $285.3 million in total revenue, equalling a 2.6-fold jump on-year.

Over the next five years, FPT Retail aims to boost the number of Long Chau pharmacies to 3,000, with 600 outlets being launched this year.

Meanwhile, the An Khang pharmacy chain, operated and managed by Mobile World Group – Vietnam’s largest consumer electronics retailer – currently consists of 529 outlets.

Despite slower growth compared to its rivals, An Khang also shows strong potential and has caved a spot among Vietnam’s top three pharmaceutical retailers, behind Long Chau and Pharmacity.

For its part, Pharmacity, belonging to Pharmacity JSC which is owned by Mekong Capital – a large Vietnam-focused private equity firm – has opened nearly 1,100 drugstores and eyed double-digit growth in the past years.

The three pharmacy chains aim to scale up their drugstores to about 10,000 units by 2025.

According to global market research organisation IQVIA, modern pharmacies will swell in number in the years to come and are striving to diversify their offerings to also include personal care products and cosmetics, complementing their revenue and profit figures.

Business opportunities for modern pharmacies are deemed considerable according to the World Bank forecast. The proportion of people aged 65 and above in Vietnam will have more than doubled by 2040, accounting for 18 per cent of the total population. This is likely to lead to increased demand and create growth space for retail pharmacies.

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