Pharmacist Financial Blog

Developing A Junior Partnership

Posted by Benjamin Coakley on Nov 14, 2018 8:30:00 AM

 

Pharmacist Financial_RGB

 

A WaypointRx Company 


We've been hearing from a lot of you about potentially starting a junior partnership, so we have decided to create a blog post with some helpful information for you to get started. This post is for both pharmacy owners and potential junior partners, so please share it with anyone you feel could benefit from it. 

HandshakeTWDS

 

There are lots of things to consider before implementing, as junior partnerships are not for everyone. Our goal is to provide them with things to consider before taking next steps.

 

 

First and foremost, it is important that both the pharmacy owner and the junior partner be themselves. The best partnerships are based on authenticity, communication, mutual trust and respect. If you can’t be yourself with the person you are attempting to go into business with – it might be worth reconsidering.

 

As a potential junior partner, you will need to first determine if a junior partnership is right for you. Start by asking yourself the following questions.

  1. Do I want to own a community pharmacy?
  2. Am I looking for a new challenge in my pharmacy career?
  3. Am I willing to work hard and sacrifice now, to potentially achieve greater success down the road?
  4. Could I benefit from learning from someone that has already been successful in his or her pharmacy life?
  5. Are you excited by the possibility of being a junior partner?
If you answered No to any of them, then a junior partnership might not be right for you.
If you answered ‘Yes’ to all of the above, then we recommend considering taking the following steps.
  1. Write out a business plan for the pharmacy.
    There are a multitude of samples online for your reference. The goal here is to get you thinking about the pharmacy from a business owners’ standpoint. Once you have one developed, you can take it to the pharmacy owner to show that you not only have thought about how to better the business but are willing and able to develop a plan to help it succeed.
  2. Take a business and/or leadership class
    Take the initiative to learn more about running a business and managing people. This is something that a lot of new pharmacy owners struggle with – as many don’t have any experience with either.
  3. Ask to take over some managerial responsibilities
    Get your feet wet in the world of management by talking with the pharmacy owner about taking on more responsibilities. Test your strengths and find out your weaknesses so that both can be fine-tuned prior to the junior partnership’s completion.
As someone who is looking to have a junior partner, you too will need to ask yourself some basic questions.
  1. Do I want to take on the responsibility of being a trainer and mentor?
  2. Am I willing to delegate vital tasks to another person?
  3. Does the idea of developing a succession plan interest me more than selling my pharmacy outright?
  4. Do I trust the person(s) who would become my junior partner?
If you answered No to any of them, then a junior partnership might not be right for you.
If you answered ‘Yes’ to all of the above, then we recommend considering taking the following steps.
  1. Develop a written plan for how the junior partnership will work, including timelines and responsibilities.
  2. Have the junior partner write a business plan. most pharmacy owners will require the potential junior partner to write a business plan to describe how the business will survive into the future. It is imperative that the potential junior partner be familiar with this process because this can be a roadblock in the process.
  3. Start handing off small managerial duties to the junior partner to ensure they can handle it. Be sure to include duties from a variety of areas (HR, Operations, Finance, etc) so you can work together on finding new ways to improve the pharmacy as well as hone their skills to prepare them for taking on more responsibilities.
  4. Get the junior partner in front of the customers. One of the major benefits of having a junior partner is the continued customer loyalty of your patients. By transferring ownership of the pharmacy to a junior partner who has been there for a while, your customers will maintain the trust that is built which will keep them coming back once the transition occurs. 

 

A while ago, we had a conversation with a client who had a successful pharmacy junior partnership.  We were curious what specifically in their relationship has made it so successful, so we asked them.  Here are some tips they had to share when recommending this type of relationship:

 

Junior Partner

- Use a probationary period to make sure you are combatable with the senior partner

- Get something in writing that addresses how long this “probationary period” will be and how ownership will transfer afterwards

- Do not be greedy.  The partnership and business must be more important that just making money

 

Senior Partner

- This is a great way to carry on the legacy of the pharmacy and continue to take care of your patients and community

- This is the closest relationship other than being married and choosing the correct person is a crucial decision

- Use multiple third-party valuations when deciding on sales price and throw out the highest and the lowest to reach a price and avoid animosity

 

One thing they both stressed is that the willingness to work together is critical.  They are a team when it comes to decision making and often must compromise. They both also said that they trust the pharmacy is in good hands when the other is working.

 

To review, there are 4 main benefits to implementing a junior partnership.

  1. Continuity of customer service - The junior partner can learn the level of customer service to which a pharmacy's patients are accustomed. This will give the junior partner a better chance of succeeding once the owner transitions out.
  2. Processes can be already known and understood - The management of the store can be the biggest hurdle for most new pharmacists owning a pharmacy. This allows them to be trained in a real-life environment which gives them a better chance of survival.
  3. Same ideals and values shared - This gives the owner the ability to see if the junior partner has the same values system before the store is completely turned over to that pharmacist. If the junior partner does not, then the owner can choose not to move forward with the transition.
  4. Credibility and customer loyalty more easily transferred - This one is fairly self-explanatory because a junior partner will have more credibility because he or she has been chosen by the owner. The transfer of credibility and customer loyalty will ultimately determine if the pharmacy will be successful into the future or not.  This is why some junior partners will want the owner to sign an agreement requiring them to work for a couple of years after the transition.

Owning a community pharmacy involves much more than just filling prescriptions. It is a rewarding career choice that offers many challenges. For those starting out with the goal of owning a community pharmacy, it is difficult to map out a long-term career plan. Download The Young Pharmacist Prosperity Kit from our store to help you get started on the path towards pharmacy ownership. 

 

Download the Junior Partner Tool

Use the code JRPARTNER at checkout for 10% off!

 

 


For more information, click the button below and set up an appointment with one of our advisors. 

Contact Joe Casselman

We also recommend you visit http://www.waypointus.com/pharmacist-financial-webinars and check out our free webinar on Establishing A Game Plan for additional tips and tricks for finding and following your financial goals.


At WaypointRx & Pharmacist Financial, we take pride in helping pharmacy owners & staff pharmacists reach financial goals, make educated decisions, & develop financial plans that work best for their unique needs. Over the years we have helped hundreds of pharmacists enjoy inspired independence by achieving greater personal and financial success. As we begin each relationship, we invest a lot of time and effort in the discovery and clarification of each pharmacist’s unique situation and, most importantly, their financial goals.

Send me info on the Pharmacist Financial Program!


Advisory services are offered through Waypoint Strategic Advisors, LLC, a Registered Investment Advisor in the state of South Carolina.

Insurance products and services are offered through [Insurance company name], an affiliated company.

All matters discussed in this blog are for informational purposes only. Opinions expressed herein are solely those of Waypoint Strategic Advisors, LLC and our editorial staff. Material presented is believed to be from reliable sources; however, we make no representations as to its accuracy or completeness. All information and ideas should be discussed in detail with your individual adviser prior to implementation.

The presence of this web site shall in no way be construed or interpreted as a solicitation to sell or offer to sell advisory services to any residents of any State other than the State of South Carolina or where otherwise legally permitted.

Waypoint Strategic Advisors, LLC is not affiliated with or endorsed by the Social Security Administration or any government agency, and are not engaged in the practice of law.

Content should not be viewed as an offer to buy or sell any of the securities mentioned or as legal or tax advice. You should always consult an attorney or tax professional regarding your specific legal or tax situation.  

Tags: Blog, pharmacist financial, pharmacy junior partners, junior partner