With ever increasing pressure on margins and with the continuing competition from supermarkets, it is essential to develop a higher profit margin contribution to your pharmacy business from other sources.

A large number of independent pharmacies have managed to increase their turnover and profitability over the past ten years or so by introducing one-hour film processing and, more recently, by providing digital printing services. On-site minilabs and digital photo printers have proved successful in increasing customer traffic through stores as well as having a positive effect on the rest of the pharmacy business. Photographic customers, who would not normally shop in a pharmacy, now become potential pharmacy customers and sales of traditional pharmacy lines increase.

Each camera memory card, CD or roll of film brought in usually involves two visits by the customer, increasing the opportunity for impulse purchases. The advent of digital imaging has reshaped the world of picture-taking. In recent years the photo market overall has been going through a period of great change as a result of the digital revolution. It has caused many ups and downs, initially having an adverse effect on high street minilabs as users experimented with home printing and did not have as many prints made as previously with film cameras.

However, there is strong evidence that digital printing of photographs at home is declining, mainly because of its expense. There is a definite trend for the consumer to switch from home printing to retail printing. In 2004 UK home printing accounted for around 70 per cent of all digital prints produced. In 2005 it was 61 per cent and the Photo Marketing Association (PMA) estimated that in 2006 it would be under 50 per cent, with retail printing being the major beneficiary of the switch.

Customers are increasingly becoming involved in all things digital, and well over 70 per cent of households now own a computer. The sale of digital cameras is increasing in leaps and bounds and has taken over largely from traditional film cameras. The quality of digital cameras has improved enormously and the cost of entry-level models has come down dramatically, encouraging more and more consumers to buy.

A UK survey carried out by the PMA at the end of 2005 showed that 6.1 million digital stills cameras (including 200,000 DSLR cameras) were sold compared with only 600,000 film cameras. At their height, film cameras had a household penetration in the UK of over 80 per cent. The household penetration of digital stills cameras is approaching 50 per cent. The research also showed that 39 per cent of UK households had films or single-use film cameras processed in 2005, so there is still life in film.

The popularity of camera phones, with a 50 per cent penetration of UK households, is not having a significant impact on the retail photo processing market, with only 9 per cent of camera phone images being made into prints, according to the latest PMA estimates. Digital technology is increasingly opening up many new profitable business opportunities. This is the time for go-ahead independent pharmacies to add a digital printing service to their business. It is a proven way to improve turnover and profitability.

Low-cost digital minilab packages are now available as never before; counter-top digital photo printers, which can be connected to a PC with easy-to-understand front-end software installed, give a simple and economical way to start providing high-quality digital services.

A customer kiosk, which can be linked to a minilab or a digital photo printer, allows customers to input their own orders, saving staff time. Evidence shows that customers like the hands-on approach. They can easily select the images they want and manipulate them if they wish.

The latest digital photo processing equipment available to retailers has enhanced print quality to a new high standard and our experience shows that customers are ordering more prints and having more enlargements made as a result. Digital processing can also make the production of specialist prints easier and far more cost-effective for customers.

By adding a digital printing capability to your business you can offer a wide range of new photo services catering to a professional and commercial market as well as the general public. With digital minilabs, you can handle both film and digital media, produce prints from prints, prints from slides, carry out picture manipulation and restore old pictures to new, for which there is great demand. You can also print from digital still camera memory cards or CDs, produce images to digital media, and send or receive pictures online via the Internet.

Digital capability can enable you to provide greeting cards, invitations, ID photos, photo business cards, apply special effects to prints and produce index prints for easy re-ordering. In the past few years there has been a growing number of excellent digital minilabs offering highly advanced capability. They are designed to be user-friendly, easy to understand and to operate. Little technical training is needed and considerable after-sales support is normally available.
 
Go-ahead retailers are continually exploring the unprecedented business opportunities that the new technology can provide – email, e-commerce and the Internet. You can now be open for business 24 hours a day. Discovering what your customers want and interesting them in the digital photo services you can provide is the key to success.

Before making any decision on buying new equipment, you should take a close look at what is available and arrange to have demonstrations of the machines, so you can judge their performance. New digital machines are being introduced onto the market continuously. It can be a sizeable investment and so you have to be sure you are buying the most suitable equipment for your current and projected needs. Finance packages are available to enable most potential purchasers to acquire new photo processing equipment in the most cost-effective way.

Although film processing is declining rapidly, an important consideration that can significantly affect your profitability is whether or not you tie yourself to one particular manufacturer’s processing materials. Many people like to remain flexible in this area and take advantage of different manufacturers’ special offers.

If a pharmacy has the space to install a compact minilab or a counter-top digital photo printer, perhaps replacing an unprofitable area in the retail shop area or siting it in a back room or basement, the on-costs are shared with the rest of the pharmacy business, making it easier to cope with the overheads of operating a photo lab. Minilab manufacturers will be pleased to advise on the space and any special requirements you will need.

As well as operating on-site photo processing, it is important to maximise linked sales by stocking a good range of profitable ancillary photo products: media cards, films, single-use cameras, frames, albums, batteries etc.

One pharmacy to purchase a digital minilab recently is Albert Wilde Pharmacy, situated in a busy health centre in Fleetwood, Lancashire. Owner Aisling O’Brien says: “My experience since having the digital minilab is that footfall through the pharmacy has greatly increased and our business is growing. I find many customers bring in their digital media and films for one-hour processing when they bring in their prescriptions. While they are waiting to collect their prints, they have the opportunity to impulse buy in the pharmacy.”