How to Open a Medical Store or Pharmacy in India – Step by Step Guide
In India, establishing a medical store or pharmacy is regarded as one of the most stable and lucrative business opportunities in the healthcare industry. As the number of medications, health and wellness products continue to rise steadily, the pharmacy business is able to grow rapidly. Many individuals would like to start their medical shop, however, they have great confusion with the legal process and requirements they need to complete. For those individuals planning to open or interested in establishing a medical store in India, well, this article will guide you through, step by step, all the important points you need to know.
Why should someone own a medical store in India?
Before we look into the complete process, we should discuss why a pharmacy is a good option. Healthcare is required in India, and medicines are required every day. Pharmacies are a recession proof industry for that very reason. As you learned from COVID-19, medicines and health products were very much still in demand among those tough times.
Beyond profitability, owning a pharmacy allows one a certain level of respect because you are helping people get medicinal access and healthcare support.
Types of Medical Shops in India
There are various types of medical shops you can open based on your investment and business model.
Retail Pharmacy – This is the common pharmacy model everyone knows where customers use a doctor’s prescription and purchase medicines.
Wholesale Pharmacy – These medical shops deliver medicines to retail medical shops, hospitals and clinics.
Franchise Medical Store – You can collaborate with a pharmacy company like Apollo, MedPlus or Wellness Forever as a franchise owner.
Online Pharmacy – A model where you sell medicines using an e-commerce model website or delivery app. This model has become popular due to the increasing acceptance of digital health care.
Hospital Pharmacy – These pharmacies are located in or near hospitals with customers being admitted patients and outpatients.
Eligibility Criteria to Open a Medical Store
Under the relevant provisions of the Pharmacy Act, 1948 and Drugs and Cosmetics Act, 1940 there are strict eligibility requirements to open a medical store, not just anyone can open a medical store.
Pharmacist – One of the requirements is a qualified pharmacist is one with a Diploma in Pharmacy (D. Pharma) or Bachelor in Pharmacy (B. Pharma) and must be registered by the State Pharmacy Council.
Ownership – It is possible to own a medical store without being a pharmacist. If you own a medical store, you can employ a licensed pharmacist.
Licenses and Permits Required
The following licenses and registrations are required to operate a pharmacy legally in India :
Drug License; Issued by Central Drugs Standard Control Organization (CDSCO) or your State Drugs Control Department. You cannot sell any medicine without having this license.
Pharmacy License: If you are a pharmacist, you must register with the State Pharmacy Council.
GST Registration: Required for tax and compliance and issuing a bill.
Shop and Establishment License: Mandatory requirement that applies to any commercial establishment.
Company Registration: If you are starting as a partnership, LLP or private limited company.
FSSAI License: If you intend to provide services or sell health supplements/wellness products etc., you will need to get this license.
Location and Infrastructure Obligation
The success of your pharmacy is highly dependent on the location. An ideal medical store will be near hospitals and/or clinics or even better in an area where there is a large, sufficient residential population and well located to obtain footfall.
There are certain infrastructure requirements of Drug and Cosmetics act stated below:
Retail Store: minimum area of 10 squared meters.
Wholesale Store: minimum area of 15 squared meters.
Adequate storage and facilities such as refrigerator and Air conditioning if you are stocking pharmacy medicines requiring cold storage.
It is also a requirement to ensure adequate ventilation, cleanliness and lighting
Cost of Starting a Medical Store
The initial cost will depend on the store type and scale. Generally:
– Small Retail Store: ₹5–10 lakhs (including shop rent, interiors, licenses, and stock).
– Wholesale Pharmacy: ₹10–15 lakhs.
– Franchise Store: ₹15–20 lakhs (depending on brand).
– Online Pharmacy: More technology and logistics investments.
The medicine stock is the biggest expense; normally, would be ₹2–4 lakhs for a small retail store.
Open a Medical Store in Simple Steps
Here are simple steps to establishing a Medical Store:
1. Prepare a Business Plan – Decide between retail, wholesale or franchise pharmacy.
2. Location – Need high demand with easy access.
3. Hire a Pharmacist – If you’re not a pharmacist you will need to hire one.
4. Application for Drug License – File application in the State Drug Control Department with all required documents.
5. Get other Registrations – GST, shop license, and if needed, company registration.
6. Store Design – Put all shelves in place with storage facilities, computer billing system, and if needed, refrigerators.
7. Stock Purchase – Tied up arrangements with medicine distributor and wholesalers.
8. Hire Staff – Besides pharmacist you may want to hire helpers or billing staff.
9. Market Your Store – Make local advertisement, pamphlets distribution, or tie up with local clinics.
- Documents Needed for Pharmacy License
- When applying for a drug license there need:
- Application form with fees.
- Evidence of pharmacist qualification (D. Pharma/B. Pharma certificate).
- Pharmacist registration certificate with State Pharmacy Council.
- Rent agreement or proof of ownership of the shop.
- Layout/Blueprint of the site.
- Bill of refrigerator for cold chain medicines.
- Id proof and photographs of owner.
- The Profit Margin in Medical Stores
- A good thing about the pharmacy business is the profit margin. Typically one can expect:
- Branded Medicines – 15% to 20% margin.
- Generic Medicines – 30% to 60% margin.
- Surgical Products & Health Supplements – 20% to 50% margin.
If your store is well situates, it can easily earn ₹1-2 lakhs per month after expenses within a year of opening.
The Future of Pharmacy Business in India
The pharmacy sector in India is growing rapidly with a huge rise in population, health consciousness and digital healthcare. Popularity of online pharmacies and home delivery of medicines is here to stay. If you are able to combine a physical store with online delivery, your chances of success would be greatly increased.
Conclusion
The pharmacy and medical store business is an exciting business proposition in India, both financially and socially. Given the right planning, necessary licenses, and good location, you can successfully run your own pharmacy. The demand for medicines would never stop and if you offer genuine service and price reasonably, your store will flourish.
If you are committed to starting a pharmacy, you should formalise your thoughts into a plan and better understand the legal obligations to operate legally and in a way that builds trust with your customers. Beyond profits – a professional pharmacy can serve our society and provide critical health care access.
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