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Thinking of a Medical Store or Pharmacy Business? We will be happy to help you.

Opening a medical store requires many registrations and must follow legal procedures before selling medicines. Establishing a medical store is a good option for entrepreneurs having less capital and want to invest in the healthcare sector.

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    PROCESS OF STARTING A MEDICAL STORES BUSINESS

    • Choose the Type of Medical Store

      There are different types of pharmacy businesses you can start such as Hospital medical store, Standalone medical store, Chain pharmacy or franchise outlets, Stores in government premises etc.

    • Conduct Market Research

      • Identify customers (Patients, senior citizens, doctors, hospitals, clinics, and health-conscious individuals.)
      • Customer Needs, Target Audience, Seasonal Demand, Analyse Competitors.

    • Register Your Pharmacy Business & Obtain Licenses

      • Business Registration: Register as a Private Limited Company, LLP, or Sole Proprietorship.
      • GST Registration, FSSAI License, MSME Registration, Retail Drug License, Pharmacy Licence, Medical store registration etc.

    • Secure Investment & Funding

      • Self-Funding: Personal savings or bank loans.
      • Bank Loans: Government schemes like Mudra Loan (PMMY) or MSME loans from banks & NBFCs.

    • Choose a Strategic Location

      • Near hospitals, clinics, or residential areas for high customer footfall.
      • Ensure proper storage conditions (temperature control for sensitive medicines).
      • Sufficient space (minimum 10 sq. meters required for a retail pharmacy).

    • Stock Procurement & Supplier Tie-ups

      • Wholesale Distributors & Stockists (Apollo, MedPlus, local distributors).
      • Direct Tie-ups with Pharmaceutical Companies (Cipla, Sun Pharma, Lupin, Dr. Reddy’s).
      • Online B2B Platforms (PharmEasy, Netmeds, 1mg for bulk orders).

    • Set Up Inventory

      • Maintain stock of prescription drugs, OTC medicines, first-aid kits, syrups, medical devices, and supplements.
      • Use inventory management software to track stock levels and expiry dates.

    • Hire Trained Staff & Pharmacists

      • At least one registered pharmacist is mandatory.
      • Hire salespersons with knowledge of medicine names and their uses.
      • Train staff in customer handling, billing, and prescription reading.

    • Marketing & Customer Acquisition Strategy

      • Register on Google My Business to improve online visibility.
      • Attractive store design & signage to attract customers
      • Collaborate with doctors & hospitals for referrals and Offer discounts & loyalty programs.

    TYPES OF MEDICAL STORE BUSINESS

    HOSPITAL MEDICAL STORE

    It is a medical store opened inside the hospital to cater to the needs of the patients who come to the hospital.

    STANDALONE MEDICAL STORE

    It is the most common form of medical store. It is small or medium-sized stores opened in residential areas that the residents visit to purchase essential medicines.

    CHAIN PHARMACY OR FRANCHISE OUTLETS

    These are medical stores in malls and shopping complexes and are part of a chain of pharmacies with branches in different areas. They are usually large-sized medical stores.

    TOWNSHIP MEDICAL STORES

    These types of medical stores are opened in a township to cater to the needs of the people residing in the town or a village.

    STORES IN GOVERNMENT PREMISES

    These medicine stores are opened under various government policies and schemes and are directly under government control. They are usually opened inside Government offices and buildings.

    AYURVEDIC & HERBAL MEDICINE STORE

    Ayurvedic medicine is a traditional Indian medical system that uses herbs and other natural treatments to promote health and balance. It’s a type of complementary and alternative medicine (CAM).

    REQUIREMENTS OF MEDICAL STORE BUSINESS

    FINANCE AND CAPITAL

    Evaluate the financial requirements and determine how much capital you will need. Generally, the financial need depends on the size and scale of your business. So, look at your savings and assets and see if they are enough to set up a medical store.

    AREA SPECIFICATION

    According to the Drug and Cosmetic Act in India, a retail medical store needs a minimum area of 10 square meters to operate, while a store combining both retail and wholesale operations requires a minimum of 15 square meters.

    BUILD PARTNERSHIP

    Direct partnerships with pharmaceutical companies & distributors, collaborate with Local Doctors & Clinics and medicine platforms, Tie-up with Hospitals & Nursing Homes, help you get medicines at wholesale rates, ensure a consistent supply of stock, access to special discounts, offers, and credit facilities.

    STORAGE FACILITY

    Medical stores must be equipped with an air conditioner or refrigerator since the labelling specifications require that certain drugs, like insulin injections, vaccines, sera, etc., should be stored in the refrigerator.

    TECHNICAL STAFF

    • For wholesale business: The sale of the medicines should be made only in the presence of a registered pharmacist with more than one year of experience.
    • For retail: The sale of medicines should be made in the presence of a registered pharmacist during working hours.

    CUSTOMER SUPPORT & SERVICE

    Providing excellent customer support is essential for building trust, retaining customers, and increasing sales in a medical store.

    DOCUMENT FOR MEDICAL STORES BUSINESS

    MEDICAL STORE REGISTRATION

    The medical store is required to be registered as a sole proprietorship, partnership firm, LLP, or company are applicable.

    PHARMACY LICENCE

    A pharmacy licence is one of the major licences required to operate a medical store. The medical store owner or the appointed pharmacists should be qualified pharmacists with a degree of B. Pharm or M. Pharm to secure a pharmacy licence.

    SHOP AND ESTABLISHMENT REGISTRATION

    The shop and establishment act registration is required for all medical stores to operate their business. As per the municipal rules of the respective state/area municipal corporation, all stores/shops must mandatorily obtain a registration under the respective state’s Shop and Establishment Act.

    GST REGISTRATION

    Any business, including a medical store, requires a Goods and Service Tax (GST) registration if the aggregate turnover of the business exceeds the threshold limit in a financial year as prescribed under the GST Act. Under the GST Act, any business supplying goods having a turnover beyond the threshold limit of Rs.40 lakhs for normal category states and Rs.20 lakhs for special category states in a financial year must obtain GST registration.

    DRUG LICENCE

    • Retail drug licence:The retail drug licence is required to operate a general chemist shop. This licence can be done only in the individual’s name who possesses a diploma or degree in pharmacy from a recognised university or institute.
    • Wholesale drug licence:The wholesale drug licence is given to medical stores dealing in the wholesale business of medicines and drugs. There are less stringent conditions to obtain this licence than a retail drug licence.

    FSSAI REGISTRATION

     If your business deals with nutritional supplements, protein powders, or Ayurvedic medicines, you need FSSAI (Food Safety and Standards Authority of India) registration.

    MSME/UDYAM REGISTRATION

    Consider registering your business as a Micro, Small and Medium Enterprise (MSME) or Udyam. This can provide various benefits and incentives.

    NOC FROM LOCAL MUNICIPALITY

    For operating a pharmacy or medical store, you may need a No Objection Certificate (NOC) from the local municipal corporation

    POLLUTION CONTROL BOARD CLEARANCE

    If manufacturing medicines, you may need clearance from State Pollution Control Board.

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    Compare with other Medical Stores Business

    Pick a Business Structure That Works Best For Your Business

    • Initial Investment
    • License & Approvals
    • Profit Margin
    • Target Customers
    • Operational Complexity
    • Revenue Potential
    • Competition Level
    • Stock Requirements
    • Staff Requirement
    • Risk Factors
    • Best for Entrepreneurs Who

    Hospital Medical Store

    • 10-50 lakh
    • Strict regulations, Hospital tie-up needed
    • 15-30%
    • Patients, Hospital staff
    • High (hospital policies, strict inventory control)
    • High (steady flow of hospital patients)
    • Low (hospital exclusive)
    • Hospital-specified medicines & equipment
    • Pharmacist + multiple assistants
    • Dependency on hospital policies
    • Have hospital contacts & healthcare experience

    Standalone Medical Store

    • 5-20 lakh
    • Standard drug license, FSSAI, GST
    • 20-40%
    • General public, Nearby clinics
    • Medium (inventory & prescription management)
    • Medium to High (based on location)
    • High (multiple local pharmacies)
    • General medicines, OTC drugs, supplements
    • Pharmacist + 1-2 staff
    • High competition & price war
    • Want independent pharmacy ownership

    Chain Pharmacy or Franchise Outlet

    • 20-50 lakh
    • Franchise agreement, Drug license, GST
    • 10-25%
    • Mass consumers, Online & offline buyers
    • High (brand standards, franchise compliance)
    • High (due to brand recognition)
    • Very High (national-level competition)
    • Standardized stock as per franchise
    • Pharmacist + Franchise-trained staff
    • Franchise fees & profit sharing
    • Prefer brand association & scalability

    Township Medical Store

    • 10-30 lakh
    • Municipal approvals, Drug license
    • 20-35%
    • Residents of township
    • Medium (local demand, stock control)
    • Medium (depends on township size)
    • Medium (depends on township size)
    • Local demand-based stock
    • Pharmacist + Delivery service (optional)
    • Limited market size in township
    • Want local monopoly in residential areas

    Stores in Government Premises

    • 5-15 lakh
    • Government tender & approvals
    • 10-20%
    • Government employees & patients
    • High (government regulations, procurement)
    • Medium (limited to government policies)
    • Low (limited entrants)
    • Government-approved stock only
    • Pharmacist + Government-approved personnel
    • Government dependency
    • Can navigate government procedures

    Ayurvedic & Herbal Medicine Store

    • 3-10 lakh
    • AYUSH certification, FSSAI, GST
    • 30-50%
    • Herbal & wellness product consumers
    • Low (AYUSH-compliant stock management)
    • Medium to High (niche but growing demand)
    • Medium (competing with allopathy)
    • Herbal, Ayurveda & wellness products
    • AYUSH-certified pharmacist (optional)
    • Niche market with slow growth
    • Have Ayurvedic knowledge & customer base

    Here are some Frequently Asked Questions about Medical Stores Business

    What are the licenses required to start a medical store in India?

    To start a medical store, you need the following licenses:

    • Drug License from the State Drug Control Department (Retail Drug License & Wholesale Drug License)
    • GST Registration
    • Business Registration (Sole Proprietorship, Partnership, or Private Limited Company)
    • Shop and Establishment Act Registration
    • FSSAI License (if selling health supplements)
    • Local Municipality or Trade License

    What is the minimum qualification required to open a medical store?

    You need to be a registered pharmacist (B.Pharm or D.Pharm) or hire a qualified pharmacist to obtain a drug license.

    How much investment is required to start a medical store?

    The investment varies based on location and store size:

    • Small medical store: ₹5-10 lakhs
    • Medium-sized store: ₹10-20 lakhs
    • Large pharmacy with online service: ₹20-50 lakhs

    What are the key documents required for a drug license?

    • Pharmacy qualification certificate (if applicable)
    • Premises ownership proof or rental agreement
    • Layout plan of the shop
    • Identity & address proof of owner
    • Affidavit stating compliance with drug laws
    • Refrigerator purchase bill (for storing temperature-sensitive medicines)

    What are the common challenges faced in the medical store business?

    • High competition from large pharmacy chains
    • Inventory management issues leading to stock shortages or expiries
    • Compliance with strict drug laws and inspections
    • Credit issues with customers and suppliers
    • Finding and retaining a qualified pharmacist

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