How to Start an Online Medicine Delivery Business: A Step-by-Step Guide!

What is an Online Medicine Delivery Business?

Let’s suppose you have a diabetic patient at your home. A chronic disease like diabetes requires regular medicines or injections to control blood sugar. As a result, you visit the medical shop at the start of every month to get your monthly medical supplies.

However, what if ( for some reason) you cannot visit the medical shop? This is where online medicine delivery apps come into play!

Through these online medicine delivery apps, you can order all your medicines within a few clicks and get them delivered to your doorstep. Apart from medicines, they also sell health and hygiene products, nutritional supplements, medical devices, and more.

The best part is some of these apps offer more than the traditional 10% discount on medicines.

That’s not it! These apps also remind you to refill your stock before you run out of medicines. They list the potential benefits and side effects of medicines, answer FAQs, and offer price comparisons, articles and blogs on a wide variety of topics.

Why Start an Online Medicine Delivery Business?

Did you know? As of 2022, the online pharmacy segment is expected to generate a whopping revenue of $22.50 billion worldwide. Let alone in India, it is expected to generate a revenue of 138 billion by 2024.

To benefit from this, a lot of stakeholders are pooling their resources and knowledge in this growing ecosystem.

A recent report by Statista suggests that as of 2019, only 47% of the online medicines market has been addressed in India. There’s still 53% of the market that needs to be addressed.

So, if there’s any right time to start a medicine delivery business, it is NOW!

If you need further convincing, check out the following benefits of starting a medicine delivery business.

1. Zero Retail Investment

If you’re a startup, you do not need to burn a hole in your pocket by investing in warehouses or retail stores. With the correct business model in place, you can set up a profitable business.

2. Fusion of Retail and Delivery

If you already have an existing medical shop, chances are you might be offering home delivery to limited customers or geographical areas. However, with a full-fledged medicine delivery system in place, you can grow exponentially and expand your business.

3. Serve Larger Audience

One of the best parts of operating a medicine delivery business is that you get to serve a large group of people. With a sound delivery network, interstate delivery becomes a possibility.  However, the delivery time might get extended.

Also, if you’re the sole seller of certain products or medicines then this model will give wings to your business.

4. Generate More Revenue

Apart from the margins on medicines, you can earn through advertisements and membership plans on the medicine delivery app. You can even expand your inventory by selling health and hygiene products, supplements, feminine products, etc. to earn better revenue.

How to Start an Online Medicine Delivery Business in India?

1. Create an Inventory List

Before starting, you need to have a clear idea of what products or services you’ll sell on your app. For this, a little market research is necessary.

Start by asking:

1. Which medicines yield more profit? Generally, pharmacy owners keep a 20-50% margin on generic medicines and 16-22% on branded medicines.
2. What other healthcare products can you sell on the app? This includes health and hygiene products, OTC medicines, medical devices, nutritional supplements, feminine, maternal, child care products etc.
3. Vaccines, insulin, and certain eye drops need to be stored at low temperatures. Are you equipped to store them?

Proper categorisation of products will help you to manage and sell hundreds and thousands of products on your app. Further, it will also facilitate easy navigation and offer ease of use to customers.

Moreover, over time, the products you sell will define your business and determine your brand USP.

For instance, Tata 1mg is a comprehensive health care app that offers allopathic, ayurvedic and homoeopathic medicines, and health and hygiene products. You can book lab tests, and doctor’s consultations and get covid support through the app. Also, you can maintain health records and set a pill reminder on the app.

2. Determine the Business Model

One of the most important things to figure out before starting an online medicine delivery business is; the business model.

Let’s walk you through it!

3. Operational Business Model

If you already have an existing pharmacy shop, this business model is for you!

In the operational business model, already existing pharmacy owners tap into the world of digital by creating their own medicine delivery app. The customers can browse through the product categories and place their orders. Later, the retailers pack and deliver the order to the customer’s doorstep.

This model allows the local retailers to expand their business, and generate better revenue and brand recognition.

For instance, Wellness Forever is one of the leading online pharmacies in the country. It has over 200 outlets and a sound medicine delivery system in place. They sell almost all pharmaceutical and health and hygiene products.

4. Marketplace Business Model

The marketplace model works by collaborating with local brick and mortar pharmacies. In this, the online pharmacy partners with local pharmacies in an area. When a customer orders medicine on the app, the nearby pharmacies are notified. The pharmacy which has all the products then accepts the order and proceeds to deliver it.

Further, a delivery partner collects the order from the pharmacy and delivers it to the customer. The revenue from this is shared by the online and local pharmacies based on the agreed terms and conditions.

This business model helps entrepreneurs to save up on infrastructure and inventories. They can then channel the resources and funding into managing the core business operations. It is also effective in reducing monopoly and benefits both online and local pharmacies.

5. Conduct Market Research

What is your target area? Do you wish to start from the local level and then move on to delivering across the nation? Or do you want to start big and supply nationwide? Having a clear idea of the market size will help you in sound decision making.

Other important questions to ask are:

1. Who is your target audience?
2. What is their average monthly spending on medicine?
3. Do you wish to tie up with hospitals and clinics to supply pharmaceutical and surgical products?
4. Do you want to tie up with gyms and healthcare centres to promote and sell your nutraceuticals?
5. Which factors do your customers consider while choosing a medicine delivery platform- ease of use, fast delivery, hassle-free payment, discounts or a wide range of products?

Questions like these will help in doing your market research. Further, it will also allow you to get a better understanding of the industry and understand your customer’s preferences. Plus, it will help leaps and bounds while planning and executing your business.

6. Settle the Delivery Process

Undoubtedly, timely and smooth delivery is the key to success in the medical delivery segment. To ensure this, you can either partner with third-party delivery companies (such as Shiprocket, WeFast, Dunzo, Grab, etc) or set up your delivery system by hiring local delivery agents.

Also, make a note of solving the cold storage issue for medicines that need to be stored at low temperatures.

Moreover, to enhance the customer experience, you can allow users to track their orders on the app. You can even offer the delivery personnel’s contact details to customers.

mCommerce companies like PharmEasy are taking the game to another level by offering delivery within 24-48 hours in selected cities. Based on this, it’s safe to say that after some time, these online pharmacies might deliver in hours (if not minutes).

Sell Other Healthcare Products

Your online medicine delivery business can also be a marketplace of healthcare products. You can list various healthcare products and devices. Healthcare products like protein supplements, herbal juices, biscuits, and other healthcare supplements can be sold.

You can also consider listing other healthcare devices like BP and diabetes monitoring devices, and other hair and skincare products used in the daily routine.

This will help expand your clientele and boost your sales. You can even allow other healthcare brands to sell their products on your platform and take a fixed fee or commission per sale.

1. Name Your Business

Naming a business might sound like an easy affair to some however, it’s one of the most challenging yet often underestimated aspects of a business.

They say the first impression is the last impression and your business’s name is the first thing your customers notice. Don’t you want it to be everlasting?

A good domain name needs to be unique, short, sweet, and easy to remember. It must also resonate with your target audience. Also, ensure that your business’s name aligns with your USPs and future goals.

At the same time, stay away from using jargon, homophones and punctuations in your domain name.

One of the finest examples of good domain names can be PharmEasy. It’s unique, easy to remember and portrays the business’s core values (i.e. making pharmacy readily available to you).

Pro tip: For generating catchy domain names, you can take the help of online tools like Oberlo, Name Lix, and Name Mesh.

2. Register Your mCommerce Business

At present, there are no standard laws overseeing the e-pharma industry in India. However, there are a few laws which mCommerce companies need to comply with. These include:

• Drugs and Cosmetics Act, 1940
• Drugs and Cosmetics Rules, 1945
• Pharmacy Act of 1948
• IT Act, 2000

Apart from this, to operate your medicine delivery business, apply for the central licensing authority from the central government’s portal.  Also, you might have to pay a sum of 50,000 rupees for getting the licence.

Registering your mCommerce business might be a tricky affair. Thus, taking legal advice from professionals is recommended.

3. Pickup The Best App Development Company

Your mobile app is a core part of your business. It gives a unique identity and adds vitality to your business. Further, it acts as your virtual store where you interact with your customers

Having a flawless mobile app is imperative in the medicine delivery segment. Apps that are slow and have technical glitches are often disliked by users.

How do you create a flawless medicine delivery app? Simple! By choosing the right app development company.!

But, how do you find the best mobile app development company? Here are a few things to keep in mind:

• Check their portfolios.
• Ask for client testimonials.
• Ask what the process of app development will look like.
• Also, see if they have a qualified and dedicated team of professionals.
• Ask about the tech stack they’ll use for creating your medicine delivery app.
• Schedule a meeting to see if they’re cooperative.
• Ask about the post-delivery services.

(If you’re looking for an efficient app development company, check out our medicine delivery app solutions and get onboard. Let’s together make your dream business a reality!)

Shortlist the Features of Your E-pharmacy App

What distinguishes an ordinary app from an extraordinary one is; its features. While shortlisting the features of your e-pharmacy app, aim to ease the lives of your users, vendors, delivery personnel (and of course the admin!).

You can be creative and add as many features as you want. However, don’t forget to add the following features if you want to take the game to the next level!

• Allow users to maintain a digital health record on your app. If you’re planning to add online doctor’s consultation on your app, this feature is unavoidable.
• Make reordering easier.
• Maintain order history and offer it to customers.
• Reminder for restocking the medical supplies.
• Real-time order tracking.
• Price and order management options for vendors to fluctuate the prices and add/remove products.

1. Inventory Management

Inventory management is a pivotal part of your business if you’re working on the operational business model. Restocking the supplies and updating the app regularly must be your utmost priority.

Also, with the help of analytics, you can gather insights into best-selling or least selling healthcare products. Later, you can channelise your resources and drive marketing campaigns to boost the sales of the same.

Online pharmacies operating on a marketplace business model don’t have to fret over inventory management as this burden falls on local vendors. However, to stay on top of the game, you must tie up with efficient pharmacies and retailers.

2. Setup a Simple and Secure Payment Gateway

A poor payment experience can frustrate the users and discourage them from making the purchase. As a result, it can negatively affect the sales of your business.

To avoid this, integrate your app with the best-in-class payment gateways. They are safe, secure, quick and offer 100% customer satisfaction. A few examples of them would be PayU, RazorPay, PayPal and cc avenue.

Looking for the best payment gateways? Read our blog on the same!

Set Up a System for Verifying Orders for Prescription Medicines

One of the important (and somewhat tricky) tasks in the medicine delivery business is; verifying the prescription for selling prescription medicines. Though it’s a hassle, it’s necessary. However, by employing a few strategies, you can simplify this.

You can allow customers to upload prescriptions from their gallery within a few clicks. To make the verification process quick, you can onboard a few doctors. Also, you can save customers from the hassle of uploading the prescription while ordering the same medicine again.

1. Make Reordering Easy

Patients with chronic illnesses such as asthma, diabetes, high blood pressure or those with mid-term diseases often need medicines regularly. You can save up their order history and make reordering easy.

It’s a win-win situation for both businesses as well as customers.

2. Develop a Phenomenal Mobile App!

Once you’ve onboarded a good app development company and have clarity around your business, you can initiate the app development process.

You can keep in touch with the developing team and ask them to share the UI and UX screens for your approval. Further, you can give a green signal to proceed or suggest changes as necessary.

Also, scrutinise the admin panel as you’ll be managing your business from there. It must be free from glitches and consist of all important metrics and reports.

Lastly, keep the stream of communication moving seamlessly among you and your app developing team. Share your concerns and feedback and at the same time be open to suggestions.

3. Beta Testing is Crucial!

Let’s admit, no matter how sound planning you have, unless you get first-hand experience, you won’t know where you’re doing well and where you need improvement.

Beta testing is one of the best ways to gather this experience. In this, you launch your business among limited users. It allows you to get genuine customer feedback and fix the bugs and glitches before the actual launch of the app.

4. Launch, Market and Grow!

Hurray! You’ve come all the way. It’s time to give yourself a little pat on the back and get ready for the actual launch of your medicine delivery app. You can use social media to promote the launch event of your business. You can even offer discounts and coupons for the first X number of users.

To improve your Playstore ranking, you can encourage people to rate and review your app on the same.

Further, you can reward your users every time they share your app with their friends and family. By leveraging the power of SEO, SEM, social media marketing, and various other app marketing strategies, you can take your business to the next level.

As you go along the way, keep improving, stay updated and grow your business.