Case 1 - Guardian Healthcare

Analyze the business environment, study company's issues and suggest solutions for the same

C2G10 Team members

Name Roll Number

Aishwarya G V P FT213008
Debankar Moulik FT213025
Preethi S FT213061
Rohit Tapader FT213069
Shantanu Siddhartha FT213077
Siddhartha Jha FT213084
Utkarsh Mittal FT213093

Business Environment analysis-

The pharma sector in India is primarily unorganized and is likely to be organized in coming few days.
The PESTEL analysis of the business environment has been tabulated below –

Political Government entry in pharma sector could hamper business as

they could provide subsidized medicines
Pharmaceutical market showing healthy growth owing to
Economic occurrence of lifestyle diseases
Guardian's tie up with GNC is helping them with loyalty benefits
Industry's focus has shifted from sick-care to healthcare
Widespread sale of counterfeit/substandard drugs
Customer is unaware of the hygienic and mandatory practices
which should be adopted by pharmacies
Health insurance has become cheaper along with purchasing
power of the customer in India hence demand for better
Social
healthcare is rising
In rural areas, consumers do not have access to doctors and are
given loose medication by the pharmacists thus being susceptible
to overcharging
Younger Generation ready to pay more for better shopping
experience in Tier 1 & 2 cities
Technological Organized sector is willing to upgrade their IT Infrastructure
Medicines are packed using environment friendly materials
Environmenta
Expired medicines are destroyed using environment friendly
l
process
Online stores highly are unregulated
Legal Regulations and Government ban in FDI has resulted in low
investment in the organized pharma sector

Competition analysis-
Competition is with the traditional shops which form the part of unorganized sector and also with the
established players of the organized sector. The competition faced by Guardian Healthcare is
explained below –
Traditional shops (70% market share)–

 They are usually casual in maintaining the hygiene in their shops and the mandatory
precautions/practices are not adopted in selling and storing medicines. However, these are
near to customers’ homes and they are used to shopping there.
 Traditional pharmacies are not well regulated by the government and may employ child labor
and unqualified pharmacists. Not generating a bill helps them in tax evasion. This
subsequently enables them in earning higher profits.
Big players of organized sector (20-30% market share)-
Some sections of the society prefer buying medicines from other established pharmacies of the
organized sector. And hence there is a strong competition with other heavy-weight players.

Consumer analysis -
  Consumer was never treated as end-user and hence largely ignored
 No discounts given by Guardian but have kept customer satisfied & loyal
 Value added services, reliability, transparency, good speed of billing was welcomed
 Consumer needs pharmaceutical shops closer to their homes

Issues and solutions–

Sl.N
Issues Solution
o
-Provide option to order online then pick up from store by
verifying prescription physically
Higher billing time as crowd is expected
1 -At store shopping use the waiting time at the billing
to grow with increase in business
counter to capture customer's feedback to evaluate and
enhance their future experience
-Guardian owned warehouses and delivery services to store
thus eliminating middle men.
-Use blockchain technology/analytics in inventory
Complex supply chain, non-availability management to tackle non-availability of drugs
2
of drugs, no discounts offers -Study store sales pattern and pre-place drugs expected to
sell in particular time of the year
-This cost reduction may lead to Guardian offering
discounts which may help in higher sales
Aggressively spread awareness on ill-practices and
3 Consumer unawareness is high irregularities of the local pharmacists and pull customers
towards Guardian
Lobby the government along with other players of
Lax pharma regulations, loosely
4 organized sector for passing stronger regulations, better
enforced
enforcements
The supply chain revamp would help in stopping counterfeit
5 Growing level of counterfeit drugs drugs entering stores as less nodes would exist in the
supply chain
High investment is required for opening
-Above mentioned 5 steps would help in an increase in
brick and mortar stores and for
6 revenue
increasing presence in the urban & rural
-Reach out to venture capitalists
market in India
Rural penetration is difficult for the
7 Offer franchises in rural area for their "Aushadhi" stores
organized sector
Government's entry into the market
could mean subsidized medicines from
8 govt store also puts a question mark on -
the future of Guardian stores inside
govt hospitals
Need to venture out WRT tie ups with pathology labs,
9 -
generic medicine market with in-house brand