Farmasiet is Norway’s first purely online pharmacy, and since its inception nearly ten years ago, it has captured increasingly large portions of the billion-dollar pharmacy products market.
But growth comes at a cost.
Recent accounts for the past year show that sales volume increased from NOK 448 million in 2021 to NOK 526 million in 2022. Losses before tax also increased, from NOK 64 million to NOK 79 million.
Since its inception, total losses are close to NOK 400 million.
– Very proud
Last year began with a new Corona lockdown, which slipped into a reopening before Russia’s war of aggression against Ukraine shocked Europe. The energy market is becoming unbalanced, inflation and interest rates are affecting the markets more and more, and the capital markets are getting tougher.
Pharmacy manager Elisabeth Hogg saw stocks pointing down on the retail side.
The nature of growing companies is that you have to adapt quickly. We were able to quickly adjust costs without detrimental to customer growth. We are very proud of our growth over the past year. It says it’s bigger than the growth in the pharmaceutical industry and bigger than most retailers.
– You are a growing company. It would be strange if it did not grow?
– Hogg says there are a lot of zero-growth and negative-growth growth companies out there.
This fall, she and Farmasiet will open their new warehouse in Vestby, where almost everything from products to customers will be handled through automation. The warehouse area is 8000 square meters. According to Hough, the organization was extremist.
disability according to the plan
“It’s still our ambition to be profitable a few years from now,” says Hough.
The largest investment related to automation initiatives was made last year and will be made this year, according to the CEO, who said they’ll have a very different cost base to grow with.
– Now we can be twice as big without increasing costs, says Hough.
– Will there be more profitability from 2024?
– We can already see that profitability is on the way up, but the black numbers at the bottom will have to wait a few more years. We are targeting 2025.
– Approaching a total deficit of 400 million, is it according to plan?
– We have made significant investments in improving customer experience such as our new technology platform and logistics. A lot of this ends up on the income statement, not the balance sheet. It’s according to plan, says Hough.
Originally, the online pharmacy started in Sandefjord under the name Komplett Apotek and was part of Stein Erik Hagen’s online commerce empire owned by Canica. In 2019, buyout fund Verdane became owner.
In 2022, total Norwegian pharmacy sales will be NOK 46 billion. The growth over the previous year was 4.9 percent. In contrast, Farmasiet grew by 17 percent. Hough is clear that building takes time.
– For a new player like us, it must convey that you can run a pharmacy in a safe and sound manner, while at the same time changing customer habits. She says this takes time.(conditions)Copyright Dagens Næringsliv AS and/or our suppliers. We’d like you to share our statuses using links that lead directly to our pages. Reproduction or other use of all or part of the Content may be made only with written permission or as permitted by law. For more terms see here.
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