How is the return from Bratislava to Prague?
I wanted to go back, I was looking forward to home. During my career, I have traveled through enough countries to make it clear that I want to return to Prague.
What task did the shareholder in the Czech Republic entrust you with?
The task for me is relatively clear: to continue the work already underway. This means in the growth and development of the company. Our interest is to maintain market share and look for new ways to develop. There are a lot of those options. We are in a different situation today than before, when the same business model could work for twenty years. In the last five years, there have been technologies that have completely changed people’s behavior. It is necessary to react to it.
Is digitization – as in other fields – the main driver of change?
Sure, but there’s more to it. For example, the opening of new channels – you can also see this with our competition, where, for example, the Benu network started to cooperate with Rohlík and together they created a path that is promising. We do the same with Košík. With the DoDo company, we offer delivery of parcels from our e-shop in Prague, Brno and Ostrava, for example, on the day of the order, so-called same day delivery, or in other hourly slots. This works, but I would like us to try ways that may not always be successful. It is necessary to look for new opportunities.
Investing in the technological development of pharmacies must therefore be a priority. Technology is a topic. For us, it is, for example, the technological background of pharmacies. Together with the German company BD Rowa, we were the first pharmacy network to introduce Easy Load – a robotic system for storing and dispensing medicines – in the pharmacy in Roudnice nad Labem. We have currently put another one into operation in Brno, and we are planning two more this year. Thanks to this system, direct contact between the client and the pharmacist in the pharmacy is not interrupted. The pharmacist does not have to go to the warehouse for the medicine, he can attend to the patient 24/7, because the robot will find and administer the necessary medicine. There is a saving of time, therefore also financial, and at the same time an improvement in the quality of the service. This changes the operation of the entire pharmacy.
What are your reactions to the robot so far?
It’s great for the patient, he doesn’t notice anything at first glance. Jen has the cure within ten seconds. Honestly, some pharmacists were more concerned about the robot at first. They wondered if this might mean that the machine would take their jobs. Today they are excited about the news. In Slovakia, where we installed the first robot three years ago, it was the same. Pharmacists there are already fully accustomed to it today. I therefore believe that we will successfully repeat it here as well.
Are Slovaks more progressive in their approach to healthcare? A lot of people in the industry tell me they do.
I’m not going to completely agree with you here. Each country has its own local advantages and problems. For example, in Slovakia, people are perhaps more flexible and it is better to solve the problem of the lack of pharmacists there than in the Czech Republic. Regulation and legislation play a big role in pharmacy. In Slovakia, they got much further in the preparations for vaccination in pharmacies, and I believe that when the situation stabilizes after the elections, the process will continue there.
On the contrary, in the Czech Republic we can have a company that covers all pharmacies. In Slovakia, every pharmacy must be an “eseróčko”. Suddenly you are the CEO of the largest number of companies in the country. In this, Slovakia is an administrative juggernaut. We can also operate a modern laboratory in the Czech Republic, nothing similar is possible in Slovakia. It is simply impossible to generalize.
Dr. Max likes to brag that he is implementing the business model he invented in the Czech Republic across Europe. Can you really transfer the same approach easily to, for example, the Italian market?
It is great when Czech projects are successful abroad. For example, I worked for the Dutch and I learned from them how proud they are of Dutch achievements abroad. Dr. Max is the second largest company of its kind on the continent and the Czech business model is really “rolling” into Europe. Whether it is your own brand, a loyalty program, the appearance of pharmacies, or a pro-client approach. Where possible, we try to unify and replicate the processes as we invented them in the Czech Republic. I believe that with this model we will open or buy perhaps another thousand pharmacies in Europe.
Do you have room for further consolidation?
In the Czech Republic, the market is already consolidated, but not so much in Italy, for example, and there is certainly room for further acquisitions. It is also one of the company’s priorities for next year.
What else do you want to focus on next year?
In addition to the mentioned expansion, it is a focus on our private brand, where we are fundamentally expanding the portfolio of prescription drugs as well. In today’s economic situation of customers, when purchasing power has decreased, the price/performance ratio plays a huge role and this factor is essential across all countries where Dr. Max works.
Online sales is a big topic for you. In this, Pilulka is your strong competitor. You are the dominant player in the market. What are your chances for further growth in e-commerce?
We will definitely grow online the most of all channels and strengthen our position as the market leader here. I expect a fifth year-on-year increase in online sales. Czechs are used to and adjusted to the logic of e-commerce. But I don’t believe that for all types of medicine. For example, from my short experience selling prescription drugs online, I know that the situation is different with them. For them, the reservation system plays an important role.
In general, however, we develop online and, for example, we are the only ones on the market to have our dispensing boxes equipped with thermoregulation in order to comply with good distribution practices. As for Pill, it was a successful “launch” of a player with ambition. And that’s good. However, in my opinion, the multi-channel model – that is, online in combination with offline – is healthier in that we can diversify – and thus reduce the risk. The high, more than half share of so-called “click and collect”, i.e. e-shop clients who want to pick up the shipment at the pharmacy, tells us the truth. We believe in the omnichannel concept (sales and communication with customers using all available channels – editor’s note).
Is there such a thing as brand trust in pharmaceuticals? You know you go to Dr. Max, or are you just a medicine supermarket?
We have a marketing survey, according to which the brand recognition of Dr. Max over 90 percent. This is an amazing number even in connection with the fact that we are dealing with human health. Having a strong and trusted brand is imperative when it comes to being the institution people turn to for professional advice.
It used to be said that “cash is king”, today logistics is king. Whoever controls the last mile wins. How challenging is it for you to build infrastructure?
We have a well-established foundation, and the next two years will see another wave of investment in logistics. We plan to move the e-shop to a larger warehouse in Brno, which we will open on the site of the former Zetor. Distribution for traditional pharmacies will be strengthened by the new base in Ostrava. We also launched an experimental local distribution center there, which combines both a traditional pharmacy and an e-shop.
The pharmacy itself has an area of over two hundred meters, and a warehouse of eleven hundred. In both directions, these are multiples of what is usual. It will make it possible to have a much wider assortment directly in stock and to combine online and offline even more. Here, clients will encounter something that is not at all common in the industry – for example, they can make an immediate e-shop order via a digital sales kiosk. Or pay at the self-service checkout. It is such a pharmacy of the future.
What about the pharmacist of the future? Today, people are missing in all segments. How difficult is it to find a quality person in pharmacy on the market?
Members of the younger generation of graduates no longer want to be mere drug salesmen. I believe that even the offer of technologies should motivate them to come to us. It’s a challenge for us in general. The number of young people who are willing to study a relatively difficult field is not growing. We are therefore trying to create campaigns that would encourage interest in studying pharmacy.
The lack of personnel is also exacerbated by the feminization of the field. The number of women who go on maternity leave is huge. The situation is better where specialized faculties operate, i.e. in Hradec Králové or Brno. There is an interest in continuing to work at the place of study. But convincing people to move to the north or west of Bohemia is quite challenging.
Do you go to colleges and offer programs for students?
We have various programs, we participate in job fairs, we provide scholarships. We are well-known at professional schools. We try to work with ambassadors, we organize open professional conferences ourselves. And we have the advantage of a large central laboratory in Prague, which is unique in Czech conditions and increases our attractiveness even more. It’s a pharmacy storefront. It is also an interesting experience for future pharmacists. If they want to devote themselves more to the preparation of medicines, they have an excellent chance there.
Your big ambition is to start a marketplace. Can you describe the principle of what it might look like?
The marketplace form is much more widespread abroad than it is here. We can speculate whether and to what extent we are a different market, but from what we can see so far, Czech marketplaces are working. If you look at standard retail, the Czechs are good at marketplaces. And if we are looking for ways where and how to grow, we have to offer an expanded offer, an even richer assortment. We are looking for partners for this. We are talking about additional sales that correspond to our focus and clientele.
So, for example, electronics related to health or products related to beauty will appear on our marketplace, because the most common client is a woman. But we will not sell tires. The goal is not to have millions of items, but to focus on our target group.
When will it be launched?
We are currently working intensively on preparations. We would like to launch our marketplace next summer.
Jan Žák
The general director of the pharmacy network, Dr. Max in the Czech Republic and its sister distribution company ViaPharma is from March 1, 2023.
With this position, he continues his four-year tenure at the head of the network of Dr. Max in Slovakia, where he participated, for example, in the acquisition of 47 pharmacies of the Apotheke Slovakia network or in the construction of a logistics base near Sence.
Before working at Dr. Max held senior management positions at international companies such as Metro or Ahold.
