Author: nimfa.martinez@ipagroup.com

When most pharmacy owners think about financial performance, their attention naturally gravitates toward the profit and loss statement. After all, it tells you how your business performed over the past 12 months. But as a finance professional, my first stop is always the balance sheet – and here’s why. 

Why your balance sheet matters 

The profit and loss statement is a snapshot of a single year. The balance sheet, on the other hand, represents the financial story of your pharmacy over its entire life. It’s not just a static report; it’s a powerful tool that can reveal opportunities to unlock cash and strengthen your financial position. 

Common sources of funds include: 

• Cash on hand 

• Debtor collections 

• Reducing inventory 

• Limiting prepayments 

• Financing assets rather than purchasing outright 

The balance sheet also shows where funds are leaving the business. For example, you might be paying wholesaler accounts, suppliers, taxes, employee entitlements, and loan repayments. But there’s one area that’s often overlooked – drawings and related party loans. 

The Silent Cash Drain 

Negative retained earnings indicate a loss, but drawings, dividends, and related party loans tell a different story. Instead, these represent cash generated by the business that has flowed outside the business. For non-financially trained owners, this is easy to miss but it’s the first thing I look for. Why? Because it answers two critical questions: 

1. Is the business truly in good health? 

2. Is the owner living beyond their means—or worse, in a partnership, has one owner unknowingly lent money to another? Partners, Shareholders, Trustees, need to have the difficult conversation with each other and with your accountant. 

Ignoring these signals can lead to serious cashflow challenges, even when the profit and loss looks healthy. 

Practical Steps to Improve Cashflow 

If you have surplus cash, make it work for you: 

• Use an offset account against your pharmacy loan to reduce interest expense. 

• Review your debt terms regularly – a 1% interest saving is like a 1% improvement in trading terms. 

• Manage inventory efficiently: aim for stock turns greater than 6x for OTC lines and 14–16x for dispensary lines. 

• Avoid bulky stock purchases based on promised discounts – they often tie up cash unnecessarily. 

• Be prudent with high-cost drugs and avoid overstocking. 

• Collect customer debts promptly, especially aged care patient accounts. 

• Log Medicare claims correctly the first time to avoid delays. 

• Don’t let strong pharmacies subsidize weaker ones – this only delays tough decisions and drains cashflow. 

Your balance sheet isn’t just an accounting requirement – it’s a roadmap to financial resilience for your pharmacy. By understanding where cash is locked up and where it’s leaking out, you can make smarter decisions that protect your business and your future. 

Q&A with Paul O’Sullivan, CFO, IPA

How would you best summarise your role in the IPA business?
My role is to ensure everything we do for members adds equity to their business.

How long have you been with the business?
I have been with IPA for 3 years.

How long have you been in the pharmaceutical profession?
14 years.

Can you give me a brief breakdown of how you found your way into your current role? What did your journey look like?
My journey started at a wholesaler during the middle of PBS reform. Many pharmacy groups were struggling to cope, which created financial stress across the industry. That experience gave me a deep understanding of pharmacy financial statements, performance, and KPIs. I was able to help pharmacists make strategic changes to their business, respond proactively to challenges, and ensure they could compete and grow in their local markets.

What made you want to begin working in the pharmaceutical industry?
I had been working in retail in the book and publishing industry when an opportunity came up to take a commercial role at a wholesaler. The experience was transformative, it exposed me to the breadth and complexity of situations in pharmacy and challenged me to find practical solutions to real-world problems.

What are you passionate about within the industry?
I’m passionate about the tremendous positive impact the pharmacy industry has on the Australian community. This is never more evident than during bushfires, floods, and particularly through COVID. The pharmacy network across Australia is incredibly extensive, arguably one of the best-connected industry networks in the country.

What major shifts have you experienced in the pharma industry over the past 5–10 years?
The industry is constantly subject to regulatory risk. Decisions like PBS reform, 60-day dispensing, and the shift toward full scope of practice and prescribing create both challenges and opportunities for pharmacists. These changes directly impact their most important income source, their pharmacy. It’s essential for pharmacists to manage these changes carefully so their financial success translates into sustainable support for their local communities.

What emerging trends or technologies are you excited about right now?
Automation, self-diagnosis, and full scope of practice and prescribing are tremendous opportunities for the industry. They can shift healthcare delivery away from reliance on government, expand the services pharmacies can offer, reduce fiscal pressures, and still provide accessible, high-quality health advice and care to all Australians.

How do you stay ahead of the curve in such a fast-evolving space?
I spend time on the road, visiting stores and meeting pharmacists. The more pharmacists I meet and the more stores I visit, the more I learn about what’s happening at the frontline.

What advice would you give to someone aspiring to lead in this field?
Get out there and meet customers, walk a thousand miles in their shoes. Understand what the Australian health consumer is demanding, because the best solutions flow directly from that insight.

What project have you worked on during your time at IPA that has most inspired you?
Culture is strategy in action. Driving a singular culture across three mergers to form the IPA identity has been incredibly inspiring. It allows the business to create scale, which we can then leverage to benefit our members. By doing this, individual pharmacies can compete more effectively with corporate groups while still running their small businesses and retaining their unique identity.

What’s a book, podcast, or mentor that has influenced your thinking?
Blue Ocean Strategy

What is your vision for IPA?
To be the first and only choice as a member-based organisation for independent pharmacies in Australia.

Lessons from 2025 

One of the biggest takeaways from 2025 is the importance of cost control. Reviewing your pharmacy’s expenses (which include things like insurance, wages, accounting fees, and any leases due to expire) should be a priority for all business owners. I like to think of it as a summer “spring clean” for your finances. Negotiating early can save thousands and give you ample breathing room for the year ahead. 
 
Another critical lesson businesses need to learn from 2025 is that we cannot rely on a single income stream. I observed plenty of pharmacies that diversified their offerings – whether through retail, vaccinations, or full scope of practice and ultimately, they were better equipped to weather ongoing market fluctuations. This is because when all your eggs are in one basket, you’re vulnerable. In 2026, if you want to take your pharmacy to the next level, it is critical that you do things like build relationships with GPs, allied health professionals, and aged care providers also proved invaluable, keeping pharmacies front of mind in local health networks. 
 
Finally, many pharmacies missed opportunities when interest rates dropped. Instead of reinvesting surplus cash into the business or getting ahead on loan repayments, some may have just let the excess cash sit in the bank. The smarter move? Use your improved serviceability to renegotiate with your bank from a position of strength, reinvest in new income streams, and reward high-performing staff to boost loyalty and retention. 

Balancing Cost Control with Growth Ambitions 

The market is always changing, and pharmacies that fail to evolve risk falling behind. The key is to make educated, calculated investments in areas you understand – pharmacy services that deliver measurable returns. 
 
For example, investing in full scope of practice can position your business ahead of the curve. It’s not just about adding services to your offering; it’s about creating resilience and relevance in a highly competitive market. 

Top Priorities for January 2026 

The start of the year can be challenging because holiday sales are over, many customers are away and pharmacies may be experiencing excess stock. In my experience, there are three key practical steps to keep your business financially fit, which include: 

• Clear excess stock by offering discounts – freeing up cash flow early sets the tone for the year. 

• Manage leave liability – encourage staff to take annual leave. It’s a well-deserved break for many and reduces financial obligations for the pharmacy. 

• Maximise seasonal opportunities – if you’re in a holiday destination, extended hours and full stock can drive revenue, and cross-selling to increase basket size is a smart play.  

Preparing for Uncertainty 

Regulatory changes and market volatility aren’t going away. Update your business plan with conservative cash flow predictions and maintain a strong relationship with your bank. Know your bank as well as they know you, because when challenges arise, this relationship matters. 

Final Thoughts 

Cost of living pressures will continue to shape consumer behaviour in 2026, but one thing remains constant: people value service. Many Australians prefer their local pharmacy for advice over major chains, and that trust is your pharmacy’s greatest asset. 
 
So, what’s the single most important piece of advice for the year ahead? Do something. Whether it’s renegotiating costs, diversifying income streams, or investing in your team, action beats inertia every time. 

Here at IPA, we’re celebrating the pharmacists across Australia who make a difference every single day. They do so much more than dispense prescriptions. They’re often the first to listen — and the first to act. Providing health advice and education with every conversation.

They vaccinate. They screen. They counsel. Helping patients manage chronic conditions and stay well.

They provide care to older Australians and those who find it difficult to visit a pharmacy.

They do more than run a pharmacy. They create jobs. They mentor future pharmacists. They champion local health and support community causes.

They’re trusted faces in local communities.

We thank our pharmacists for creating healthier communities every day.

From Monday 21 July, Independent Pharmacies Australia (IPA) will host its premier learning event of the year – the 2025 IPA Pharmacist Academy; a three-day program dedicated to clinical excellence, leadership and innovation.

This inaugural event will bring together pharmacists from across the IPA network who are passionate about improving their knowledge and skills to provide healthcare excellence in their community.  The Pharmacist Academy will focus on four key areas of essential and practical professional development, including:

• Learn: Expand clinical and business expertise to integrate the latest advancements
• Engage: Strengthen leadership and team performance with expert-led strategies
• Advance: Explore new revenue opportunities and innovative patient care models
• Deliver: Improve patient outcomes through engagement, technology and digital solutions

Attendees will have the opportunity to enhance their clinical and business acumen, strengthen leadership capabilities, explore new income opportunities and improve patient care through engagement, innovation and technology.

Headlining the event are keynote speakers Kos Sclavos (Chief Pharmacist – DBG Health) and Hayley Tamborini (Chief Commercial Officer Arrotex) who will share their insights on the Australian pharmacy and healthcare landscape and how the pharmacists role will evolve to support Australian patients.

IPA Managing Director, Steven Kastrinakis, says the IPA Pharmacist Academy is a valuable opportunity to bring together our pharmacists to focus on advancing their professional skils for the communities they serve.

“At IPA, we are committed to unifying independent pharmacy and advancing practice to enhance both patient care and business success. Through education, innovation, and industry collaboration, we empower pharmacists with the clinical, business, and leadership skills needed to thrive,” Steven Kastrinakis says.

A topline event Itinerary of the three-day event includes:

• Accommodation at the luxurious 5-star Manly Pacific Hotel for the duration of the stay
• Monday 21 July – a welcome dinner at the elegant Cantonese restaurant, Queen Chow Manly
• Tuesday 22 July – closing night cocktail party at Little Pearl Manly set against the waterfront.

To register for the 2025 IPA Pharmacist Academy and view the event program, visit the link here.

Independent Pharmacies Australia (IPA) has officially launched its first branded pharmacy, Broadbeach Day & Night Chemist, during APP2025, marking a major milestone in the evolution of independent community pharmacies.

Timed to coincide with the Australian Pharmacy Professional Conference & Trade Exhibition (APP), this unveiling showcases IPA’s commitment to strengthening independent pharmacies while providing them with national marketing power, operational efficiencies, and sustainable growth opportunities.

The new IPA-branded pharmacy model empowers members to maintain their independence while benefiting from a nationwide consumer-facing brand. This includes a comprehensive store refresh, innovative technology integration, tailored category management, and extensive marketing support—from grand openings to digital campaigns.

IPA Managing Director Steven Kastrinakis said, “we are extremely proud to reveal our first-ever IPA branded pharmacy in partnership with Julia Clare, owner of Broadbeach Day & Night Chemist. This pharmacy demonstrates our commitment to delivering innovative, future-ready solutions for the 1,100 pharmacies in our network. Pharmacies like Broadbeach Day & Night Chemist will retain full autonomy while gaining the advantage of a powerful national brand presence and the strategic backing of IPA. This initiative modernises community pharmacy while providing financial benefits, access to community pharmacy focused technology such as Buy It Right and Patient360 as well as digital screens, and health programs via EasyClinic. Our members will also gain access to product ranges and services from DBG Health – Arrotex, VidaCorp and Axe Diagnostics.”

A New Era for Independent Pharmacies
IPA’s branding model supports member pharmacies through:
• A refreshed, flexible store design tailored to each community’s unique needs
• Enhanced product & pricing strategies through planogram customisation and supplier partnerships
• Innovative technology integration for seamless customer experiences with inventory automation with Buy It Right and better patient relationship management with Patient360
• Comprehensive marketing & branding support from store opening to local area marketing and national marketing
• Clinical services opportunities through patient-centric health programs – point-of-care testing and EasyClinic

The unveiling of Broadbeach Day & Night Chemist also underscores IPA’s strong focus on primary care services, including point-of-care testing, reinforcing its dedication to accessible and efficient patient care.

This launch lays the foundation for a nationwide IPA brand campaign, uniting independent pharmacies under a trusted, recognisable identity while preserving their individual strengths.

The Independent Pharmacies Australia (IPA) proudly announces a successful Member Summit conference that brought together the IPA community for an unforgettable experience of networking, insightful discussions, and community-building. This year’s conference was a standout event, marked by a remarkable $44,000 donation to the Fullife Foundation, an ongoing partner of IPA in advancing essential humanitarian projects.

Founded by independent pharmacy owner Ian Shanks, the Fullife Foundation has, with IPA’s support as its largest donor, made transformative contributions across Africa. “The Fullife Foundation was started by one of our members to address urgent healthcare needs in underserved areas,” said Steven, Founder, Pharmacist and Director of IPA. “Through Ian’s vision and our members’ ongoing generosity, the Foundation is truly making a tangible impact on the ground in Africa.”

Over the years, the Fullife Foundation has brought clean water to over 12,000 people and launched life-changing initiatives focused on empowering women with disabilities in southern Africa to start businesses. Addressing fundamental needs such as water, food, shelter, education, and healthcare, these programs are poised to benefit an estimated 50,000 people over the next decade.

One of the Foundation’s latest projects is an immunisation campaign targeting communities with low vaccination rates. Supported by quarterly visits from Australian nurses, the initiative supplies vaccines for diseases like whooping cough and measles, protecting around 1,000 people each trip. Additionally, funds from IPA are being allocated to provide locally made birthing kits, which have reduced maternal mortality rates by up to 80%.

Ian Shanks expressed his appreciation for the unwavering support from IPA and its members. “We are incredibly thankful for IPA’s generosity and commitment. With 100% of funds going directly to our programs, this partnership maximises the impact of every dollar. Our longstanding relationship with IPA has fostered not only financial support but also a strong sense of shared purpose amongst the cohort of members pharmacies who share the same goal of supporting communities.”

The Member Summit was further supported by numerous partners, who generously donated auction prizes to enhance the success of the fundraising. Special thanks go to Allfin Financial for their support as the event’s charity partner, reinforcing the power of collaboration in driving meaningful change.

Independent Pharmacies Australia (IPA) is pleased to announce the appointment of a new General Manager of Merchandise, Darragh O’Se, effective Monday, 2 September 2024. 

Darragh joins the IPA team bringing a wealth of experience in merchandise management, having held senior roles at Woolworths Group and Blooms the Chemist, with significant expertise from Smyth’s Toys Superstores in the UK, Central Europe, and Amazon Australia. Darragh has a strong track record of using insights to develop impactful category strategies and has consistently delivered exceptional results. Additionally, as an active Chartered Institute of Procurement & Supply member, Darragh exemplifies his commitment to professional excellence and industry knowledge.

“I am thrilled to be joining IPA during the exciting growth phase,” said Darragh. “I am dedicated to delivering exceptional value to IPA members and growing supplier brands to create a positive impact in Australian communities. I’m also very excited to work with the IPA team to achieve our collective goals.”  Darragh will lead a team of 32 category, procurement and logistics specialists in a newly structured IPA Merchandise team. 

Lynne Gallucci, who joined IPA as Chief Operating Officer in March 2024 said “The Merchandise restructure responds to member and supplier partner feedback to focus on areas that have been jointly identified for a successful business partnership.  Our focus is to unify independent pharmacies to deliver scale, simplify the way we do business and our pharmacies’ operations, and amplify the great products, services and programs that our pharmacies provide to their communities.”

In addition to this pivotal appointment, IPA is confirming several team changes within the Merchandise team to enhance operational efficiency and support its strategic initiatives:

• Natasha Beck – Head of Buying
• Suzi Ebeyer – Head of Merchandise Services
• Matt Marsh – Head of Merchandise Operations

Steven Kastrinakis, IPA Managing Director, said, “I am excited to welcome to Darragh to the team and am confident that with his leadership of the Merchandise team, IPA will bring continued success and growth for our 1100 members across Australia and our valued supplier partners.” The IPA Merchandise team changes will strengthen support for IPA members by providing strategic category plans including ranging, pricing, and promotions, in a fast-evolving pharmacy industry.