Valley Drug Mart
Valley Drug Mart
George Fairn is the successful sole proprietor of Valley Drug Mart built in his hometown of Middleton, Nova Scotia over a 16 year period. Fairn accomplished this by purchasing Eatons (1200 square feet), a retail drug store he worked at; and in a few years purchasing the only other drug store in Middleton, Mumfords.
Prior to the purchase of the second retail drug store in Middleton, Fairns management strategy focused on his ability to manage and run the business. He had only four store front employees and he was the sole pharmacist. At this time, his marketing strategy focused on the prescription service as it provided 95% of his profits; however he knew that by not providing store front services, he would be inviting competition to satisfy these public demands. He acknowledged this, and purchased a larger building to accommodate this expansion (7000 square feet). This building was in a prime retail location on Commercial Street and had a parking lot in the back of the building. It was within walking distance of the post office and the bank (which are key locations in a small town), as well as being next to the main commercial sites in Middleton.
After the Fairn purchased the second retail drug store in Middleton, Mumfords; his management style changed to include assistance at a management level and help in the store. He was continued to work long hours; however, the former owner of Mumfords worked with him for five years and then continued to serve on the board of Valley Drug Mart. With the continued growth of Fairns business, he increased his front store staff and added a front store manager and three additional full-time pharmacists.
Fairns marketing strategy changed to include a full range of front store services as he felt the public expected it. He knew the only way to do this would be through an affiliation with a buying group for pharmaceutical goods. He investigated this and originally went with the Associated Retail Pharmacies (ARP) buying group and recently switched to Guardian Drugs as the merchandising arm of his store due mostly to cost.
Throughout Fairns career in Middleton, he was conscious that in a small town the public expected that he would be active in civic affairs and a community leader. He did this very effectively and often exceed the publics expectations. He served on Town Council, was involved in Church activities and was active in the Rotary Club. He also provided services for the community at Valley Drug Mart by offering blood pressure clinics. Valley Drug Mart has also provided the local hospital with needed key equipment as he felt it was his responsibility to contribute to the community which provided his living.
Fairn had many strengths; however, he also had some weaknesses. He was great at marketing himself as Valley Drug Mart. He was a hometown boy that provided a needed service to the community and he was also very active in that community. He was able to identify business opportunities when they arose and he knew to take advantage of them. Fairn was an educated man and did his “homework” before jumping into things (e.g. when he purchased the building to increase his space, he obviously weighed his options and found it in his best interests to wait for leases to run out and then utilize the extra space for Valley Drug Mart). He also recognized that in order to provide himself with a competitive advantage he would have to affiliate Valley Drug Mart with a stronger merchandising arm. The main weakness I would identify for Fairn, was that he was Valley Drug Mart. He speaks about retiring in five years, however, he has never addressed succession and in “small town” Middleton, he is Valley Drug Mart. I have to ask myself, “who would run Valley Drug Mart in the event of serious illness or death?”. Also, Fairn has not looked outside of Middleton. A lot of his success is based on the acquisitions he made in Middleton; however, there may be possibilities in Kingston and Lawrencetown, the two slightly smaller towns located 12 kilometers on either side of Middleton who each has pharmacies. This type of acquisition or even a partnership of some sort would increase his market share.
Overall, Fairn has adapted his strategy well to the evolving competitive environment. He always appears to recognize when to make a change and what to keep the same. I believe his business philosophy, “The customers are the ones doing us a favour by coming into the store. Its not the other way around.” is what will keep Valley Drug Mart in business if Lawtons opens a location down the road in the New Year.
In order to compete with Lawtons, Valley Drug Mart needs to extend its market share and continue with its current strategy of exceeding the communities (customers) expectations. In order to do this, I believe