How To Get Profit Margin In Pharma Franchise

How to Get Profit Margin in Pharma Franchise – The pharmaceuticals business is a good way for startup. If you are someone who is looking forwards to medicines business as a PCD or a pharma franchise businessman then knowing how to get profit margin in pharma franchise is important. Profit is the main driving force of every business. No one likes to work if there are no profit gains.

The Indian pharmaceuticals business is growing profusely. The government of India and their respective states have helped carve the sector in many ways. Byways of offering scheme, policies and benefits, the pharma sector is the best industry to invest. A genuine medicines business harbours a good business opportunity with more than 50+ speciality ranges like diabetic, cardiology, ophthalmic, pediatric, derma, neurology, psychiatric etc. The people are willing to invest in quality medicines and drug formulations.

Pharma franchise is a very profitable business if done with the right company. Pharma companies offer their own benefits and offerings. You need to have a Pharma Company that offers good profit margin. In order to know the profit capabilities, you need to know how to get profit margin in pharma franchise.

And, if you have a plan to start pharma franchise business and looking for best pharma company for PCD franchise then find the list of Top pharma franchise companies.

Factors To Be Taken Into Consideration Before Calculating Profit Margin

Profit in a business is affected by a string of factors. When you start a pharma franchise business, the healthcare segments are affected by many key factors. They decide the returns that you will get on your investments. Profit margin also differs from company to company and the market conditions. Here take a look at some of the factor affecting your profit margin and business.

  1. A PCD pharma franchise company or a simple marketing company offers quite attractive offers and benefits. There are several companies offering the same range of different brand names. You have to choose the best out of them.
  2. Check for demand. Whether it is a particular company brand, medicines segment or any other factor. The consumer is the king. To meet the demand you need to have those medicines segments with you.
  3. Goods and Sales Tax aka GST should be known. You need to keep an eye on them to know the best about your profit margins.
  4. Knowledge about relative costs solves half of the problems. Relative cost is the price of the same commodity or service when compared to another. You need to know more about your accessibilities and demographics etc to know the best, affordable, cheap yet quality sources. This helps you save more profits.
  5. Ask for quotation prices from different companies of the same generic drug. Test them and compare them. Chose the best quality drug for you. Medicines are a delicate business as it involves the life of a person. So choose wisely before settling for a pharma franchise business deal with the company.

Steps To Get The Correct Profit Margin For Your PCD/ Pharma Franchise Business

Here take a look at the steps on how to get profit margin in pharma franchise business:

  • First, calculate the total cost incurred by you. The investments made, transportation costs etc. Here is the formula for Total Cost:

TC or Total Cost = Manufacturing expenses + Administration expenses + Selling Expenses + Taxes + Other Cost (Total Fixed Cost + Total Variable Cost)

  • Second, you need to take out the net rate. The percentage can differ from company to company due to the difference in company policies. Here is the formula to calculate net rate:

Net Rate or Selling price/ Final Price or Net Rate = Total Cost X Percentage (%) of Margin

  • Then you have to calculate profit margin (also names as net profit ratio/ net profit margin). Here take a look at a formula to calculate it:

Profit Margin = Net Profit / Revenue Or Selling Price

*(Net Profit = Revenue – Cost)

Take out the realization amount by making the following deductions and additions. This will help you get the exact amount. Things you have to deduct are Profit Margin, Stockiest share or commission, Doctors Share under Price to Retailer (PTR). Items to add are expenses realized by you and company offer like 10+ 1 or 10+ 2.


The amount differs with the company to company. You should have the complete information to get to the right conclusion. Eridanus Healthcare is amongst the top pharma franchise company which offers a quality wide range of drug formulation. We offer genuine profit margin to our associates. To know more you can contact us.

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