How to Start a Pharmacy Business in India?

There are different types of medical stores that a person can start, based on location and purpose. These include:

1. Hospital Medical Store: This type of medical store is set up inside a hospital to provide medicines directly to the patients who visit or are admitted there.
2. Standalone Medical Store: This is the most common type of medical shop. It is usually a small or medium-sized store located in residential areas where people can buy daily-use medicines.
3. Chain Pharmacy or Franchise Outlet: These are part of a large group or brand of medical stores. They are often found in malls or shopping complexes and have multiple branches in different cities or areas. These stores are generally bigger in size.
4. Township Medical Store: These stores are opened in towns, villages, or residential townships to meet the healthcare needs of the local population.
5. Stores in Government Premises: These pharmacies are opened under government schemes and work under government rules. They are usually located inside government buildings or offices.

Starting a pharmacy in India can be a great business opportunity due to the constant demand for medicines. However, you must follow several legal steps to run it properly.

Step 1: Decide the Type of Pharmacy

You need to choose what kind of pharmacy you want to start. It can be a retail pharmacy (selling medicines directly to customers), a wholesale pharmacy (selling in bulk to other pharmacies), an online pharmacy (delivering medicines through websites or apps), or a hospital pharmacy (set up within hospitals). This decision will affect your license and setup needs.

Step 2: Meet Basic Requirements

To open a pharmacy, at least one person must be a qualified pharmacist with a degree or diploma in pharmacy. The shop space should be at least 10 square meters for retail or wholesale and 15 square meters if you're doing both. You must also have a fridge and proper storage for medicines that need a certain temperature.

Step 3: Digital Tools & Software

Invest in pharmacy management software for billing, inventory tracking, expiry alerts, and digital prescriptions. Tools like Marg ERP, Redbook, or GoFrugal can help automate operations and reduce manual errors.

Step 4: Apply for Drug License

A drug license is required under the Drugs and Cosmetics Act, 1940. For retail pharmacies, you need a license in Form 20 and 21, and for wholesale, Form 20B and 21B. Apply through your State Drug Control Department. You’ll need documents like pharmacist qualification proof, premises proof (rental or ownership), ID proof, and declaration forms.

Step 5: Get GST Registration

If your annual turnover is more than Rs. 40 lakhs, you must register for GST. GST registration allows you to charge tax on the medicines you sell and file returns on time. Even if your turnover is below the limit, getting GST can help in working with suppliers and maintaining legal compliance.

Step 6: Open a Current Bank Account

To keep your business finances organized, open a current bank account in your pharmacy’s name. This account will help you receive payments and pay vendors or suppliers easily.

Step 7: Set Up Your Shop

Your pharmacy should be clean, well-organized, and meet all storage standards. Install air conditioning and a fridge for storing certain medicines. Use proper shelves, billing software, and inventory systems to keep track of stock. Hiring trained staff will also help in managing operations better.

Step 8: Create an Online Presence (Optional)

If you want to sell medicines online, you can create a website or join platforms like 1mg, Netmeds, or PharmEasy. You’ll also need an FSSAI license if you plan to sell health or dietary supplements. Online selling helps reach more customers and increase your sales.

Tip: Always follow legal compliance, renew your drug license on time, maintain sales records, and avoid selling expired or restricted medicines to avoid penalties during inspections.

Starting a medical store in India requires following specific rules to ensure public health and safety. From the size of your shop to proper storage and qualified staff, here are the key requirements you must meet:

1. Area Specification

To open a medical store, you need to have a minimum area of 10 square metres for a retail pharmacy and 15 square metres for a wholesale pharmacy. This space should be clean and suitable for storing medicines properly.

2. Storage Facility

All medical stores must have a refrigerator or air conditioner. This is important because some medicines like insulin, vaccines, and other temperature-sensitive drugs must be kept cool as per the storage rules mentioned on their labels.

3. Technical Staff

Qualified staff must be present in the medical store to sell medicines:

• For Wholesale Stores: Medicines should only be sold under the supervision of a registered pharmacist with at least one year of experience, or a person with four years of experience, as approved by the Drug Control Department.
• For Retail Stores: A registered pharmacist must be present during working hours to handle the sale of medicines.

Other Registrations Required for Medical Stores

Besides registering your medical store as a proprietorship, partnership, LLP, or company, there are several other important registrations and licences you must get to legally run the business.

1. Pharmacy Licence

This is one of the most important licences needed to run a medical store. Either the store owner or the person appointed as a pharmacist must be a qualified pharmacist with a B. Pharm or M. Pharm degree. Only then can they apply for and receive a valid pharmacy licence to operate the store.

2. Shop and Establishment Registration

All medical stores must register under the Shop and Establishment Act of their respective state. This is required by the local municipal corporation and is necessary to operate any commercial shop or establishment legally. The rules may differ slightly from state to state, but registration is compulsory.

In today’s digital world, giving customers different ways to pay is very important. It not only improves their experience but also helps you grow your business.

Why Payment Infrastructure is Important

Most customers now prefer using digital payments instead of cash. They find it faster, easier, and safer—especially for contactless payments. By offering different payment options, you can serve more customers, make their shopping experience better, and keep up with the latest trends in digital payments.

Types of Payment Solutions for a Pharmacy

• Point-of-Sale (POS) Machines: These machines allow customers to pay using debit cards, credit cards, or UPI. They are simple to use and very common in pharmacies.
• Payment Gateway for Online Orders: If you plan to sell medicines online or offer home delivery, you can use a payment gateway like Razorpay. It helps you collect money online safely and quickly.
• Payment Links for Home Delivery or WhatsApp Orders: With services like Razorpay, you can create payment links and send them to customers via SMS, WhatsApp, or email. The customer just clicks the link and pays easily.
• UPI & QR Code Payments: These are perfect for quick, contactless payments. Just print and display your UPI QR code at the counter, and customers can scan and pay instantly using their phones.

Yes, opening a pharmacy can be a very profitable business in India.

1. People Always Need Medicines: Medicines are something people need all the time when they are sick or even for regular health check-ups. So, there is always demand for a medical store.
2. Business Runs All Year: Pharmacies do not depend on festivals or seasons. People get sick in every season, so your shop can earn money throughout the year, without big ups and downs.
3. Good Profit on Products: You can earn money in many ways:

• • Profit on medicines (especially generic ones which give higher margins).
  • Selling healthcare items like vitamins, protein powders, and baby products.
  • Online orders and home deliveries also help increase your income.

4. Many Ways to Start: You can open a small retail shop, work as a wholesaler, or even run an online pharmacy. You can also take a franchise of a big medical brand. All of these can give good profits if managed well.
5. Growing Healthcare Market: More people are becoming health conscious. There are also more hospitals, clinics, and government health schemes. So, the need for pharmacies is growing every year.

Starting a pharmacy usually needs an investment of around Rs. 5 lakh to Rs. 15 lakh, depending on where you open it, how big the shop is, and how much stock you keep.

1. License & Registration Fees

This includes the money you’ll spend to register your business, get a drug licence, and do GST registration. You should keep around Rs. 50,000 to Rs. 1 lakh for all these legal steps.

2. Rent & Store Setup

You’ll need to pay rent for the shop, and also spend on shelves, fridge, billing counter, lights, and security systems. This cost depends on your area and shop size. It may be around Rs. 2 lakh to Rs. 5 lakh.

3. Initial Medicine Stock

To start selling, you must fill your store with important medicines, first-aid items, and healthcare products. For this, you’ll need to spend about Rs. 2 lakh to Rs. 5 lakh for the first stock.

4. Pharmacist Salary & Staff Cost

If you’re hiring a registered pharmacist and other workers, you need to pay their monthly salaries. A pharmacist may charge between Rs. 20,000 to Rs. 50,000 per month, based on their experience and your city.

Starting a pharmacy can be a great business, but it also comes with a few challenges. From legal paperwork to finding the right staff, you may face some difficulties in the beginning.

1. Getting the Right Licenses and Approvals: It can be confusing and time-consuming to get all the legal approvals like drug license, GST registration, and shop registration.
2. Finding a Qualified Pharmacist: Hiring a registered pharmacist is necessary, but in some areas, it’s difficult to find someone qualified and available full-time.
3. High Initial Investment: Setting up a pharmacy requires a good amount of money for rent, licenses, furniture, and stocking medicines.
4. Understanding Medical Rules and Compliance: There are many rules under the Drugs and Cosmetics Act, and not following them can lead to fines or cancellation of license.
5. Competition from Other Medical Stores and Online Pharmacies: Many pharmacies already exist, and big online platforms offer discounts, making it hard for new stores to attract customers.

Solutions:

1. You can hire a business consultant or use services like RegisterKaro to help with licenses and paperwork.
2. Offer competitive pay to attract pharmacists or make them a partner to ensure long-term support.
3. Begin with a basic setup and essential medicines, then grow as you earn profits. You can also look for government schemes or small business loans.
4. 4. There are many simple online courses or YouTube videos that explain pharmacy laws. Staying updated helps you avoid legal trouble.
5. Offer good customer service, home delivery, and essential stock to win local customers. You can also promote your shop through WhatsApp, flyers, and social media.