Dundee pharmacy to become 51st branch of Davidsons Chemists

Davidsons Chemists will today complete the acquisition of a Dundee pharmacy as it eyes £60 million sales across the group.

St Mary’s Pharmacy in St Giles Terrace will be Davidson Chemists’ 51st branch.

For now it will continue to trade under its existing name, but is likely to be rebranded as Davidsons in January.

Managing director Allan Gordon describes the shop as a good “geographical and strategic fit” for the Blairgowrie company.

He said there could also be more acquisitions to come.

He said: “My aspirations for the short-term are to continue to grow the group. We are always looking to expand our chain.

“We’re in discussions with a number of small groups across Scotland.

“There are now only a very small number of independent pharmacies in Tayside.”

He said community pharmacy remains “the bedrock of healthcare” and said the long-term future of pharmacies is “extremely bright”.

Challenges of rising costs and staffing

However, the group – which added 50 staff with a multi-million-pound acquisition at the end of 2021 – has faced challenges.

Those include energy bills, increased fuel prices for delivering to customers and staffing shortages.

Mr Gordon said: “We’ve just signed up to a new energy bill. Our rates were exceptionally low before but they are now exceptionally high.

“If the government hadn’t proceeded with assistance, our energy costs would have gone from £200,000 a year to round about £1 million.”

He said those increases in costs would have a huge impact on small businesses.

Mr Gordon said there is currently a shortage of pharmacists, but added it is not a Brexit-related issue.

“There wasn’t a large number of EU pharmacists, so it’s not to do with that,” he said.

“There’s a degree of people retiring, others who’ve taken early retirement.

“The largest thing is probably that secondary care – the likes of GP surgeries – have been active in recruiting pharmacists.

“It goes in peaks and troughs but that has taken its toll.”

Davidsons Chemists branch sales pass £50m

Mr Gordon was speaking as newly-filed accounts show the firm’s turnover surpassed £50m for the year to January 2022.

Sales rose from £46.8m in 2021 to £52.8m for the reporting period, while pre-tax profits dropped slightly, from £5.5m to £4.9m.

Davidsons Chemists‘ employee numbers also rose to 471 across the group, up from 440.

The jump in turnover was primarily down to a series of acquisitions, Mr Gordon said.

“We saw some general growth last year – our turnover went up about 3% and anything beyond that was the new acquisitions,” he said.

“The full benefit of their turnover and profit will come through this year.”

He also anticipates the firm’s turnover rising to £60m by the year ending January 2023.

Mr Gordon is confident the firm will come through a challenging 2022 and hopes it will reach 60 pharmacies “in the next couple of years”.