Pharma Distributorship vs PCD Franchise – What’s the Difference?

Pharma Distributorship vs PCD Franchise – What’s the Difference?

There are two primary franchise agreements in the pharmaceutical sector: PCD and pharma franchises. PCD (Propaganda Cum Distribution) franchises deal with a particular region or area, providing the proprietor with the right to sell there. Pharma franchises, however, enable an individual or firm to sell more products under a specific brand name. Both have their pros and cons, and several individuals opt for these franchise models instead of opening their own independent businesses because of reduced risks and proven products.

Knowing the Models

It’s important to determine the differentiating characteristics for each model and compare a PCD pharma franchise with a pharmaceutical distributor with that information:

• PCD Pharma Franchise:  A franchise is provided to firms and individuals who can market and distribute pharmaceutical products under the name of a popular company. Exclusive (monopoly) rights for a specific region are given to the franchise partners, along with patents, promotional literature, and products.
• Pharmaceutical Distributor: The distributor buys products either directly from the manufacturer or from franchise owners of the manufacturer and sells them to retailers, hospitals, and drug stores. They usually operate in a wider geographic area, without any franchising ownership or branding rights.

PCD Pharma Franchise vs Pharmaceutical Distributor: Major Differences

1. Ownership and Autonomy:

• Pharma Distributor: The distributors or individuals in the PCD model are independent entities. They have an independent business setup and work as a separate unit from the parent company. They possess greater ownership and control of their business operations, such as marketing strategies, prices, and distribution.
• Pharma Franchise: Under the franchise format, the franchisee acts as an extension of the parent company. The franchisee is bound by a contractual arrangement with the parent company and adheres to its operations and procedures. The franchisee might enjoy lesser autonomy than PCD partners since they must adhere to brand uniformity and the policies of the parent company.

2. Investment and Infrastructure:

• Pharma Distributor: PCD partners invest in their own infrastructure, such as office space, distribution network, and promotion. The cost of establishing and operating the business is borne by them.
• Pharma Franchise: Franchisees invest in establishing the business infrastructure, such as premises, stock inventory, and promotional materials. The initial investment tends to be higher in the franchise model as compared to PCD.

3. Product Sourcing and Pricing

• Pharma Distributor: The products are bought directly from the parent company by the PCD partners at wholesale price. The pricing and profit margins on the products are in control of the PCD partners.
• Pharma Franchise: Franchisees purchase the products at a discounted price from the parent company. The parent company may determine the pricing beforehand, and franchisees have fewer options in setting their own prices.

4. Branding and Marketing:

• Pharma Distributor: PCD partners sell and distribute products under the brand name of the parent company. They can, however, enjoy greater autonomy to market the products using their own tactics and strategies.
• Pharma Franchise: Franchisees work under the brand name of the parent company and have to follow its brand name guidelines and marketing strategies. The parent company might supply marketing materials and assistance so that marketing is consistent across franchise outlets.

5). Support and Training

• Pharma Distributor: Product training, promotional tools, and general support from the parent company might be provided to PCD partners. But essentially, they have to run their own business.
• Pharma Franchise: More detailed assistance from the parent company is usually provided to the franchisees. This can include training courses, marketing assistance, constant guidance, and business operation assistance.

What’s the Right Route for You?

When choosing between the PCD pharma franchise and a pharmaceutical distributor, determine the goals of your company below:

• If your goal is to carry out low-investment business while exerting high control and enjoying exclusive rights of operation, the PCD franchise would be best suited for you.
• If you can undertake and control huge distribution and logistics businesses, then the distributor model would suit you better.

Summary:

Though both pharma franchise and PCD Pharma Franchise are all about selling and distributing pharma products, the major difference is in the degree of freedom and autonomy. SwisscheM Dermacare was created to offer PCD pharma companies in India at a low price range. We are involved in manufacturing, trading, supplying, distributing, and associating with PCD companies to provide novel and effective PCD pharma products. In the case of pharma PCD, the partners are independent and enjoy greater autonomy in their business, but in pharma franchise, the franchisee functions as a branch of the parent company, abiding by its instructions and sustaining brand consistency.