Pharmacies urged to modernise retail tech for margins

Canary IT has urged pharmacy owners to review how retail technology, loyalty schemes and margin reporting affect overall financial performance, as the sector faces tighter margins, higher operating costs and stronger competition.

Retail performance is becoming more central to pharmacy sustainability as consumer expectations shift and operators look for ways to protect profitability beyond dispensing revenue.

James Ormesher, Chief Executive Officer of Canary IT, said many pharmacies still run retail operations on systems that do not connect well with each other. "Dispensing remains central to pharmacy operations, but retail is increasingly where profitability is won or lost," he said.

He contrasted pharmacies investing in integrated retail management with those relying on manual workflows or separate tools for stock, pricing and loyalty. "We're seeing strong operators move toward fully integrated retail management systems that provide real-time margin insight, centralised stock visibility and loyalty integration. Others are still relying on manual processes or disconnected systems, which makes it difficult to respond quickly in a competitive market," Ormesher said.

Across Australia and New Zealand, pharmacies have faced cost inflation in labour, rent and energy. At the same time, competition has intensified from discount retailers, supermarkets and online sellers across a growing range of health and wellness categories. Many pharmacies also operate within banner groups, while others have expanded into multi-store models. These shifts have increased the complexity of retail execution, including how pricing is managed, promotions are planned and inventory is balanced across locations.

Systems focus

Retail system integration has become a priority as pharmacies seek clearer visibility of what is selling, category-level margins and how much stock is tied up on shelves. Real-time margin reporting is a particular focus because it can determine how quickly a business responds to supplier price changes or competitive discounting.

Loyalty programs are also playing a bigger role in retail planning. Pharmacies have used loyalty schemes for years, but operators are increasingly reviewing their structure and data. A scheme can influence return visits, purchasing behaviour and whether promotions deliver profitable growth. It also raises questions about how well loyalty tools connect with point-of-sale systems and stock management.

Technology choices are also increasingly viewed as part of a broader resilience agenda, spanning cloud infrastructure and cyber security alongside retail operations. This is particularly important for multi-site businesses that need consistent uptime and access controls across stores.

Ormesher described this as a change in how pharmacy owners set technology priorities. "Retail, cloud infrastructure and cyber security are no longer separate conversations. Pharmacy businesses are recognising that operational resilience and retail performance go hand in hand," he said.

Conference plans

At the 2026 Australasian Pharmacy Professional Conference, Canary IT plans to speak with pharmacy teams about how their retail systems have evolved and what gaps remain. It will use those conversations to inform a post-event Retail Benchmark report, providing an aggregated snapshot of retail maturity among attendees.

The benchmarking approach reflects a wider push in retail and healthcare-adjacent sectors to measure digital maturity and operational performance in comparable terms. In pharmacy, maturity can include the ability to view stock levels across locations, track promotional results quickly, and monitor margins in ways that inform daily decisions rather than end-of-month reviews.

Canary IT's work in pharmacy includes retail software and IT services. It highlighted LS Central for Pharmacies among the retail systems it discusses with customers, alongside cloud infrastructure and cyber security. Its managed IT services also support pharmacy groups seeking external help with device management, networks and security controls.

Ormesher said the conference also offers a chance to gather perspectives from independents, banner group members and multi-store businesses. "APP brings together a diverse cross-section of pharmacy operators. It's an ideal opportunity to listen, learn and contribute to the broader conversation about what sustainable pharmacy retail looks like in 2026 and beyond," he said.

Canary IT expects pharmacy owners to keep reviewing retail technology as competitive conditions evolve and as retail execution plays a bigger role in financial stability.