What is pricing strategy?

Long Chau Pharmacy under FPT Retail has been leading the race to develop pharmacy chains in Vietnam. With a different pricing strategy, Long Chau has attracted a large number of customers. This article will analyze Long Chau's pricing strategy and draw valuable lessons for businesses in the pharmaceutical industry.

Pricing strategy is the way a business sets and adjusts product prices to achieve various business objectives such as maximizing profits, increasing market share, or meeting consumer demand. This is an important factor in the business planning process of any business, especially in fiercely competitive industries such as Pharmaceuticals.

Pricing Strategy is an important factor in the business planning process of an enterprise.

The role of Pricing Strategy is not only limited to generating revenue but also directly affects brand image, customer loyalty, and market competitiveness. An appropriate Pricing Strategy can help Pharmaceutical businesses differentiate themselves, build consumer trust, and strengthen their position in the market.

Current status of pharmaceutical industry in Vietnam

The pharmaceutical industry in Vietnam is growing strongly with the dominance of three giants: Pharmacity, Long Chau, and An Khang. All three pharmacy chains are trying to expand their scale, dominate the market, and position their brands through different business strategies:

Long Chau, An Khang and Pharmacity are currently the 3 pharmacies with the leading market share in the Pharmaceutical industry.

Current status of pharmaceutical industry in Vietnam

The pharmaceutical industry in Vietnam is growing strongly with the dominance of three giants: Pharmacity, Long Chau, and An Khang. All three pharmacy chains are trying to expand their scale, dominate the market, and position their brands through different business strategies:

Long Chau, An Khang and Pharmacity are currently the 3 pharmacies with the leading market share in the Pharmaceutical industry.

Long Chau Pricing Strategy Analysis

Long Chau's reasonable pricing strategy can be considered one of the main factors helping this chain surpass its competitors and capture a large market share.

Reasonable price 

Long Chau uses a low-price strategy to reach mass customers. Providing pharmaceuticals at lower prices than competitors helps Long Chau attract a large number of customers, especially those who need to use drugs regularly. This strategy not only increases sales but also helps the brand quickly gain the trust of consumers.

For the same seasonal illness with symptoms such as runny nose, dry cough, and mild fever, the price of medicine for 4 doses of treatment at major pharmacy chains has a clear difference. At Long Chau, the prescription price for 4 doses is only 28,000 VND, while An Khang sells it at a higher price of about 34,000 VND. Notably, at Pharmacity, this prescription costs up to 58,000 VND, partly because the pharmacist added cough drops without consulting the patient. If this additional product is omitted, the price of medicine at Pharmacity will be about 32,000 VND for 4 doses, still higher than Long Chau.

Long Chau has a significantly cheaper price than its two competitors.

Long Chau regularly launches discount promotions, “Shopping Golden Hours” or “Weekend Flash Sale”, “Same Price Golden Hours” to encourage customers to shop and enhance their experience. In addition, Long Chau also cooperates with partners such as Momo, VnPay to offer promotions with online payment methods.

The combination of promotional programs and affordable prices helps this pharmacy chain grow steadily and expand its scale.

With a large number of pharmacies, Long Chau is able to optimize operating and import costs, thereby continuing to maintain competitive prices. They can negotiate with suppliers for better prices, giving them a big price advantage over smaller competitors.

From Long Chau's strategy, pharmaceutical companies can draw some important lessons:

According to Maybank's forecast, Long Chau chain revenue could reach 1.6 billion USD by 2028 with a CAGR of up to 20% per year.

Long Chau's pricing strategy is proof that reasonable prices can help businesses succeed in a highly competitive market like Pharmaceuticals. With experience in Business Strategy and Marketing Consulting for more than 6,000 large and small brands, Nova Adwork is confident in accompanying businesses on the journey of sustainable development and revenue breakthrough!

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