Sunshine Healthcare’s Healthguard on expansion mode, gears up for the future

Steps up retail presence with a Rs. 100 million investment in last three years alone and targets becoming Sri Lanka’s first international standard healthcare retailer

Healthguard, the country’s premier pharma, wellness and beauty retail chain, is gearing up for the future, with significant investments into expanding its physical and online retail presence and enhancing the skills of its staff to meet the standards of international healthcare retailers.

Healthguard is a fully-owned subsidiary of Sunshine Healthcare Lanka Ltd. (SHL) – the Healthcare arm of the diversified Sunshine Holdings conglomerate with interests also in Agribusiness, FMCG, Packaging and Renewable Energy. Healthguard has committed Rs. 100 million over the past three years and incurred Rs. 70 million in FY15/16 alone to expand its retail presence. Healthguard expects to more than double its outlet network – consisting of standalone ‘Full Service’ stores and ‘Express’ stores (located within leading supermarkets) – from 24 at present to 50 by the 2018 financial year. From the beginning of 2015 to the present eight new Full Service and Express outlets have been opened.

The online store of the company which was launched in December 2015 is fast gaining traction and substantial online purchase behaviour is already being witnessed, Sunshine Healthcare Managing Director – Shyam Sathasivam – said, expressing optimism on the prospects of the newly-launched online store, and revealing plans to broaden the product mix and offering of the store. With the unveiling of the online store and island-wide delivery services, Healthguard expects to extend its footprint nation-wide.

“Even locally, as we gradually see a shift to a technology-driven, e-commerce based economy, it becomes important to maintain a suitable mix of brick and motor and online presence, to cater to the needs of, and engage with, different customer segments,” Sathasivam, who has served for over a decade as a Director of Sunshine Healthcare, said. A graduate of the London School of Economics and Political Science, UK, Sathasivam also holds an MBA from the Kellogg School of Management, Northwestern University, Chicago.

Besides improving its physical and online retail presence, Healthguard has committed substantial investments into enhancing the skills of its staff as it seeks to become the first player locally to benchmark itself against international healthcare retailers. Towards this end, Healthguard will soon open a dedicated training centre at Colombo 3 – the ‘Healthguard Excellence Centre’ – which seeks to significantly enhance the competencies of its staff, particularly pharmacists and customer service staff serving at company outlets.

Training will be delivered by in-house and external trainers such as product specialists or representatives from service training organisations. Training will be in line with organisation requirements or ‘output-focused’, utilising findings from ‘mystery shopper surveys’ etc. to identify areas requiring improvement.

“As expectations of customers evolve, continuous staff training is essential, particularly to provide service of an international standard,” Sathasivam noted.

Among such changes in customer expectations, a greater demand for beauty, wellness and fitness products is particularly noticeable, according to Sathasivam. In recognition of this trend, Healthguard has placed significant emphasis on expanding its health, wellness, beauty and fitness products portfolio, adding many products from globally-reputed brands. They also unveiled a new brand identity last year.

In an early indication of the success of these initiatives and in the strategic shift in its product portfolio, Healthguard outlets have witnessed rapid growth in over-the-counter sales volumes. Significant growth has been witnessed particularly in the beauty products segment. In the first nine months of the current financial year (9MFY16) Healthguard witnessed 22% Revenue growth on a year-on-year (YoY) basis. In the 2015 Financial Year (FY15), overall Revenue growth of Healthguard was 15% YoY.

“Apart from the figures in themselves, we are most encouraged by their implications – which indicate that our efforts, including the strategic shift in our product portfolio have put us on the right track,” Sathasivam said. “From selling primarily pharmaceutical products at its inception 10 years ago, the Healthguard brand has come a long way in establishing its credentials as a leading pharma, wellness and beauty retailer. Particularly with the expansion of our physical and online retail presence, and the establishment of the Excellence Centre, Healthguard is well-poised for its next phase of growth.”