“We want to not just match the price; but beat it,” claims Chemist Warehouse CEO

One of the leading pharmacy chains in Australia, Chemist Warehouse has recently entered the UAE with its flagship store in Al Ghurair Centre and aspires to disrupt the health & wellness landscape with its competitive pricing.

Popularly known in its home country as a ‘pharmaceutical juggernaut’, Chemist Warehouse has remained a private entity, growing from strength-to-strength over the past five decades.

Chemist Warehouse at a glance

• Established in 1972 
• Rebranded to Chemist Warehouse in 2000
• 500+ stores across Australia, New Zealand, Ireland, China and more recently in the UAE

A business model built to disrupt

With an aggressive discounting strategy, a high-volume, low-margin business model that focuses on competitive pricing, coupled with an extensive retail network, Chemist Warehouse has entered the UAE with a promise to make health & wellness products more accessible.

During an exclusive interview with IMAGES RetailME, we asked Priyash Paray, CEO, Chemist Warehouse if the brand offers the ‘lowest price promise’, since its USP lies in its value positioning? If a particular product is available at a better value in another pharmacy, will Chemist Warehouse be willing to match the price?

The short answer is yes, Paray responded. “We aspire to not just match the price; but beat it. If we fail on that promise, we give 10% of the price differential back to the consumer. Our vision is to offer the best price in the market across the board daily, not just during promotional periods. On top of offering the lowest price guarantee on over 15,000 SKUs in the UAE, we run promotions too,” he explained.

The science behind pricing

As a new player in a market category that’s well represented in the UAE, what problem is Chemist Warehouse looking to solve?

“Our vision is to make healthcare more affordable for everyone,” Paray responded. “Our research shows that there’s a segment of the market that’s not shopping at pharmacy chains due to high pricing. Our goal is to change that. Having said that, if we compare our pricing in Australia with the UAE, it’s never going to be the same. The regions and business dynamics are different. But, if I had one KPI, it is to bring the prices down.”

The consumer must win is Chemist Warehouse’s motto. But what is the science behind being the cheapest in the market while doing business profitably?

“We negotiate with suppliers as much as we can, and we believe in under promising and over delivering to the consumers. We always work with a goal to make the entire value chain work in a manner that all stakeholders – customers, suppliers and distributors – win and in turn we win. In that circle, we are happy to make a little less,” Paray opined.

While this approach may seem counterintuitive, it has worked for Chemist Warehouse over the past five decades.

Strategies that worked for Chemist Warehouse

• A low-price, discount-driven strategy appealing to budget-conscious consumers.
• Large-scale operations with 500+ stores in 5 markets, mostly situated in high-traffic retail locations.
• Digital integration through its own e-commerce channels while leveraging platforms such as Tmall in China to tap into a wider consumer base.
• Private label brands to increase profitability while maintaining competitive pricing.
• Franchise-like ownership model involving individual pharmacists co-owning stores, which aligns with regulations requiring pharmacist ownership. This hybrid model combines the efficiency of a corporate strategy with the personalisation of local entrepreneurship​.
• Global expansion with local adaptation by tailoring its offerings to regional markets. For instance, its UAE entry aligns with Dubai’s Healthcare Strategy 2030​.

The market has responded “positively”

Open in the UAE at Al Ghurair Centre since October 2024, the market has responded “positively” towards Chemist Warehouse.

“It’s been very pleasing to see the market response. The sheer size of our store, spanning 10,000 sqft, has caught the attention of consumers. The next 6-12 months will be a learning phase for us, looking at the landscape from an outside perspective, while trading on the ground,” Paray shared.

Among categories, beauty and health supplements are leading the way. Fragrances are also doing well.

Towards 2025

Overall, Chemist Warehouse’s entry into the UAE seems to be well-timed, as insights from a BCG report indicate that patients are increasingly seeking affordability and transparency in their healthcare choices. With its value promise and quality consciousness, Chemist Warehouse appears to be well placed to serve a market like the UAE with its diverse communities.

The brand is getting ready to open its second store in Burjuman. “Another five stores in Dubai would be a good achievement alongside building a robust online presence,” Paray added.

There are opportunities outside of Dubai as well. But Paray is committed to get the “learning piece” right before expanding into newer markets, to replicate its business model quickly.