Opening a Jan Aushadhi Store may not be a franchise business per se, but it can be a very good business idea because of the government support. In other words, you can call it a government franchise business. So, how to open a Jan Aushadhi Store (JAS), the government medicine store, and what are the investment requirements and application process?
The Department of Pharmaceuticals, Ministry of Chemicals and Fertilizers, Govt. of India had launched the Jan Aushadhi scheme in 2013 with an aim to cater to the public quality generic medicines at affordable prices through government regulated outlets in each district of all the states. Ideal for unemployed pharmacists, physicians and registered medical practitioners, it can be opened in just 120 square feet area. Here we have given a detailed guidelines for opening Sarkari medical shops. Keep reading to know more about Jan Aushadhi store opening application process, investment costs, margins and incentives, where to get application form for Jan Aushadhi store and so on.
What is the Jan Aushadhi Scheme?
Jan Aushadhi is a campaign launched by the Department of Pharmaceuticals, Ministry of Chemicals and Fertilizers, Government of India, in association with Central Pharma Public Sector Undertakings. It aims at providing good quality generic medicines to the common people at affordable prices to the masses. According to the official website of Jan Aushadhi, such generic drugs will be cheaper than branded medicines but will have equal efficacy and therapeutic value. To ensure the quality and efficacy of the drug in the Jan Aushadhi scheme, each bach is procured from CPSUs and private suppliers tested from NABL approved laboratories. They are tested as per standard requirements before being supplied to Jan Aushadhi Stores by the Bureau of Pharma Public Sector Undertakings of India (BPPI).
As already mentioned above, this business is not a typical franchise business. However it can be compared with a government backed individually operated retail business very much like a FOFO model.
Who can open a Jan Aushadhi Store: Eligibility criteria, qualifications
According to the official website of the Jan Aushadhi scheme, the said store may be opened by any one of the following three persons or entities:
- Any NGO/Institution/Co-operative Society identified by State Governments and free space provided in the premises of Government Hospital by the State Governments
- Any NGO/Society/Trust/Institution/Self Health Group having experience of operation in welfare activities for 3 years and having space and financial capacity
- Any individual including un-employed pharmacist / medical practitioner having space and financial capacity
However, please note that this article is mainly targeted towards individual Healthcare entrepreneurs and not any institution (third option in the quoted list). For the first two options, the application process, eligibility criteria, and net investments for opening Jan Aushadhi store will be different. Therefore, if you are an individual entrepreneur including unemployed pharmacists, doctors, and registered medical practitioners, having adequate financial abilities to run the store, duly supported by last three years’ bank statement or bank’s sanction letter for extending loans, you can apply for opening a Jan Aushadhi Store.
What do you need to open a Jan Aushadhi Store?
Premise or area requirements
You can open a Jan Aushadhi store even if you do not have own space. Any hired premise will do, provided that it is duly supported by proper lease agreements. The minimum area requirements for Jan Aushadhi Store as mentioned by the BPPI is just 120 square feet; which makes it a very good business idea for small premis
Documents required for Jan Aushadhi Store
As for any medical store, you need a sale license from competent authority. In other words, the applicant must have, in his or her own name, a retail drug license and / or TIN number. Additionally, you need to provide sufficient proof of having a pharmacist adequately knowledgeable in computers. You have to furnish certain details including the name of the pharmacist, registration number and so on. Also, to prove that you are financially capable of running the store, you must produce bank statement of last three years, or sanction letter from bank for extension of loans. Institutions must produce statements of audited accounts for last three years.
The gadgets you will require
First of all, to load the web based software, you must have a computer with internet connection and printer. The minimum configuration, according to the official website of JAS, is:
Minimum configuration:- a. Pentium IV/Dual Core Processor, b. 1 GB RAM (2 GB Recommended), c. 80GB HDD, d. TVSE MSP 240/250 series 80 column Dot matrix printer (Recommended), e. 500 VA UPS
Software requirements:- a. Windows XP/ Vista /Windows 7 (32 bit)/Windows 8 Operating System – Windows 7 (32 bit) is recommended, b. Anti-virus software, c. Internet connection – 512kbps
Additionally, you will need a refrigerator to store certain medicines that need to be kept within required temperature as specified by the Drugs and Cosmetic Act.
Furniture and accessories
If you want to start Jan Aushadhi Store (Govt medical shop), your place must have sufficient furniture such as racks for storing the merchandise, counters for issuing bills and medicines to customers, office and computer tables, chairs and stools as required etc.
Terms and conditions of running a Jan Aushadhi Store
Please note that there are certain terms and conditions applicable if you are going to start a Jan Aushadhi Store. Some of these are:
- The layout and furnishing of the store has to be done as per the design provided by the BPPI (at least to the closest extent possible).
- The Jan Aushadhi Store will sell only those medicines supplied by the BPPI. The list of medicines will be dynamic and may be changed from time to time.
- For individual shop-owners, payments have to be made in advance to BPPI for supply of medicines or merchandise supplied. However, JAS opened by operating agencies identified by the State Government will avail credit facility not exceeding 60 calendar days from the date of dispatching the drugs.
- Every bill must be prepared by using the BPPI-provided software only without which no drug can be sold, such as against handwritten bills etc.
- Obtaining the drug license as well as compliance to all other statutory requirements shall be the responsibility of the store owner or operating entity.
- Usually, the timing of Jan Aushadhi Stores are from 8 am to 8 pm. However, under certain circumstances, you may have to run the store 24 hours a day.
- Each JAS will get a dedicated landline phone for exclusive business use.
- For more terms and conditions of opening JAS (government drug store), please consult the official website.
Jan Aushadhi Store: Investment costs, profit margin, incentive, ROI
In the official website, there is no direct mention about net investment for Jan Aushadhi Store. Start-up costs, however, may be roughly calculated. Here, we have made a rough estimate of Jan Aushadhi store opening cost to give you an idea. Please note that we have assumed that you own the space, so rental expense has been excluded. Also, depending on the quality and number of furniture and gadgets, the price will greatly vary, so we have used price ranges instead of fixed sums.
Rough estimated cost of Jan Aushadhi Store Opening
- Furniture including counter table, chairs, stools, racks: Rs. 1 to 2 lakhs
- At least one computer, printer, internet connection: Rs. 40 to 70 thousand
- At least one refrigerator: Rs. 15 to 20 thousand
- Application Fee (As demand draft): Rs. 2000
- Advance payment for medicines (this can greatly vary): Rs. 2 to 3 lakhs
Thus, we may say that estimated minimum investment cost for Jan Aushadhi Store will be somewhat between Rs. 3.5 lakhs to 6 lakhs, excluding premise. This makes it a lucrative business within Rs. 10 lakh
Profit margin and incentives
The profit margin for Jan Aushadhi Store owners is 16 percent of the sale price. In fact the MRP is decided to accomodate that margin. Additionally, there is a sale incentive at 10 percent of monthly sales amount subject to a maximum of Rs. 10,000 per month for first year. For stores opened in North-East, Tribal Areas, and Naxal affected areas, the incentive is 15 percent of monthly sale amount, with the ceiling being Rs. 15,000.
Government (BPPI) financial assistance for opening Jan Aushadhi Store
The owners of JAS may avail one-time financial assistance of Rs. 2 lakhs as establishment cost and up to Rs. 50,000 as one time startup cost for purchase of computer hardware and so on. This is given as reimbursement. Bills of actual purchases and/or documents for establishment costs have to be furnished to get the reimbursement amount.
How to apply for Jan Aushadhi Store opening: Application process, forms
If you comply by the above mentioned eligibility criteria for opening the government medical shop, have the suitable space, and are ready to make the necessary investments, you may proceed to apply for getting a JAS license. Let us see how to get Jan Aushadhi Store permit, step by step.
Download Jan Aushadhi Store application form (PDF)
You may download Jan Aushadhi Store application form from the official website of the Jan Aushadhi Scheme (available as an annexure in PDF document). The URL of Jan Aushadhi Store opening application form download (PDF) is janaushadhi[dot]gov[dot]in[slash]data[slash]GuidelinesIndividuals[dot]pdf.
Duly fill in the form and send to competent authority
Applications in relevant format as mentioned in the Annexure II of the above stated PDF document may be sent, along with required documents, as well as the application fee of Rs 2000 as Demand Draft (non-refundable) drawn in favour of BPPI payable at Gurgaon, to the contact person mentioned below.
Jan Aushadhi Store application contact person, postal address
The General Manager (A&F),
Bureau of Pharma Public Sector Undertakings of India (BPPI),
IDPL Corporate Office, IDPL Complex,
Old Delhi Gurgaon Road,
Dundahera, Gurgaon – 122016 (Haryana).