Early in 2019, Cedar Care Village Pharmacy will open. While this is Cedarville University’s first Limited Liability Corporation (LLC) and our first entrepreneurial effort at a local business through that LLC, other universities have done this for years. We have learned from them, and expect to experience the same success they have. I want to explain a few details about Cedar Care from my perspective, because we have never done this before.
First, why do it? The most important reason is ministry. A local pharmacy allows us to serve God’s Kingdom by serving and loving our neighbors well. That’s not the only criteria, but it’s the first one. Second, it provides a learning laboratory for our School of Pharmacy. Our students will benefit from the local pharmacy. Third, the University and the Village are connected. Endeavors that strengthen the Village will strengthen the University. This provides a stable business at the main corner of town. Finally, it will generate profit that will benefit the University.
Some of you may be wondering whether this new venture poses risks for Cedarville University and, if so, is it worth the risk? You may also wonder if the University will bail out the pharmacy should it not do well.
First, allow me to address liability concerns. Cedar Care Village Pharmacy operates under the Cedar Care Limited Liability Corporation. Cedarville University is the sole owner of the Cedar Care LLC. By operating the pharmacy under an LLC, it limits liability to the University should something unforeseen happen. In addition to this shield, we have insurance for those purposes. Should all go well, the University is the sole owner of the LLC and will benefit from profits. This provides a wall of separation between Cedar Care Village Pharmacy and the University. Also, patient and prescription information are legally protected and will not be shared with anyone at the University. As two separate entities, they have different Trustees and maintain separate finances. Liability and financial risks have been minimized through this separation.
Second, as we do in all things, a business model was developed to determine financial viability. I am frequently presented with business opportunities, and we always include data as part of the evaluation process. I am comfortable with measured risks and am very fiscally conservative. This pharmacy is positioned to have a very strong likelihood for success.
In fact, the pharmacy is projected to be very profitable by small business standards with a conservative pro forma. Why? We have built-in business advantages that reduce expense and generate business. We have a School of Pharmacy with licensed pharmacists who can help if needed for short periods, which means we do not have to employ and pay as many pharmacists as most small pharmacies would. Things like sick days or vacation time could be covered by the School of Pharmacy, instead of having to employ two full-time pharmacists just to operate the business consistently. We have a host of students who will work in the pharmacy as part of their training. We have the benefit of a student body that can generate business for the pharmacy.
We are creating a win, win, win situation. We can allow you to have greater discounts at Cedar Care, which means your prescriptions will cost you less money. As a preferred provider, our insurance costs will also be less. This will also generate business for the pharmacy. This creates a win for the University in insurance costs, a win for you in discounts for prescriptions, and a win for the pharmacy in business. We have several business advantages that a small-town pharmacy would not have otherwise. This increases our viability and profitability.
Hypothetically, should the pharmacy not do well, then we would change the business model or, worst-case scenario, we would close or sell it. We don’t foresee this happening, but in the age of disruptive technology and big business, it could happen somewhere down the road. As we do with majors that are no longer viable, if the pharmacy becomes nonviable, we will evaluate carefully and then make the right decision. We do have donors and external companies (who have already partnered with us on this initiative) who would likely assist if needed in the short term, but I want to assure you that we would not allow any auxiliary enterprise to put the University in financial jeopardy.
We anticipate a successful launch of Cedar Care Village Pharmacy in early 2019. You can help make that happen. So as someone concerned about the success of the pharmacy and not in my role as an employee of Cedarville, may I make a few suggestions?
- Consider changing your regular prescriptions to Cedar Care early next year.
- Make Cedar Care your first choice for filling prescriptions when you visit a doctor.
- Remind others, especially new students each year, about the opportunity to support a pharmacy that exists for the good of our neighbors and ultimately for the glory of God.
If the University and the Village of Cedarville support Cedar Care Village Pharmacy with our business, then it will be profitable. The Village of Cedarville will benefit from a local pharmacy with excellent care, and the University will benefit from the ministry, the teaching opportunities, and the profits that the pharmacy will generate.